What Does Minimum Essential Coverage Entail?

Minimum Essential Coverage was created when the Affordable Care Act was enacted. Before the Affordable Care Act began, people who already had medical conditions or had used too much medical care in the past were able to be denied coverage by insurers. Minimum Essential Coverage ensures that all ACA-compliant health care plans offer insurance to all enrollees regardless of health status or which plan they select. What exactly does minimum essential coverage entail?

To be considered minimum essential coverage, all health plans must cover ten necessary benefits. The amount of those benefits that they cover depends on the actuarial value. This number is determined by metal tiers, which depend on how much you pay per month. The more you pay the more is covered.

So what are the essential benefits that will be covered under minimum essential coverage?

Every plan must include these necessary benefits to ensure affordable health care for all. This saves people from spending ungodly amounts of money on health care services. These benefits include:

  • Laboratory Services: This includes diagnostic lab tests and preventive screening tests, like diabetes and cholesterol screenings.
  • Emergency Services: Any emergency care at a hospital or a facility out of network is covered with your insurer. 
  • Prescription Drugs: The medications are categorized by tiers, each tier contains at least one drug that your insurance will assists payment for. However, not all medications are within the tier, so similar medications to the ones included will not be covered under insurance.
  • Mental health and substance abuse related services: All plans include some kind of coverage for emotional and psychological well-being. These services include counseling, psychotherapy, mental health inpatient services, and treatment for substance abuse.
  • Maternity and newborn care: All plans include multiple services that care for you and your baby during all stages of your pregnancy, the delivery, and after delivery. 
  • Pediatric Services: For children who are included in your health plan your insurance will cover services that keep them healthy, including oral, vision care, vaccinations, and well-child visits.
  • Rehabilitation and habilitative services and devices: These services and devices that are designed for people with injuries, chronic conditions, and disabilities. It also includes physical, occupational, and speech therapy visits. 
  • Ambulatory patient services: Services included in outpatient care when a medical facility does not keep you the night after a procedure are covered.
  • Preventive/ wellness services and chronic disease management: Any services that assist you in staying healthy are covered by all insurance plans. This includes cancer screenings, annual checkups, and other preventative measures.
  • Hospitalization: If you have to go to the hospital for inpatient care, all plans are required to help with medical bills. This may only be more a certain period of time, but they are required to assist with the cost.

In addition to these 10 essential benefits for each plan, COVID-19 testing is also considered an essential health benefit. You must meet the CDC testing criteria to receive the test. If you live outside of California, New York, and Washington you will be required to pay any deductibles, copay, or coinsurance.

At SBMA, we are committed to providing top-of-the-line ACA compliant solutions to your insurance needs. Contact us for more information.

ACA Penalty A and B Breakdown

All large employers, with greater than 50 employees, must comply with the Affordable Care Act. The ACA requires employers to offer minimum essential coverage to all employees. If an employer does not comply with this employee coverage requirement could lead to penalties for the employer and potentially and IRS audit later on. Here is a breakdown of the ACA penalty A and B, and how they could affect your company:

ACA Penalties A & B.png

Health Insurance Options for Coronavirus Job Loss

As COVID-19 continues to impact our daily lives, unemployment has reached a record high, jumping to 14.7% as of April 2020. There are many things to consider when assessing these new statistics and, as an employer or an employee, it’s important to ask yourself this question: What health insurance options are there for those that have experienced job loss due to Coronavirus?

If you’ve lost your job due to Coronavirus or have experienced a reduction in hours, here’s what you can do:

If you’ve lost your health plan through your job you may qualify for a Special Enrollment Period. If you have lost your coverage within the past 60 days, or you expect to lose coverage in the next 60 days, you are also eligible for a Special Enrollment Period. 

If you have experienced a reduction of hours and are part of a Marketplace plan, you should update your application to report any household income changes within 30 days. This may lead to more savings than you’re getting now.

If you have experienced a furlough, depending on the status of your coverage, you might be eligible for a Special Enrollment Period. You might also qualify for a premium tax credit to assist your Marketplace coverage payment.

For people with COBRA continuation coverage, you may be able to qualify for the Special Enrollment Period. Based on your pre-COBRA coverage, you have 60 days to enroll in Marketplace coverage. You may also qualify for premium tax credits, only if you end your COBRA continuation coverage. 

