The Arc of Illinois

June 4, 2010

Leaders in The Arc:

We had a very productive meeting with the Director of the Illinois Dept. of Insurance, Wednesday. This presentation was, Health Care Reform & Non-Profit Employers.

I have done my best to summarize his comments but would urge you to begin meeting with your insurance agent and accountant to better understand the new health care reform law.

Tony Paulauski

The Arc of Illinois

815-464-1832

Director McRaiths Comments

IL Dept of Insurance.  Michael McRaith is the Director of the Illinois Dept. of Insurance. He has been the Director for the past five years. The Dept. regulates all insurance issued in Illinois including health insurance, auto, home, etc.

The mission of the Department of Insurance is to protect consumers by providing assistance and information, by efficiently regulating the insurance industry's market behavior and financial solvency, and by fostering a competitive insurance marketplace.

He encouraged us to visit his Dept. website for information on health care reform or insurance in general: http://www.insurance.illinois.gov/

Health Care Reform.  His presentation was on Health Care Reform and Its Impact on Non-Profit Employers.

Director McRaith assisted the Obama administration in drafting parts of the health care reform legislation. He had high praise for the President and his leadership on health care reform.

The Director indicated that the legislation is flawed because of the politics of building support for health care reform and the strong forces against reform. As a result, there are many unclear areas in the legislation that need to be work through in the next few years as the legislation begins to be implemented. He hopes individuals and organizations like The Arc share their comments and concerns with his department through their website.

Needless to say while many areas of the legislation are unclear, there is little doubt that health care reform makes health care for families infinitely better here in Illinois. This reform could not have been achieved in the State of Illinois on its own.

In Illinois, the Dept. of Insurance will be responsible for administering the new health care reform legislation.

There are five major components of the reform including:

1. Pre-Existing Conditions Exclusions
   
2. Rescissions
   
3. Lifetime & Annual Caps
   
4. Discrimination Based on Health Status
   
5. Guaranteed Issue & Renewability

The Director went on to explain these major components.

July 1, 2010 consumer protections will begin to kick in including external review of denials of health insurance coverage.

He believes that health care reform might not reduce our health care premiums but that it certainly will result in rate stability.

The U.S. Dept of Health & Human Services will be responsible for developing the rules and regulations for the health care reform legislation.

The health care reform will require a change in our current perspective in providing health care.

It is likely that there will be changes to this legislation and there are even efforts to repeal health care reform.

The Director also recommended we learn about and support the SHOP Act introduced by Senator Durbin.

Non Profit Employer Implications & Suggestions. 

1. 2014 is the year most of the employer requirements will be in place.
   
2. Small employers of 49 employees or less will not be required to offer health insurance.
   
3. A full time employee is someone who works 30 or more hour per week but there is also a formula that looks at how many part time employees an organization may have, so know the law.
   
4. Part time employees are not covered under health care reform.
   
5. Employers of 50 or more employees will be required to offer health care insurance to full time employees.
   
6. Employers of 50 or more will be required to offer their employees meaningful benefit based upon the real value of the health care insurance.
   
7. There will be subsidies for individuals and families up to 400% of the poverty level to purchase health care.
   
8. There are annual caps on cost sharing for individual and family coverage up to 400% of the poverty level.
   
9. Investigate rebates that might be available to your nonprofit as a non-profit employer. Rebates are available now for up to 25% of the premiums you pay if your organization qualifies.
   
10. Discuss the new law with your insurance carrier and accountant.
    
11. Begin now to evaluate the effect of changes on your current group health plan options.
    
12. Identify a strategy to address short-term and long-term changes.
    
13. Address cost and compliance issues.
    
14. Determine a communication strategy for your employees on health care reform.

Here is a link to the Directors PowerPoint summary of the health care reform legislation: http://www.insurance.illinois.gov/hiric/resources/HRTimelineImplementationl.pdf