Column 86 Health Care rules are fluid

Nothing is so constant as change, especially when it comes to health care rules and regulations.  I have said that multiple times in this column and this year is no exception. 

First, individuals may have another new extended enrollment period.  This new "Qualifying Life Event: is called Informed of Tax Penalty Risk.  


 It will only be available from February 23, 2015 through April 30, 2015. This allows consumers to enroll in a Covered California Health Plan after Open Enrollment if they are consumers who were made aware of the tax penalties for remaining uninsured for 3 months or more during the year.


To be eligible for the, "Informed of Tax Penalty Risk", period consumers must attest that they became aware of the tax penalty after the 2015 Open Enrollment Period closed.  In addition, they must apply through a certified agent or enrollment center, or they can contact Covered CA at 800-300-1506.  No self-enrollment online is allowed. You may find a certified agent or enrollment counselor at and click on Find Help Near You.


As mentioned earlier in this column, I suspected that once folks started doing their taxes and found out about the penalties there would be some complaints.  Apparently they did not fall on deaf ears. 


Once you indicate you are newly informed of the tax penalty risk, you are eligible to enroll.  From what I can see on the site, there is no lie detector test or description of how and when you found out required.  Even if you do not qualify for a subsidy, this is currently the only way to get extended access to open enrollment, absent a qualifying event.


In other "big news: the IRS announced that small businesses using standalone Health Reimbursement Accounts (HRA) or related vehicle for employees to purchases individual health insurance coverage  that doesn't comply with the ACA are getting a break.  They now have until June 30, 2015 to create a compliant plan and avoid penalties.   The ACA is the Affordable Care Act, also known as Obamacare.  The business must employ less than 50 employees to be eligible for the transition relief.


The National Federation of Independent Businesses Research Association reports that about 14% of small employers use an HRA arrangement for employees. NAHU (National Association of Health Underwriters) has opined that these types of plans are not legal and were not legal even before the ACA.


If found to be in violation an employer can be liable for upwards of a $100 per-day per-employee penalty, or $36,500 per employee annually.  This update can be found in Notice 2015-17 published Feb. 18.


The notice further clarifies that an employer can simply increase an employee's pay and if the payment is not directly tied to health insurance premiums it will not be considered an employer payment plan and be subject to the ACA rules.  This means they cannot require the employee to buy coverage to be eligible for the salary increase. Simply providing employees with information about the Exchange the Advanced Premium Tax Credit is not considered an endorsement of a particular policy.


Some small employers, particularly those with lower paid employees have found that it's easier and less costly to raise an employee's pay than to provide group insurance.  Then the employee is directed to "fend for themselves".  The downside for the employee is that the products are quite different in the individual market in terms of network access and Rx formularies. The other downside is that the employer risks putting himself in the same boat!


So an employer that is looking to attract and retain employees may want to provide the additional benefits available in group plans. 


As I said in the beginning, I expect it will take 5 years for this to work out all the kinks. Let's see if I am right.