If you have lost your job, but your company did not offer coverage, you typically do not qualify for a Special Enrollment Period. Job loss on its own does not make you eligible for a Special Enrollment Period.

If you are unable to pay your insurance premiums due to Coronavirus there are some things to consider: First, check with your insurance providers to see about extensions. Usually, there is a grace period determined by state law. If you receive financial assistance with your premiums, there is a three-month grace period where your plan cannot be terminated for failure to pay premiums. 

If you know that you qualified for a Special Enrollment Period, but missed the deadline due to Coronavirus impact, there is a chance you can be eligible for another Special Enrollment Period. 

As employers continue to understand how to effectively run their businesses throughout Coronavirus, we want to help you understand how to remain covered and safe. Here is a list of our COVID-19 resources that may be helpful as you work to understand what’s next for you and your company. 

What is the Employee Tax Credit?

The Employee Retention Tax Credit was rolled out as part of the CARES (Coronavirus Aid, Relief, and Economic Security) Act. It was enacted to encourage employers to retain employees throughout the Coronavirus pandemic. As our country begins to understand the full scope of COVID-19, this credit could allow employers to keep employees on their payroll and keep their doors open.

What is the Employee Retention Tax Credit?

The tax credit is a refundable tax credit that is meant to incentivize employers to keep employees on their payroll. For all businesses working to keep their staff on the payroll, 50% of qualified wages must be paid to the employees from March 12, 2020, to January 1, 2021. Including credit for qualified health plan expenses. 

An employer can claim up to $10,000 in wages paid if the employer’s business is entirely or partially suspended because of coronavirus and if their gross receipts also decrease by more than 50%.

What makes someone eligible for the Employee Retention Tax Credit?

The ERTC is available all employers, including tax-exempt organizations. The only organizations that are not eligible for the ERTC are state and local governments and their instrumentalities and any small business that has taken a Small Business Loan. Those who are self-employed are also not eligible for the ERTC.

An employer must be a business that has been fully or partially suspended by the coronavirus government orders, to qualify for the tax credit. If they do not meet that requirement, they may also be eligible if the employer has gross receipts below 50% of the same quarter in 2019. If the employer’s gross receipts go beyond 80%, they are no longer eligible for the tax credit after the quarter ends.

Employers with fewer than 100 employees may receive a tax credit for all employees. Those with more than 100 employees can receive credit for the employees who are being paid but are not working due to coronavirus cutbacks.

How can I claim the Employee Retention Tax Credit?

The ERTC cannot be combined with any other tax credit. If you are counting wages toward the Families First Coronavirus Relief Act tax credit, you cannot count those same wages toward the ERTC.

To begin your ERTC claim, employers should report their total qualified wages and other credits quarterly. Form 941 allows businesses to report their income, along with their Social Security and Medicare taxes withheld from employee’s paychecks. 

If an employer reduces the amount of payroll taxes they withhold from employee’s wages, they can be immediately reimbursed. 

As businesses continue to adjust their business plans in the face of coronavirus, there are many ways they can find relief through various programs. The ERTC is a good option for employers who are trying to keep their employees on their payroll. Visit our COVID-19 resource page for more information on programs that can benefit your business.

How to Offer Remote Workers Benefits

Due to changes caused by the Coronavirus outbreak, many people have made the transition to working from home. This new reality has changed the way most people do business — from holding meetings over Zoom to dealing with distractions at home, this new reality has been an adjustment for just about everyone involved. For employers, this has meant adjusting where they allocate resources and how they operate on a day-to-day basis. As companies continue to keep their employees working remotely, it’s important to understand the effects this change will have on employee insurance benefits.

Most Americans rely on their workplace to offer their health insurance options. As we adjust to a new way of working, it’s important as an employer to ask: Should I make adjustments to the benefits I offer my employees?

The answer to this question is almost always: Keep offering benefits! 

In order to retain employees and save company time and money, offering insurance is imperative. Health insurance is an important consideration most people take when deciding whether or not to take a job. Offering competitive health insurance options gives you a competitive advantage. 

