If you’re a regular reader of the AHCP blog, you know that we frequently stress the importance of client communications. Whether you focus your attention on employer, individual, or Medicare products, your customers need to understand their policies and keep up to date with important changes that could affect their coverage.

To help you with your communication efforts, we thought we’d give you three short client communication pieces, one for each market segment (employers, individuals, Medicare). Please feel free to email them to your customers or include them in your monthly newsletter.

For Small Employers

Title or Subject Line: Transition plans extended another year

As you may have heard, the Department of Health and Human Services recently announced that the transitional plan option is being extended for another year, through the end of 2019. That’s great news for employers that have a “grandmothered” health plan!

As a reminder, these transitional plans are not subject to all the rules of the Affordable Care Act. The biggest of these is the modified adjusted community rating rule, which states that insurers cannot discriminate based on gender or medical conditions and limits the amount they can charge for older workers relative to younger workers.

  • For companies with an employee population that uses their coverage more frequently, these rules can be beneficial since their premium is not based on the amount of health risk within their own employee population.
  • Unfortunately, companies with younger, low utilizing employee populations can pay more than the actual health risk within their own employee population as a result of the ACA’s community rating rules. With keeping a transitional plan, these companies are able to play by the old rules and pay a lower premium as a result.

One disadvantage of a transitional plan is that the company must continue to renew its existing plan year after year without any tweaks. Adjusting the calendar-year deductible or the out-of-pocket limit would disqualify the plan and force the company to purchase an ACA metallic plan if they want fully-insured small-group coverage.

If your company currently has a transitional plan, there may be another option. Try a “level-funded” plan from National General Benefits Solutions.  Level-funding allows employers to have a self-funded health care plan that is not subject to all the requirements under the Affordable Care Act, and the National General Benefits Solutions Self-Funded Program offers employers the ability to select multiple plan options for their employees. This solution could give you the flexibility you need at a price you can afford.

However, not every company will qualify for a level-funded plan, but you may be a good candidate. As we approach your annual renewal time, I’d like to provide you with a quote for a level-funded plan through the National General Benefits Solutions Self-Funded Program, we can compare the rates with your transitional plan renewal offer, and see if it’s a good fit. Either way, we’ll make sure that you’re offering the best benefits you can to your employees, at the lowest possible price.

For Individuals

Title or Subject Line: IRS overrules itself; increases HSA family contribution back to $6,900

If you have an HSA-qualified health plan, you may have received some conflicting information about this year’s family contribution maximum. That’s because the IRS has had a difficult time making up its mind about what that maximum will be:

  • In mid-2017, the Internal Revenue Service announced that the maximum individual contribution to a Health Savings Account would be $3,450 in 2018 and the maximum family contribution would be twice the individual amount, $6900.
  • In March of this year, the IRS announced that, as a result of the tax bill that was passed in December, the maximum family contribution was being reduced to $6850.
  • Following a significant amount of negative feedback about the reduction, the IRS announced in May that “taxpayers may treat $6,900 as the annual limitation on deductions under section 223(b)(2)(B) for an individual with family coverage under an HDHP.”

What this means is that, for 2019, you can go ahead and contribute the full $6,900 to your HSA if you have a High Deductible Health Plan covering you and at least one member of your family. If you started the year by making the full $6,900 contribution to your HSA and have already completed paperwork to remove $50 of that contribution from your HSA based on the previous IRS guidance, you can ask your HSA administrator for a “mistaken withdrawal” form if you’d like to put the $50 back into your account.

I know this is a bit of a hassle, but the good news is that this is not a common occurrence. Normally, the IRS announces the HSA contribution limits well in advance and doesn’t usually change its mind. Hopefully you are taking advantage of this great tax-saving opportunity and contributing as much as you are able to your HSA. It’s a great way to make sure that funds are available for future medical expenses.

For Medicare Beneficiaries

Title or Subject Line: When will I receive my new Medicare card?

You may have heard by now that the federal government is sending new Medicare cards with new Medicare numbers to all Medicare beneficiaries. This is being done for privacy purposes and to reduce the risk of identity theft. The new Medicare numbers will be randomly generated and will not be linked to your Social Security number.

Here are three things you need to know about your new Medicare card:

  1. People who are enrolling in Medicare for the first time will be among the first in the country to receive the new cards.
  2. Your new card will automatically come to you. You don't need to do anything as long as your address is up to date. If you need to update your address, visit My Social Security Account. 
  3. Once you get your new Medicare card, destroy your old Medicare card and start using your new card right away.

To learn more about the timing of the new Medicare cards, click here. Note that for most states the planned mailing date is “after June, 2018,” but the document does not clarify how long after June 2018 they will be mailed. Unfortunately, this is the best info we have at this time. All cards will arrive by April, 2019. If you’d like to receive an email when your new card is on the way, click here.

One last thing: if you sign up for a Medicare Advantage plan or Medicare Part D prescription drug plan, or if you purchase a Medicare supplement, you’ll be asked for your Medicare number. Just remember that zeros look a lot like a capital “O” and ones look a lot like a capital “I” or lower case “l”, so be sure to make it clear on your application what your new Medicare number is. That will help avoid potential processing delays.

If you would like to look at changing your current Medicare coverage or see what options are available to you, please contact my office – I’ll be happy to help.

Let us know what you think!

We hope you find these “done for you” pieces helpful. If so, please let us know. We’ll continue to create them as long as brokers are using them. If you have an idea for a specific “done for you” piece that you’d like us to work on, please share it here.