The Affordable Care Act 2013 Update

Many think that the ACA does not really hit until 2014, but actually, there are many changes mandated for 2013. Here’s just some of the highlights:

1- Employer Letters to Employees re: Exchanges --- employers across the land will have to send out letters to all employees by March 1, 2013 explaining Exchanges, what they are and how they will work. The Federal regulators have implied they may postpone this, to get out a “template letter” to all, but so far, March 1 is still the deadline. Thereafter, letters will have to go to all new employees.

2- New Fees --- for plan years ending on or after October 1, 2012, health insurers (not the insured, but the insurers), and self-insured plans will have to pay $1 per covered life (yes, that includes dependants) in 2013, and $2 each in 2014, to fund the new Patient=Centered Outcomes Research Institute.

3- Higher Medicare Taxes --- On wages exceeding $200,000 for single filers, and $250,000 for joint filers, the Medicare insurance tax rate will bump up from 1.45% to 2.35% -- an increase of almost 1% in new taxes to pay. This is employee-only; employers managed to lobby their way out of any increase.

4- W-2 Reporting – employers must report on W-2’s for 2012 income, due out by January 31, 2013, any expenditures made for employee health care. This does NOT applied to Taft-Hartley Trust Funds. Some see this as a prelude to some day taxing health care employer contributions.

5- Exchanges Coming On Line --- the big bang! Exchanges won’t provide coverage until January 1, 2014, but a six month initial open enrollment period will begin October 1, 2013 – and in California, the Exchange will be on line and visible to all by the middle of 2013 if all goes according to schedule.

For more details, contact legal counsel --- and fasten your seat belts, the ride is going to be fast and furious!

By Bill Sokol

Legal Developments