CURRENT ISSUES IN HEALTHCARE REFORM

1. CURRENT ISSUES IN HEALTHCARE REFORM Alice Helle BrownWinick 666 Grand Avenue, Suite 2000 Des Moines, IA 50309-2510 Telephone: 515-242-2407 Facsimile: 515-323-8507 E-mail: helle@brownwinick.com

2. INDIVIDUAL MANDATE • Individuals required to have health coverage or pay a penalty • 2014 – greater of $95 or 1% of household income • 2015 – greater of $325 or 2% of income • 2016 on - greater of $695 or 2.5% of income

3. INDIVIDUAL MANDATE (CONT.) • Qualified Coverage • Employer-sponsored group health plan • Grandfathered health plan • Certain government coverage • Ex: Medicare, Medicaid, CHIP, Tricare, VA • Health plans offered in the individual market • Other coverage recognized by HHS and Treasury • Catastrophic coverage if under age 30 or other exemption • Coverage purchased through Exchange (“Marketplace”) operating in the state

4. WHAT IS THE EXCHANGE? • Two Types • American Health Benefit Exchange for individuals and families • Small Business Health Options Program (“SHOP”) for small (under 50) businesses • A state may elect to combine both into one exchange

5. ESSENTIAL BENEFITS • Ambulatory patient services • Emergency services • Hospitalization • Maternity and newborn care • Mental health and substance use disorder services, including behavioral health treatment • Prescription drugs • Rehabilitative and habilitative services and devices • Laboratory services • Preventive and wellness services and chronic disease management • Pediatric services, including oral and vision care

6. COVERAGE LEVELS • Bronze (60/40) • Silver (70/10) • Gold (80/20) • Platinum (90/10)

7. SUBSIDIES • Potential subsidies for coverage purchased from Exchange • Premium assistance tax credits for individuals with income between 100% and 400% of the federal poverty level • FPL for family of 4 for 2013 is $23,550 • 400% = $94,200 • Cost-sharing subsidies for individuals with income up to 250% of the federal poverty level to reduce out-of-pocket costs for plans purchased through an Exchange • Not available if individual has affordable coverage available from employer that provides minimum value

8. EXCHANGE NOTICE NOTICE TO EMPLOYEES OF COVERAGE OPTIONS • Notifies employees of coverage options that will be available through state insurance exchange • Two model notices are provided on the DOL website – one for employers who provide coverage and one for employers who don’t. • A revised COBRA notice incorporating information about the exchange is also on the website • Deadline was October 1, 2013 • DOL recently clarified that the general $100/day penalty for noncompliance is not applicable to the exchange notice provision

9. EMPLOYER MANDATE • No requirement for small (under 50) employer to provide health coverage • Large (50+) employers will be required to provide coverage or pay a penalty • Delayed to 2015 • 2014 will be the measuring period for determining “large employer” status

10. Website: www.brownwinick.com Toll Free Phone Number: 1-888-282-3515 OFFICE LOCATIONS: 666 Grand Avenue, Suite 2000 Des Moines, Iowa 50309-2510 Telephone: (515) 242-2400 Facsimile: (515) 283-0231 616 Franklin Place Pella, Iowa 50219 Telephone: (641) 628-4513 Facsimile: (641) 628-8494 DISCLAIMER: No oral or written statement made by BrownWinick attorneys should be interpreted by the recipient as suggesting a need to obtain legal counsel from BrownWinick or any other firm, nor as suggesting a need to take legal action. Do not attempt to solve individual problems upon the basis of general information provided by any BrownWinick attorney, as slight changes in fact situations may cause a material change in legal result.