Update, January 24, Multi-State Plan Program and Enrollment Snapshot: On January 22, 2015, the Office of Personnel Management (OPM) issued it’s draft Multi-State Plan (MSP) Program Issuer Letter for 2016. The draft letter notes that in 2014, the MSP Program offered more than 150 plan options in 30 states and the District of Columbia and covered approximately 371,000 individuals. For 2015 the MSP Program offers more than 200 plans in 35 states.
The draft letter is brief, and refers interested parties to the proposed rule issued by OPM for the MSP in November of 2014 for greater program detail. The letter specifically notes two program requirements imposed by the ACA: MSP Program plans must use the MSP Program external review process; and MSP Program insurers must offer at least one gold and one silver plan that do not cover abortions, except “where a pregnancy is the result of rape or incest, or for a pregnancy which, as certified by a physician, places the woman in danger of death unless an abortion is performed.” This is the standard for abortions that can be funded with federal funds at this time. Whether or not a particular MSP Program plan covers abortion must be disclosed in the plan Statement of Benefits and in all MSP documents.
On January 21, 2015, the Centers for Medicare and Medicaid released their enrollment snapshot for week nine of the 2015 open enrollment period, covering January 10 to 16. During that week, over 400,000 individuals selected plans through the federally facilitated marketplace, bringing total plan selections through the FFM to 7,156,691. Charles Gaba now estimates total enrollment in the marketplaces at 9.75 million with a month of open enrollment to go.
Update on ACA-related tax issues, January 22. The Internal Revenue Service has recently issued two releases relating to the implementation of the Affordable Care Act. First, Revenue Procedure 2015-15 establishes the monthly national average premium for a bronze plan offered through the exchanges for 2015 at $207 for an individual, $1035 for a family of five or more. This figure determines the maximum shared responsibility payment that will be owed by an individual or family — for failing to obtain minimum essential coverage or qualify for an exemption for a month in 2015 — if the individual or family is required to pay a penalty based on the 2-percent-of-income-above-the-filing-limit method.
The basic flat-dollar individual responsibility penalty for 2015 is $325 per adult, half that per child up to a maximum of $975 per family. However, higher-income individuals or families must pay 2 percent of their household income above the filing limit if that amount exceeds the flat dollar amount. The 2015 amount is marginally higher than the maximum penalty for 2014 or $204 per month per individual or $1020 for families of five or more. The maximum annual payment for 2015 will be $2484 for an individual or $12,420 for families of five or more.
The IRS has also released Notice 2015-8; this provides access to the small employer tax credit for small employers in the 84 of Iowa’s 99 counties in which no qualified health plans are available through the SHOP exchange in 2015. Otherwise eligible small employers in these counties can access the tax credit for 2015 by purchasing coverage that would have qualified for the tax credit prior to 2014, when it first became obligatory that coverage be purchased through a SHOP exchange. Small employers may, however, claim the tax credit for this coverage at the rate that became effective in 2014: 50 percent of the employer’s contribution (35 percent for nonprofits). This relief is the same as that granted last year to small employers in certain counties in Washington and Wisconsin where SHOP exchange coverage was not available
Update, January 16: On January 16, 2015, CMS announced the availability of three important resources that will help individuals comply with their ACA tax filing obligations. First, CMS is making available an online calculator that individuals can use to determine the lowest-cost bronze plan that was available to them in 2014. An individual who claims an affordability exemption from the individual responsibility requirement has to establish that he or she could not have afforded a bronze plan for 8 percent or less of modified adjusted gross income. The calculator will provide a determination of how much that plan would have cost. A tax filer can — by entering his or her zip code, the age of all family members, and information on months of employer coverage for any family member — receive a cost figure for the lowest cost bronze plan.
A second calculator provides the cost of the second-lowest-cost silver plan available to an individual. This cost will be needed for premium tax credit reconciliation if information on a 1095-A that a tax filer receives from a marketplace is incorrect because a tax filer who received a tax credit had an unreported change in his or her household (such as a baby born or a family member getting job-based coverage). It will also be needed if a qualified health plan enrollee did not apply for or accept advance premium tax credits during 2014 but wants to claim a credit at tax filing time. Finally, the cost of the second-lowest cost silver plan will be required by someone claiming an exemption from the individual responsibility requirement on the grounds that Marketplace coverage was unaffordable, as the cost figure is necessary to determine what premium tax credit would have been provided through the marketplace had the individual applied.
For this calculator the applicant will need zip code, age of each family member, and months during which a family member was covered or eligible for coverage outside the marketplace. Brian Haile and I in an earlier post had urged that CMS provide these calculators, and we are pleased that they have done so.
In another tax-related matter, the IRS announced that free-file is now available for 2014. Free-file makes free tax filing software from 14 tax software companies available to the 70 percent of Americans who earn $60,000 or less a year and makes free forms available to higher income filers. For 2014, free-file has been designed to assist taxpayers in complying with the new ACA tax filing requirements. ACA tax filing information is also available from the IRS. CMS has also released a tax filing fact sheet.
Finally, on January 16, 2015, CMS released the final 2016 actuarial value calculator and AV methodology. This information will be needed for calculating the metal level of 2016 health plans.
Original post: In the next few days, consumers who enrolled in qualified health plans through the marketplaces in 2014 will begin receiving IRS form 1095-As from the marketplaces, be they the federally facilitated marketplaces (FFMs) or state-operated marketplaces. The form 1095-A is the form that provides individuals who have enrolled in qualified health plans through the marketplaces the information they need to fill out form 8962, which in turn is the form enrollees will need to reconcile the advance premium tax credits (APTC) they received in 2014 with the premium tax credits they were actually entitled to. The marketplace also reports the information on the 1095-A to the IRS.
On January 12, 2015, HHS released a series of frequently asked questions about the 1095-A at its REGTAP website, which are reviewed below. This post also briefly covers other ACA-related developments. Read the rest of this entry »