When employees feel their best and know they are protected if anything happens, they are more likely to work harder for the company. Employees with insurance are more likely to go to the doctor for annual check-ups to ensure their health. If you give your employees insurance, they will likely take less time off for illness, which will benefit your company in the long run. 

Especially during these uncertain times, offering insurance and peace of mind to your employees allows them to focus on things other than their well-being. Virtual healthcare is also a great option for most employers, as the effects of COVID-19 drive many people to stay home as often as possible. If that is not included in your program now, consider adding it. Most people will want to be able to contact a doctor while adhering to the social distancing measures still in place.

As companies adjust to the “new normal,” they must consider how this could change their benefit programs for their employees. Ensure that you are giving the best options possible to all your employees, and giving them a piece of mind during this uncertain time. Contact us for more information on how you can best serve your employees with the best possible benefits.

Coronavirus and the Rise of Telemedicine

Coronavirus has flipped our lives upside down in more ways than one. One of the biggest changes is the expectation that nearly everyone stays at home as much as possible. Social distancing measures are currently being enforced in order to slow the spread of the virus, which has caused a major spike in the use of telemedicine resources.

Despite the emphasized concern for those infected by COVID-19, people with healthcare concerns and issues still need to regularly see their doctor, as well. This is where telemedicine can come into play — people who do not need to receive treatment in a hospital or doctor’s office are able to talk to their doctor and get what they need virtually from the safety of their homes.

Doctors’ needs for additional resources to treat and see their patients have put the spotlight on telemedicine in a big way. Doctors are now able to use secure, virtual consultations to keep both their patients and themselves safe. Coronavirus has made it imperative that health care workers are able to keep in touch with their patients in a way that keeps both of them safe from any unnecessary contact with others. 

Government leaders, public health authorities, insurers, and hospital systems have all been working diligently to give people as many health care services as possible virtually. This will likely become one of the new normals we will see after the pandemic is over. 

Telemedicine and virtual healthcare have been around for years, but the coronavirus is forcing people to utilize this great tool and is driving employers and insurance agencies to include this technology in their plans.

As a society, our acceptance of technology as an integral part of our everyday lives has made it possible for telemedicine to eventually replace in-person preventative medical visits completely. As our dependency on technology continues to grow, telemedicine will gain more and more traction with the vast majority of patients. 

In order to keep everyone safe, we need to continue implementing social distancing measures. For more information on virtual health services and how you can start using it, visit us!

How Coronavirus is Affecting Healthcare Costs

Coronavirus has disrupted quite a few industries over the last few months. One of the industries that it will continue to affect for the foreseeable future is the healthcare system. As it continues to spread, and we continue to see the effects of coronavirus, insurance programs will likely see a rise in health care costs. Here is an overview of how we think coronavirus could affect health care costs:

The first place we will likely see a rise in healthcare costs is with testing and treatment. As the number of coronavirus cases is still unknown and potentially growing, public health will be vital to limiting and eliminating the spread of coronavirus. There are mixed messages on whether or not we have reached the peak number of cases in the U.S, and some say that there may be another spike in cases shortly if social distancing is relaxed. 

The cure for coronavirus is still unknown, but the usage of current treatments are a way to support those who are infected. Once an effective treatment is established, there will likely be a reduction of strain on healthcare systems. Still, additional costs of implementing new drug treatments will cause the overall cost of care to increase along with a new vaccine treatment as an added cost in the near future. 

Around 15% of people infected with coronavirus require some kind of hospitalization, which typically includes needing ventilation. Costs associated with these procedures can be extremely expensive. Ventilation treatments can cost anywhere from $34,223 to $88,1114, depending on how long a person is on the ventilator. 

Many healthcare providers are concerned about the possibility of seeing an influx in people using healthcare services after stay-at-home orders lift. It is likely that the low demand for healthcare now will cause a delayed demand that could be overwhelming for providers and insurance companies later down the road. This sudden influx could quickly drain hospital resources if they are not adequately prepared. In some parts of the country, hospitals could not have enough beds for the number of patients needing care.

Hospitals have already begun canceling elective procedures. Though they are considered elective and therefore not urgent, these procedures almost always improve the patient’s daily life and prevent early death. These delayed procedures will likely be scheduled for next year, which would raise overall healthcare costs for 2021. Foregoing these procedures could also cause health outcomes to decline, as well as higher spending for the individual later due to complications. 

