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Healthcare Reform Timeline

What changes to expect from the new Healthcare Law, presented by the National Federation of Indepedent Business

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151 views16 pages

Healthcare Reform Timeline

What changes to expect from the new Healthcare Law, presented by the National Federation of Indepedent Business

Uploaded by

nfib
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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The Healthcare Reform Timeline

What Changes to Expect from the new Healthcare Law

Presented by
When President Obama signed the healthcare bill into
law on March 23, 2010, the clock started to tick on a
variety of changes. Whether it’s the new taxes or the
changes to the insurance you buy in the small group and
individual insurance markets, this timeline provides a
quick glance at changes you can expect in coming years:

2012 2014 2016 2018


2010

2011 2015 2017


2013
2010
• A temporary small business tax credit is available for six
years for some firms that provide qualified health coverage.
The rules include:
– 1) Only firms with 10 or fewer employees receive full
credit. Firms with 11 to 25 employees, credit is reduced.
Firms with more than 25 employees get no credit.
– 2) Only firms that pay their workers an average of
$25,000 or less are eligible for the full credit. The credit is
reduced as the wage goes up, phasing out at $50,000.
– 3) Only firms covering 50 percent or more of insurance
costs will be eligible. Beginning in 2014, if you qualify for
the employer tax credit, you must purchase your plan in
the exchange.
(2010 continued)
• A 10 percent excise tax on indoor tanning services begins
July 1.
• Insurance reforms begin. In June, temporary high-risk pools
are created for uninsured adults with pre-existing
conditions. For plan years beginning in late September,
there will be prohibitions on lifetime and annual benefit
spending limits, non-group plans will not be allowed to
cancel coverage, plans must cover most preventive care and
dependents will be allowed to stay on parents’ policies until
age 26.

Return to Timeline
2011
• Employers will be required to report employee health
benefits on W-2s.
• Manufacturers and importers of brand-name drugs will
begin paying a $2.5 billion tax.
• Consumer-driven account limits begin on over-the-counter
medications. The penalty for using HSAs for non-qualified
purchases doubles to 20 percent.
• Employers may voluntarily participate in federally subsidized
long-term care programs. Participating firms’ employees will
be automatically enrolled and subject to payroll deductions
unless they opt out.

Return to Timeline
2012
• Businesses will have to send Form 1099s for every business-
to-business transaction of $600 or more.
• Brand-name drug tax is $3 billion per year through 2016.

Return to Timeline
2013
• 2.3 percent excise tax on medical devices begins.
• Threshold at which medical expenses as a percentage of
income, are deductible increases to 10 percent, from 7.5
percent
• Medicare payroll tax on wages and self-employment income
in excess of $200,000 ($250,000 joint) will increase.
• Medicare investment tax imposes 3.8 percent tax on
investment income for higher-income taxpayers.
• Cafeteria plan Flexible Spending Accounts will be limited to
a maximum of $2,500

Return to Timeline
2014
• An $8 billion tax will fall on the majority of plans that small
businesses purchase, but not on self-insured plans.
• Health insurance exchanges open to individuals and small
businesses with up to 50 employees.
• Premium credits kick in, and the government begins
subsidizing individuals up to 400 percent of the poverty line.
• Federal officials must define an essential benefits package
with which all insurance policies must comply. 
(2014 continued)
continued

• Individual mandate begins. Individuals without government-


approved coverage are subject to a tax.
• Insurance reforms take effect, and insurers cannot impose
coverage restrictions based on pre‐existing conditions.
Modified community rating standards go into effect for
individual or family coverage based on geography, age and
smoking status. Insurers must offer coverage to anyone. The
law also limits out-of-pocket cost-sharing and insurance
plans must include government defined “essential benefits”
and coverage levels.
(2014 continued)
• Employer mandate begins, requiring growing firms to
provide insurance. The penalties are based on the number of
full-time employees, whether the firm offers coverage and
whether employees qualify for government subsidies. An
employee qualifies for a subsidy if his or her household
income is below 400 percent of the federal poverty line.
Here are some scenarios:
1) More than 50 full-time employees and company does not
offer insurance, with one or more employees receiving
premium subsidies. The penalty is $2,000 per full-time
employee (minus the first 30 employees).
2) More than 50 full-time employees and offers insurance
with one or more employees receiving premium
subsidies. Penalty is the lesser of $3,000 per subsidized
employee or $2,000 per full-time employee (minus the
first 30 employees).
(2014: Employer Mandate cont’d)
3) More than 50 full-time employees and offers insurance,
with no employees receiving premium subsidies. No
penalty on employer. All non-grandfathered and
Exchange health plans are required to meet federally
mandated levels of coverage.
4) 50 or fewer full-time employees: No penalty or
requirement to offer insurance. Those who qualify for
the employer tax credit must purchase a plan from the
exchange.
5) New counting requirements for part-time: Part-time
employees’ hours will be converted into full-time
equivalents for calculations of compliance and
determination of penalties. For example, if six
employees each work five hours per week, they will
count as if the firm had one additional full-time
employee.
Return to Timeline
2015
• Small business health insurance tax is $11.3
billion.
• Individual mandate penalty increases to $325
or 2 percent of income, whichever is greater.

Return to Timeline
2016
• Small business health insurance tax is $11.3
billion.
• Individual mandate penalty increases again,
to $695 or 2.5 percent of income, whichever
is greater.

Return to Timeline
2017
• Brand-name drug tax increases to $3.5
billion.
• Small business health insurance tax increases
to $13.9 billion for 2017.
• Individual mandate penalty is based on 2016
levels and will rise according to a cost-of-
living adjustment.

Return to Timeline
2018
• Cadillac tax begins on high-cost plans.
• Brand-name drug tax increases to $4.2
billion.
• Small business health insurance tax is $14.3
billion.
• Individual mandate penalty is based on 2016
levels and will rise according to a cost-of-
living adjustment.
Return to Timeline
For more information on the healthcare reform and
legislation, visit:

http://www.nfib.com/business-resources/get-healthcare

…Here you’ll also find important information


about the impact on small business and how you
can join the discussion!

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