- Home
- Publications and Resources
- Stat! Health Reform Weekly
Welcome to Stat! Health Reform Weekly. On this page, Segal will provide highlights of health care reform developments in the past week, as well as information on important developments to come.
June 11, 2010
Draft Early Retiree Reinsurance Program (ERRP) Application Available
The Office of Consumer Information and Insurance Oversight (OCIIO), an agency within the Department of Health and Human Services (HHS), has posted a draft of the ERRP application with instructions on its Web site: http://www.hhs.gov/ociio/regulations/index.html#early_retiree. The Web page states that OCIIO does not anticipate that the application will change when it is finalized (except to include an address where the official application can be sent).OCIIO has posted the draft application to give sponsors an opportunity to gather the necessary information to complete the application.
According to OCIIO, the official application will be available later this month. Plan sponsors can use the draft application to prepare for their ERRP filing.
OCIIO also released a first set of frequently asked questions. OCIIO states in these frequently asked questions (FAQs) that there is no pre-determined number of applications that HHS is planning to accept. Applications will be processed in the order in which they are received. These FAQs, as well as other materials, including interim final rules published in the Federal Register on May 5, 2010, are available on the OCIIO Web site: http://www.hhs.gov/ociio/.
Other Issues
Other recent items concerning the Affordable Care Act include the following:
- This week seniors who qualify will start getting a $250 rebate check once they reach the donut hole or coverage gap in Medicare Part D coverage. This is the first of several Medicare reforms in the new law. For details, see: http://www.whitehouse.gov/the-press-office/affordable-care-act-strengthening-medicare-combating-misinformation-and-protecting-. A few weeks ago, HHS sent a mailing to all Medicare beneficiaries highlighting changes made by the new law to Medicare benefits. This is available at http://www.medicare.gov/Publications/Pubs/pdf/11467.pdf.
- On June 4, 2010, the Secretary of HHS sent a letter to sponsors of Medicare Advantage plans encouraging these plans, as they prepare to submit bids for 2010, not to shift costs to seniors in the form of higher premiums, but to focus on competing on price and quality. The Affordable Care Act will gradually decrease government payments to Medicare Advantage plans.
- On May 17, the Internal Revenue Service published Notice 2010-44 (http://www.irs.gov/irb/2010-22_IRB/ar12.html), providing additional guidance on the small business tax credit.
- Interim final rules on the age 26 extension of coverage rule were published in the Federal Register on May 13, 2010. For more information, see Segal's May 2010 Bulletin, "Regulations on Group Health Plan Coverage of Adult Children Released": http://www.segalco.com/publications-and-resources/bulletins/?id=1453.
- Regulations interpreting the grandfathering provisions in the new law, as well as the provision in the law that would provide an extended period for collectively bargained plans to comply with certain provisions, are expected soon.
COBRA Premium Assistance Subsidy ended May 31, 2010
The eligibility window for the Consolidated Omnibus Budget Reconciliation Act (COBRA) premium assistance subsidy has now expired. The subsidy had been extended three times, most recently through May 31, 2010. Because Congress has not passed another extension, individuals who face an involuntary termination that occurs after May 31, 2010, are not currently eligible for the subsidy. Individuals who are receiving the subsidy based on an involuntary termination that occurred prior to June 1, 2010, can continue to receive the subsidy for their remaining eligibility (i.e., whatever portion of the 15-month subsidy that has not yet been used).
Plan sponsors have repeatedly changed COBRA notices in the last year in order to accurately reflect the details of the premium assistance subsidy. Current notices that refer to the May 31, 2010 date would be accurate since the subsidy has not been extended.
On May 28, the House of Representatives passed the American Jobs and Closing Tax Loopholes Act (H.R. 4213), which contained, among other benefits related provisions, an extension of federal unemployment compensation programs. Earlier versions of the legislation would have extended the COBRA premium assistance subsidy through the end of 2010. However, the House removed an extension of the COBRA premium assistance subsidy from the bill. The Senate recessed for the Memorial Day weekend without acting on the legislation. Consequently, the COBRA premium assistance subsidy was not extended.
Although the COBRA premium assistance subsidy was removed from the American Jobs and Closing Tax Loopholes Act, Congress may pass another COBRA extension. Plan sponsors should continue to monitor developments. Information about the law is available on the Department of Labor's Web site: http://www.dol.gov/ebsa/COBRA.html.