Medicare

Because the older populations are at high risk for contracting COVID-19 and potentially having complications related to coronavirus, the Medicare program could be affected. An increase in Medicare spending could potentially spill-over into the beneficiaries’ out-of-pocket spending in years to come. The out-of-pocket expenses will show up as an increase in premiums, deductibles, and other cost-sharing programs. 

Another consideration that may affect Medicare spending is telehealth services. Under the CARES Act restrictions on telehealth services, which could cause a decline in doctor’s office visits and the costs associated with holding in-person appointments.

Medicaid

Medicaid programs will also likely be affected by COVID-19. The costs of the program will likely increase as unemployment increases, and people are losing coverage provided by their jobs. Medicaid spending and enrollment increases in times of economic downturn. As more people enroll and the costs dealing with testing and treatment increase, the pressure on Medicaid costs will also increase.

As we continue to understand the effects of coronavirus, there are many implications to consider. Contact us to get the right coverage for you and your company.

ACA Penalties May Affect Your Business

Under the Affordable Care Act (ACA), large employers are required to offer health insurance to their employees. Despite everything going on, the IRS will continue issuing letters to large employers regarding penalties for years prior. Beginning in 2015, employers that do not meet the ACA standards can be assessed by a shared responsibility payment. Here are a few of the details behind the ACA health plan penalties and what that may mean for your business:

What are the standards for coverage under the ACA?

For employers to avoid penalties, they must meet three requirements:

Minimum essential coverage: Employers must offer healthcare coverage to at least 95% of full-time employees as well as their dependents until they reach the age of 26. Part-time employees who work fewer than 30 hours a week are not required to have coverage by their employer. 

Employers who do not meet the minimum essential coverage requirements could receive a penalty equal to the number of full-time employees, minus 30, multiplied by $2,000. This penalty can incur if one full-time employee purchases coverage with premium tax credits within the Health Insurance Marketplace. For 2020, the penalty is $2,570 for the year. 

Minimum value: The ACA also required employers to offer health coverage of a predetermined minimum value. The plan should cover certain medical expenses and pay at least 60% of the employee’s health care costs to meet this minimum value requirement. Employees would pay the additional 40% with deductibles and copays. 

Employers can determine insurance value by looking at the Summary of Benefits and Coverage document or by asking the health insurance providers. Employers can also calculate the minimum value on their own by using a government calculator or engage an actuary to determine the value. It is important to have written documentation that shows that your coverage supports the minimum value requirement.

Affordability: Lastly, the healthcare plan must meet the ACA’s affordability standard. This limits the amount employers can charge employees for self-only coverage. To be considered ‘affordable’ employee’s cost for self-only coverage can’t go above 9.5% of the employee’s wages in box 1 of their W-2 Form, the employee’s rate of pay, or the federal poverty level. 

If an employer does not meet the affordability requirement, they could open themselves up to a $3,000 annual penalty for the full-time employees that purchase health coverage on the Marketplace. The penalty adjusts for inflation rates, and for 2020 the rate is $3,860. 

What is considered a large employer?

Employers with at least 50 full-time employees (including full-time equivalents) from the previous year are considered large employers. Aggregated groups can make this consideration sometimes difficult. Companies with fewer than 50 full-time employees, but are involved in an aggregated group with other companies, will be considered large employers. 

These aggregated groups include a parent-subsidiary group if one company owns 80% of one or more companies; brother-sister groups with five or fewer employees, estates or trusts own 80% of two or more entities and have 50% identical ownership of those entities; tax-exempt organizations if 80% of directors or trustees of one organization are representatives of or controlled by another organization; firms that provide services, like healthcare, law, engineering, accounting, etc. if the firms have common owners, provide services for each other, or work together to provide services to customers; and lastly, any firm whose main revenue comes from the management of other companies.

As you begin calculating the number of individuals you employed last year, determine the number of employees who have worked at least 30 hours a week on average. Those who haven’t reached that number are added together and divided by 120 to determine full-time equivalents. 

What to do if you receive a penalty?

