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Cigna + Oscar Withdraws from
The Small Group Market

New Cigna + Oscar (C+O) small group sales and renewals will not be offered in 2025. At C+O’s request, all plans and rates have been removed from the quote engine. However, you can still quote or renew your C+O groups through December 15, 2024 by contacting us at quotes@claremontcompanies.com or 800.696.4543. Please note: the last day of coverage will be December 14, 2025.

For assistance, please contact our Quotes team at quotes@claremontcompanies.com or 800.696.4543.

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Healthcare Reform

Archive for the ‘Healthcare Reform’ Category

2024 Decrease in ACA Health Plan Affordability Threshold

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The Internal Revenue Service (IRS) has announced the Affordable Care Act’s (ACA) health plan affordability threshold for 2024 at 8.39%, a significant decrease from the 2023 figure of 9.12%.

The threshold is used in determining if Applicable Large Employers (ALE’s) health plans are considered affordable under the ACA employer mandate. This requirement does not apply to non-ALE businesses.

This is a significant reduction in the affordability threshold. Your ALE clients should be aware of the change, and may need to make changes to their health plan’s 2024 employee contribution in order to remain compliant.

For details, visit SHRM and Woodruff Sawyer, and the IRS website.

Contact us today for assistance with your ALE groups.

 

 

Questions?
Contact The Answer Team at 800.696.4543 or info@claremontcompanies.com.


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CAHU Submits Testimony to Single-Payer Commission

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Last month CAHU submitted testimony to “Healthy California for All,” California’s single-payer commission.

The “Healthy California for All” commission, launched by California Governor Newsom in December 2019, is developing “a plan for advancing progress toward achieving a healthcare delivery system for California that provides coverage and access through a unified financing system, including, but not limited to a single-payer financing system.”

CAHU’s testimony represents the collective experience and expertise of its membership of well over 2,000 California health insurance agents, brokers, and other healthcare professionals.

Summary of CAHU’s Testimony

Read CAHU’s testimony for the full details.

CAHU Testimony

 

Questions?
Contact The Answer Team at 800.696.4543 or info@claremontcompanies.com.


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US Supreme Court Ruling Upholds The Affordable Care Act

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On June 17, 2021, the US Supreme Court declined to overturn the Affordable Care Act by a 7-2 vote, rejecting a lawsuit filed by a group of Republican state attorneys general claiming that a change made by Congress in 2017 had rendered the entire law unconstitutional.

It’s the third time since 2010 that the Affordable Care Act (ACA), known as Obamacare, has survived a challenge, allowing millions to keep their insurance coverage amid the coronavirus pandemic.

This decision reversed a lower court ruling finding the individual mandate unconstitutional. However, the court did not address the question of whether a key provision in the law was unconstitutional and whether the bulk of the law could stand without a provision that initially required most Americans to obtain insurance or pay a penalty. Instead, the court held the plaintiffs do not have standing in the case, or a legal right to bring the suit.

President Joe Biden tweeted that the decision is “a big win for the American people.” Health and Human Services Secretary Xavier Becerra, who helped write the law as a member of Congress and now is responsible for implementing it, said the decision “means that all Americans continue to have a right to access affordable care, free of discrimination. More than 133 million people with preexisting conditions, like cancer, asthma or diabetes, can have peace of mind knowing that the health protections they rely on are safe.”

Millions of Americans (including nearly 6 million Californians) gained health insurance coverage as a result of the ACA, President Barack Obama’s landmark law passed in 2010. Hundreds of millions more have had their health care and coverage affected by provisions as wide-ranging as changes in Medicare drug copayments, requirements for calorie counts on menus, a pathway for approval of generic copies of expensive biologic drugs, protections for people with preexisting conditions, and a ban on lifetime caps on coverage.

The ACA, has been the subject of unrelenting Republican opposition. But Congressional attempts to repeal it have failed as well. The latest challenge threatened to undo coverage gains under the law that helped drive down the uninsured rate to a record low. Since enacted 11 years ago, the law has gained popularity and reshaped virtually every corner of American healthcare.

Former President Barack Obama tweeted “This ruling reaffirms what we have long known to be true: the Affordable Care Act is here to stay.”

Additional Resources

 

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Contact your Claremont team at 800.696.4543 or info@claremontcompanies.com.


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Which of Your Clients Are Subject to The ACA’s “Play or Pay” Provisions?

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Despite the intense media focus on repeal, replace and repair, the laws and regulations of the ACA are still in effect, including the Employer Shared Responsibility provisions (“Play or Pay”). Early each year, your clients should answer the following critical question: Was their count of full-time plus full-time equivalent employees 50 or more on average during the prior year?

If the answer is “yes,” then your client is an Applicable Large Employer (ALE) and must offer coverage to full-time employees or potentially incur penalties. You will want to quickly have a discussion with them about putting a plan in place.

However, if the answer is “no,” then they are not at risk of incurring penalties if they choose not to offer coverage. This includes not offering coverage during the current year even if they were an ALE in prior years.

Have your clients asked and answered that key question? If not, you may want to quickly engage in a discussion with them about the topic. For your reference, Claremont has developed a comprehensive Play Or Pay Guide for Brokers. In it you and your clients can learn how to:

If your client determines they are an ALE for the first time, there is transition relief that permits them to not offer coverage through March of their first year as an ALE. This article provides helpful information for new ALE’s and their deadline for offering coverage.

Questions?
Contact the small group experts at 800.696.4543 or info@claremontcompanies.com.

 

ALEs and Employee-Only Coverage

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An Applicable Large Employer (ALE) may be meeting its Large Employer Mandate obligation to offer Minimum Essential Coverage and a Minimum Value plan, but are they certain they are offering coverage to all eligible employees and dependents? If your client has selected an employee-only coverage plan, the employer may be exposing their business to a penalty. While the employer does not need to contribute towards the cost of dependent coverage, they are required to offer coverage to dependent children.

