Pub. 1 2010 Issue 2

summer 2010 19 O n March 23, 2010, President Obama signed into law the health care re- form bill, the Patient Protection and Affordable Care Act. This legislation, along with the Health Care and Educa- tion Reconciliation Act of 2010, makes sweeping changes to the U.S. health care system. E mployers : Small businesses can receive tax credits if purchasing insur- ance for employees. Insurers : Cannot impose pre-existing condition exclusions on coverage for children. Must cover preventive services without copays. Cannot remove cover- age when a person becomes ill. Cannot impose lifetime coverage limits. Early retirees : Employers will be able to participate in a reinsurance program to help provide coverage for retirees and their spouses, surviving spouses and dependents over age 55 and not eligible for Medicare. Medicare Part D enrollees : A $250 rebate check received for those entering the “doughnut hole” gap in coverage in 2010. Rebate payable by April 1, 2011. Uninsured : Individuals with pre- existing conditions receive immediate access to coverage through a high-risk pool. Dependent children can remain on parents’ plans until age 26. 2011 Insurers : Required to spend at least 80 percent of premiums on medical services. Medicare Part D enrollees : Receive a 50 percent discount on brand-name prescription drugs when in doughnut hole coverage gap. Over-the-counter drugs : Except for in- sulin OTC drugs without a prescription are not reimbursable from an FSA or HRA, and are not a tax-free reimburse- ment from an HSA. Those with health care savings ac- counts : Federal tax on those who spend health care savings account money on ineligible medical expenses increases to 20 percent. W-2 : The value of your health coverage must be disclosed on your W-2 form. 2012-2013 Taxpayers : Medicare payroll taxes increase to 2.35 percent for individuals earning more than $200,000 and fami- lies earning more than $250,000. Those with flexible savings accounts : A federal limit of $2,500 for individual pretax contributions per year. 2014 Employers : Companies with 50 or more employees must provide affordable cov- erage or pay a penalty. Insurers : Prohibited from refusing to sell or renew policies. Cannot deny coverage for adults with pre-existing conditions. Limits ability to set prices on the basis of sex, health status or other factors. Prohibited from imposing an- nual limits. Health Care Reform: Timeline & How Does it Affect Me Reform — continued on page 20