The employers that do not offer health coverage and meet the ACA requirements will owe penalties for full-time employees that report premium tax credits on their income tax returns for health insurance when purchased through the Marketplace. If this happens, the IRS will mail them a tax liability notice and allow them to respond prior to any required payment. 

Forms 1095- C and 1094- C and employee’s 1040 Forms are where the IRS will determine any shared responsibility payment. Once an employer receives notice from the IRS, employers have 30 days to respond by giving the IRS an explanation of why the assessment is incorrect in their view or pay the penalty. 

At SBMA, we ensure all of the coverage that is offered is ACA compliant. We help file your 1094 and 1095 Forms. Contact us for more information!

Voluntary Benefits Attract the Best Employees

Voluntary Benefits Aid in Attracting the Best Employees

Including options for voluntary benefits and supplemental benefits is quickly becoming the norm for most employers who offer health insurance to their employees. As an employer, attracting the best talent and keeping them is of the utmost importance to maintaining a successful business. Over the last few years, there has been an increase in demand for voluntary benefits. While major medical coverage is the foundation of a good employee benefits program, it’s important to ask the question: how can I use these voluntary benefits to make my company more attractive to new prospects?

Most employers view voluntary benefits as a way to provide a choice to their employees, to offer options for their diverse workforce, and to ensure that their employees are happier and healthier. Employees need solutions that they can cater to their specific lifestyle. 

Some voluntary benefit options include hospital confinement, accident, critical illness, disability, cancer, legal services, identity theft protection, and commuter benefits. Some employees will enroll in every type of coverage available. 

This shift in regard to voluntary benefits could be attributed to employers wanting to offer holistic coverage that supports their benefits strategy. Employers can align their benefits with their overall company offerings and values. 

With multiple generations involved in their workforce today, an employer must offer benefits that would cater to each of their needs. Those who are older might consider traditional benefits packages to be sufficient, but younger generations might prefer voluntary options. 

Enrollment portals allow employers to offer both core benefits and voluntary benefits in one place. This gives employees the flexibility of changing their plans whenever they need to and educate employees on how to choose the benefits that align with their needs. 

Not only do these benefits allow your company to attract and retain talent that will benefit your company in the long run. For more information on how you can offer the best, affordable benefits to your employees, contact us.

The Telehealth Revolution and Coronavirus

The demand for telehealth services has skyrocketed in the wake of the coronavirus pandemic. Still, an increase in consumer demand over the past several years can guarantee that telehealth options are here to stay. 

Public health officials are encouraging consumers to utilize contact-less telehealth services to stay safe and slow the spread of COVID-19. Not only does this form of healthcare keep the user safe from germs, but it also can help give doctors quick access to patients who need care urgently, but may be located in other parts of the country. While there is a lot to understand when it comes to telehealth services, here are the things we consider to be the most important:

How are people responding to telehealth services?

According to a survey from Accenture, 74% of those surveyed were happy with their telehealth experience. About 75% of people said they would use telehealth services to access healthcare after hours. Two-thirds said they would use this service for follow-up appointments rather than seeing a healthcare professional in person. 

So, how does telehealth work?

Email, video conferencing, and video chat services are used to receive care from the comfort of your own home. The healthcare professionals responding to consumers either respond in real-time or giving consumers a place to find their answer.

The costs associated with telehealth services are dependant on the insurance plan coverage. Programs like Medicare cover telehealth services. Consumers can also pay out-of-pocket for their telehealth services. These services can cost anywhere from $50 to $80, or a potential annual membership fee.

As far as security goes, patient privacy is protected if the providers are operating in good faith. But if these services use avenues, like Zoom or Skype, the security may be a little riskier. At SBMA, we offer 24/7 access to doctors with no cost to you, as well as behavioral health services with a $50 copay. 

Telehealth services also give doctors the ability to send in a prescription to a pharmacy. Our telehealth services cover generic physical and behavioral prescriptions with a $10 or $25 copay.

While telehealth services cannot diagnose or treat coronavirus, they can offer quarantine and self-care tips to implement while you are home. If you are unsure whether or not to go to the hospital, you can use telehealth services to help decide whether or not you need to. 

For more information on telehealth services and how you can offer them or receive them, contact us!