Federal Healthcare Legislation and its Sweeping Changes

Implementation of federal healthcare legislation–the Patient Protection and Affordable Care Act (ACA)–has begun in Connecticut in preparation for Jan. 1, 2014, when many of the law’s requirements become effective. 

This is the first of a series of articles that will keep you up-to-date with how federal healthcare legislation will be implemented in the state. 

What do federal healthcare changes mean for Connecticut? 

Implementation of the Patient Protection and Affordable Care Act (ACA) will change how healthcare is offered and managed. In general, all U.S. citizens and legal residents will have to maintain a minimum set of health insurance benefits, and employers will have to comply with new coverage requirements, reporting obligations, and compliance regulations.

One of the steps taken by the State of Connecticut in response to passage of the wide-ranging Federal healthcare law was the formation of the Connecticut Health Insurance Exchange. While the federal law establishes baseline national healthcare requirements (such as dependent coverage for children up to age 26, which was already law in Connecticut), it also allows for state-specific policy, much of which will be determined by the state-appointed Health Insurance Exchange's board of directors.

What will the state Connecticut Health Insurance Exchange do?

The state exchange will operate as a marketplace where individuals and small businesses with up to 50 employees can purchase health insurance and coverage options. It’s important to note that the state exchange will not sell its own insurance plan but facilitate the purchase of health insurance through other entities.

The exchange is chaired by Lt. Governor Nancy Wyman and supported with a staff led by CEO Kevin Counihan, who was a key player in Massachusetts Connector (Massachusetts’ exchange). The Connecticut Exchange is funded with federal dollars through 2014.

What are some of the new healthcare requirements?

Minimum Health Benefits: Per the ACA, the Connecticut Exchange recently adopted an Essential Health Benefits (EHB) package that sets a minimum level of coverage for healthcare plans offered in the individual and small group market in Connecticut, both inside and outside the state exchange. The exchange’s EHB package includes all of the state’s more than 60 healthcare coverage mandates.

Penalties: Individuals, employers and employees whose plans do not meet the minimum requirements set by the state’s exchange will be subject to a new system of financial penalties.

Reporting and documentation:

·        Notification: The ACA requires a defined Standard Summary of Benefits to be supplied to employers and individuals.  (Note: This requirement applies to plan/policy years and open enrollments beginning on or after Sept. 23, 2012. See here for examples.)

·        Report: The ACA requires employers to report the cost of coverage under an employer-sponsored group health plan on an employee’s Form W-2.  

Just the beginning

As Federal healthcare legislation is implemented in Connecticut, CBIA will continue to shape business-friendly policy and keep our members informed of regulatory developments. 

Next: Dates for employers to know

For more information, contact CBIA’s Jennifer Herz at 860.244.1921 or jennifer.herz@cbia.com