Broker blog from Delta Dental

Category: ACA update (Page 2 of 2)

Follow the latest news related to Health Care Exchange plans and the Affordable Care Act.

Plain language policy: States move forward to stabilize insurance markets

Join our guest blogger, Stephanie Berry, as she unpacks state reactions to the removal of the ACA’s individual mandate. 

Stephanie is a Senior Legislative and Policy Analyst based in Sacramento, California.

As we reported recently, ending the penalty for individuals who choose not to purchase medical coverage (the individual mandate) could further destabilize the individual market. However, state policymakers aren’t waiting for further federal action on the ACA — leading to a notably active regulatory year as states are taking matters into their own hands. Here’s a summary of activity:

Weakening ACA regulations

Idaho unveiled a plan that openly defies the ACA by announcing earlier this year that the state would allow health plans to be offered that don’t comply with the ACA’s regulations on pre-existing medical conditions, essential health benefits, annual caps on benefits, and other key tenets of the law. These plans, of course, would be quite a bit cheaper than ACA plans and are designed to attract younger, healthier individuals. Because Idaho announced its intention to skirt ACA regulations, the federal government responded that it would step in and enforce the law if the state followed through with its plan.

Similarly, the Iowa legislature enacted a bill that allows non-ACA compliant plans to exist by creating an exemption for plans offered by the Iowa Farm Bureau, an association that is meant to serve Iowa’s farmers. To pass federal muster these plans cannot be called health insurance and therefore, cannot be regulated by the federal government or the Iowa Department of Insurance. It is likely that we will see other states follow suit.

Establishing reinsurance programs

Several states have introduced legislation to create state reinsurance programs — a way for carriers offering individual health insurance to get compensated for covering high healthcare costs. While bills are making their way through the legislatures in Louisiana, New Jersey, and other states that would require the state to apply for a federal waiver, Maryland has already enacted legislation that will support a reinsurance program by levying a surcharge on medical and dental carriers. This enacted legislation was designed to mirror the federal tax that was suspended for 2019.

Imposing state individual mandates

Finally, state legislatures — particularly those with state-based exchanges — are attempting to impose their own individual mandate that would require individuals to maintain health care coverage or pay a penalty. Legislation has been introduced in Connecticut, Vermont, New Jersey, Maryland, and Washington, but currently, only New Jersey’s bill — AB 3380 — appears close to enactment, while the bill in Washington has already died. It remains to be seen whether these individual mandate bills will be able to gain more traction this year or next.

Stay tuned for more health care policy updates from Delta Dental, and get to know our policy experts.

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Policy pops: How tax reform may affect dental enrollment

3‑minute read

Join our guest blogger, Devin McBrayer, as she unpacks the Job and Tax Cuts Act of 2017 and its likely effect on dental benefits enrollment. Devin is a Legislative and Policy Analyst based in Sacramento, California.

government workers walking down stairs

When most people think of the Affordable Care Act (ACA) and the increase in Americans with insurance coverage, medical insurance is the first thing that comes to mind. What’s sometimes overlooked is the significant growth in dental insurance, particularly among adults.

Pediatric dental is considered an “essential health benefit” in the ACA, meaning insurance must cover it. Dental carriers are also able to offer stand-alone family dental coverage on the health insurance exchanges as long as the pediatric benefits are included. This has made dental coverage more widely available to the 1.9 million people who purchased stand-alone dental coverage through the marketplaces in 2017.

Dental coverage could be threatened, however, due to the Job and Tax Cuts Act of 2017. This bill effectively repealed the mandate requiring most Americans to have health insurance by eliminating the financial penalty for lack of coverage.

Without the individual mandate, it’s likely that medical and dental insurance enrollment will decrease in the coming years. The Congressional Budget Office, a non-partisan agency that conducts analyses for Congress, predicts that the U.S. will have 8–13 million more people living without health insurance by 2026.

Stand-alone dental plans on the exchanges in particular will struggle to sustain enrollment in the marketplace, because stand-alone dental plans cannot be purchased unless an individual has already purchased a medical plan. If consumers choose not to purchase medical insurance because they no longer have to pay the penalty, then those consumers will also not be able to purchase dental on the exchange.

Adding more strain on the uncertain future of the exchanges, heathier and younger people who believe that they do not need insurance are most likely to drop their coverage. The exchanges could soon face a scenario where older or sicker individuals will choose to keep their coverage, and healthier, younger people will choose to drop their coverage. An unhealthy risk mix, due to healthier people leaving the exchanges, would likely cause health insurance premiums to rise even higher.

On the bright side, open enrollment totals for health insurance exchanges in 2018 exceeded expectations. Nearly 65% of state-based exchanges saw an increase in their overall enrollment. Only time will tell if the exchanges can sustain their enrollment, while also maintaining a healthy risk mix, after the tax reform bill repealed the individual mandate.

Despite the uncertainty facing the marketplace, Delta Dental is still working hard to ensure that consumers continue to have access to the dental care that they need.

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The three R’s, and why dental shouldn’t be left out

Repeal, replace or repair? These are the three R’s dominating the news in recent weeks about how U.S. Congressional Republicans want to overhaul the Affordable Care Act.

