Health Care Reform – Overview
On March 23, 2010, President Obama signed into law the Patient Protection and Affordable
Care Act (PPACA), making health reform certain and expanding coverage to many
Americans over the next several years.
At this point, it’s difficult to gauge the exact impact of this law on The College of Idaho, and
our employees, since many provisions are not effective until a few years down the road.
This update provides information as we understand it today.
The College of Idaho offers health care coverage to almost 177 employees and their
families at a total cost of approximately 1.6 million dollars per year. We anticipate that health
care reform will have some impact on our health care offerings and/or costs, and will keep
you updated as we have more information.
Here are some changes in the law that will affect our plans:
Beginning with our plan year that starts January 1, 2011:
Dependent children will be eligible for coverage until their 26th birthday, as long as they
do not have access to other employer coverage. This provision applies even if your child
is married, whether or not your child attends school full-time or lives with you, and
applies even if your child is not your tax dependent.
The plan will remove any caps on lifetime limits on most benefits, and some changes
may be made to annual dollar maximums on certain benefits.
Pre-existing condition exclusions for children under age 19 will be eliminated; these
exclusions will be eliminated completely beginning in 2014.
These new provisions enhance some of the benefit features of our plans, and yet will also
cost The College of Idaho money. In addition, you may experience some cost impacts
based on some new provisions of the legislation. For example, starting January 1, 2011:
If you participate in a Health Flexible Spending Account (FSA), a Health Reimbursement
Account (HRA) or a Health Savings Account (HSA), you will only be able to use money
in your account for those drugs that are prescribed by a health care provider, or for
insulin; over-the-counter drugs will no longer be covered.
If you have an HSA and use the money for nonqualified expenses, you will pay a 20%
penalty (instead of today’s 10% penalty).
Other provisions set to take effect over the next several years may also have an impact on
our costs and coverage. Some of the provisions you may have heard the most about — for
example, a mandate that everyone have health insurance and help for low-income people to
buy insurance — don’t take effect for at least three years. We will continue to follow the
legislative process closely and will keep you informed as we have more information and
have analyzed the impact to our employees and the company.