The Society for Human Resource Management (SHRM) states that dependent status under the PPACA is based on the relationship between a child and a participant and that a large employer that fails to offer coverage to employees’ dependents is not meeting the ACA requirements for coverage and therefore subject to an assessable penalty.

Did you know groups with substantially fewer than 50 employees may be an ALE?
If you have ALEs in your book that are on employee-only coverage, we can assist those groups written with Covered California.

To learn more about the Large Employer Mandate and how to identify Applicable Large Employers, download our essential ‘Play or Pay’ guides.

Questions?
Contact the small group experts at 800.696.4543 or info@claremontcompanies.com.

SB 125: Revises the Definition of Small Employer

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On June 17, the Governor approved Senate Bill (SB) 125. A section of SB 125 revises the definition of small employer for plan years commencing or renewing on or after January 1, 2016. The definition of small employer, for purposes of determining employer eligibility in the small group market, will no longer be based on a count of eligible employees, but shall instead be determined using the method for counting full-time employees and full-time equivalent employees set forth in Section 4980H(c)(2) of the Internal Revenue Code. Quickly see where new rules differ from prior rules by downloading the guide below.

SB 125 Definition of Small Group

Employer size under Section 4980H(c)(2) of the Internal Revenue Code is determined by taking the sum of the total number of full-time employees and full-time equivalent employees for a calendar month. To be a small employer in California, the result must be at least one, but no more than 100, on at least 50 percent of the preceding calendar quarter or preceding calendar year. The majority of these employees must be employed within California. The requirement that a bona fide employer-employee relationship exists still applies.

A full-time employee is someone employed an average of at least 30 hours of service per week. To calculate full-time equivalent employees, the number of hours of service for a calendar month of all employees who are not full-time are aggregated then divided by 120. No more than 120 hours of service can be credited for any employee who is not full-time. Hours of service includes both working hours and non-working hours for which an employee is paid or entitled to be paid, such as vacation, holiday, illness, incapacity, jury duty, military duty, and leave of absence.

The regulations of Section 4980H(c)(2) specify to include seasonal workers when counting the number of full-time employees and calculating the number of full-time equivalents. A seasonal worker is someone who performs labor or services on a seasonal basis. This employment is only done during certain periods and not throughout the year, such as those who only work during the holidays. Someone who works in agriculture, but performs different activities in different seasons, is considered seasonal, even if they are employed most of the year. A reasonable, good faith interpretation of the term seasonal worker may be applied.

As described above, SB 125 will result in significant changes to the small group market. However, the practical administration of this law has yet to be determined. Stay tuned for updates on this topic.

Questions?
Contact us at 800.696.4543 or info@claremontcompanies.com.

When Is An Employer’s First Year As An ALE?

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The final large employer mandate regulations provide for a transition rule for an employer’s first year as an applicable large employer (ALE). An ALE is an employer that employed an average of at least 50 full-time (FT) and full-time equivalent (FTE) employees in the prior year. During an employer’s first year as an ALE, the ALE will not be subject to a penalty from January through March for failure to offer coverage to employees who were not offered coverage at any point during the prior calendar year provided the ALE offers affordable and minimum value coverage to these employees on or before April 1.

This transition rule allows employers, particularly employers that have close to 50* FT employees (including FTEs), but are not certain they will be ALEs, time to put coverage in place once they have determined they are ALEs. Since the measurement period to determine ALE status ends December 31**, employers will have no time to offer coverage to its employees by January 1. Starting coverage in the middle of the month to give employers time to put coverage in place is not an option, because an employer that fails to offer coverage to a FT employee for any day in a calendar month is treated as not offering coverage for the entire calendar month.

There has been some confusion among employers that want to take advantage of this transition rule in 2015 as to when is their first year as an ALE. In 2013, the IRS delayed the reporting requirements making it impractical to determine which employers owed a penalty. As such, no penalties were assessed in 2014. However, this had no effect on the effective date of the law, it was simply enforcement of the reporting requirements and penalties that were delayed. This means employers still needed to determine if they were an ALE in 2014. Therefore, 2015 is not the first year an employer is an ALE, if that employer was an ALE in 2014 (based on 2013 data).

It can be argued that the first year as an ALE for every employer with 100 FT employees (including FTEs) is 2015. Since no penalties were assessed in 2014, it can be claimed that employers were not required to comply with the provisions of the large employer mandate in 2014, including determination of ALE status. However, if this were the case, any employer with 100 FT employees (including FTEs) in 2015 could avoid penalties from January through March for failure to offer coverage to employees who were not offered coverage at any point during the prior calendar year. It is unlikely that this was the IRS’ intention. Moreover, the instructions for the reporting forms for ALEs (IRS Forms 1094-C and 1095-C) are clear that 2015 is not the first year an employer is an ALE, if that employer was an ALE in 2014 (based on 2013 data).

*Only employers with 100 or more FT employees (including FTEs) are subject to the mandate in 2015. Employers with 50-99 FT employees (including FTEs) will not be subject to the mandate in 2015 if these employers meet certain conditions and certify to the IRS that they meet these conditions. These ALEs will be subject to the mandate in 2016.

* *To determine ALE status for 2015, an employer may use a reference period of at least six consecutive calendar months (as chosen by the employer) during 2014 (rather than the entire 2014).

In our library, you’ll find carrier forms, applications, enrollment kits, broker bonuses, marketing resources, and more (video tutorial). However, not all carrier forms are available online.

If you don’t find what you are looking for, contact our team for help at 800.696.4543 or materialsrequest@claremontcompanies.com.