Republicans, who represent the majority in both the House and Senate, have an opportunity to rewrite the health care law, but are generally split into three camps on how to do so: Repeal the whole law now and replace later, perhaps incrementally; repeal once a complete replacement is ready; or repair the ACA for now, then determine what to do next.

Regardless of which strategy they select, something new is on the horizon, and Delta Dental is working to ensure dental benefits aren’t left out of the discussion.

About 1 million previously uninsured Americans today have affordable dental coverage as a result of dental benefits sold in public health exchanges, while employer-sponsored plans continue to enjoy tax-exempt coverage. Since our mission is to advance dental health and access to care, we want to preserve this progress in whatever legislation may come.

To this end, here’s what we’re telling lawmakers:

  • Allow people with exchange dental coverage to renew those policies with the carriers they’ve selected—whether or not those marketplaces continue—to minimize disruption.
  • If a new law includes tax credits to help eligible Americans purchase benefits, let those credits be used for dental as well as medical coverage.
  • Keep the tax-exempt status for employer-sponsored dental benefits; expand that exemption to allow individuals to pay dental premiums with tax-free dollars.

Whether repeal, replace, or repair, the key “r” word for Delta Dental is ready.

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Dental and the ACA in 2017

New reports speculating on the future of the Affordable Care Act have come out almost daily since America elected Donald Trump to be the next president. Here at Delta Dental, our leadership involved with health care reform breaks down what all the hubbub may mean for the dental benefits industry in 2017.

Clients and enrollees won’t feel effects of any major changes for a few years

No “significant change to the health care market — medical or dental” is expected for three or four years, says Jeff Album, Delta Dental’s vice president of Public and Government Affairs.

“Repeal and replace has changed to repeal and delay,” Album says. “It’s clear that both Congress and the new administration are going to want to minimize disruption to the existing system.”

Album expects Congress will take action early in 2017 to defund parts of the law, but postpone when that takes effect. In the meantime, lawmakers will determine how the replacement will look.

As the new law is developed, he says, Delta Dental will take an active role by helping the industry “define its advocacy agenda” in terms that best serve existing and prospective customers’ needs.

Health Insurance Tax could be modified or repealed in 2017

Early this year, Album says, Congress will likely seek to find common ground on the future of taxes associated with the law, including the Cadillac tax and the health insurance tax (HIT). The HIT tax, charged to insurance carriers based on premiums earned, was put on a one-year moratorium for 2017.

The fate of the HIT is the “biggest question” this year for the Actuarial and Underwriting departments at Delta Dental as they prepare for 2018, says Tom Leibowitz, vice president and chief actuary.

Overall, Leibowitz says he expects rates for dental benefits will continue to stay largely stable for 2018.

“Unlike health care, dental had fairly small impact on rating requirements from the ACA,” he says, “so those huge cost increases that have been seen on the public exchanges for medical are not taking place in the dental world.”

Public exchanges are sticking around for now, and Delta Dental will stick with them

Delta Dental and its affiliate companies have already started work on 2018 exchange plan offerings.

“We are committed to the exchanges as long as they’re a viable platform through which we can sell standalone pediatric and family dental plans,” says Andrea Fegley, vice president of Legal & Regulatory. “Participation in public health care exchanges aligns well with our mission to advance dental health and access.”

Public exchange benefit offerings complement Delta Dental’s existing business strategy, adds MohammadReza Navid, vice president of Sales.

“Regardless of the ACA’s future, Delta Dental will continue to find innovative ways to increase dental access for all,” Navid says.

Both agreed that the company’s planning and strategic initiatives will keep Delta Dental at the forefront of the industry.

What you should know about exchange dental benefits

It’s the fourth year of open enrollment on the public health care exchanges, and your clients probably still look to you to help them navigate the new marketplace.

Find the right exchange dental plans for your individual or small business clients by evaluating the pros and cons of stand-alone dental coverage.

Pediatric dental benefits embedded in a medical plan are often subject to high deductibles (except in California).

Dental expenses in such plans usually aren’t covered until a combined medical-dental deductible (often in the thousands of dollars) is met. Check the plan’s details to determine if certain categories of dental services are waived from the deductible. In a stand-alone plan, certification requirements ensure that only a small deductible, if any, must first be satisfied.

Stand-alone dental coverage is typically worth the premium—even if enrollees only go for twice a year exams, x‑rays and cleanings.

The premium for a stand-alone HMO dental plan usually costs less than two checkups at the dentist each year without insurance. PPO dental coverage costs more, but can still pay for itself with just two visits per year. With both types of dental plans, cleanings, exams and x‑rays are often covered at 100% or no copay. If more expensive care is needed, the cost savings only grow from there.

Individuals enrolled in a stand-alone dental plan can clearly benefit from cost savings and improved oral health. Small businesses, meanwhile, can offer meaningful benefits that can save employees money while meeting Affordable Care Act coverage requirements.

Want more insight? Check out the Delta Dental guide to Health Care Reform for Brokers and Consultants.

See what Delta Dental offers in your marketplace by visiting healthcare.gov or your state-based exchange.

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