The Blind Leading The Visually Impaired

Thursday, November 18, 2010
The “grandfathered” rules have changed. Let the celebration begin! Ok, maybe not.

New information was released this week further detailing which companies can or can not remain grandfathered. This is an amendment to the interim final regulations that were issued on June 17, 2010 by the Department of Health and Human Services, the Department of Labor, and the Department of the Treasury.

This is the link to the thirty-five page summary.

This is the quick version of what changed: Businesses are now allowed to change insurance companies as long as nothing else substantially changes.

My posts of August 2nd and August 16th provided a quick list of requirements to retain your grandfathered status and how difficult that may prove to be. A key point of contention was that unions could change insurers, but small businesses and individuals could not, even if the insurance company left the market or made significant changes to its products. This amendment reverses that for businesses, but not for individuals. Heck, it’s a start.

The rules, this one, the set issued in June, and all future regulations, are subject to change or reversal. Long term planning is based purely on educated guesses.

The enforcement regulations and delineation of potential penalties will quickly follow.

My prediction: The forms, the cost to remain in compliance, and the penalties will all be far more expensive than simply opting out of private insurance for small business. Paying an annual “No Insurance” penalty (TAX) to the federal government will be cheaper and easier.

You are now up to date. This really is the blind leading the blind. No one really knows how this is going to play out. We are all guessing. Some of us may be better guessers than others, but no one really knows for sure. The recent election may have a real impact on the Patient Protection and Affordable Care Act or it may not change a thing. That can be said of every variable. All we can do, as business owners, as employees, as health care consumers, is to pay attention and hope for the best.

It is time to review the process.

March 23, 2010 – Congress passed and the President signed a far-reaching piece of legislation that affects 1/6 of our economy and the health and well-being of every American.
June 17, 2010 – The Departments of Health and Human Services, Labor, and the Treasury issued rules that apply to all business and individual health insurance policies, RETROACTIVELY from March 23, 2010. The rules also allowed for Public Comment.
June 17, 2010 – Some businesses and individuals learned that the changes they have made, or have been forced to make, preclude grandfathering from the new regulations. Businesses enact new plans accordingly.
November 16, 2010 – New rules. You might have been grandfathered after all, but now that you have made other changes, you aren’t!

Sometime in the next three to six months – Final rules will be issued.

Next Steps:
* Compliance
* Enforcement
* Penalties

Once the rules are final, how will the government and your insurance company know that you are complying? My guess will be FORMS. The Patient Protection and Affordable Care Act, with the onerous 1099 requirements, is a printer’s dream. Clients are already asking if there will be notarized affidavits required to certify their status. Not yet, but that could be coming soon.

Change can be useful. Change can be difficult. Ill-conceived, disorganized, rushed change is bound to cause unnecessary stress. Yes, this really is the blind leading the blind, but we appear to be going around in circles and there isn’t a whole lot any of us can do about it. Relax. Concentrate on your business. This isn’t war. Bullets aren’t flying. We will get through this. Together.

DAVE

www.bogartcunix.com