The document provides information about the Affordable Care Act and what it means for individuals and businesses in 2014. Some of the key provisions taking effect in 2014 include: - Individuals are required to have health insurance or pay a penalty. Subsidies will be available to help purchase insurance through state exchanges. - Businesses with 50+ employees must offer affordable health insurance or pay penalties. Small businesses can receive tax credits for offering employee coverage. - State-run insurance exchanges will offer individual and small group policies, and tax credits will help make premiums affordable for many. Essential health benefits must be covered.

1. Ready, Set, Let’s Go!
What Obamacare Means for
Individuals and Business
Owners
October 2013
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2. Health Care Funding by Source
Where do Americans get their health insurance?
•Government policy since World War II has encouraged use of health insurance
benefits as a way of increasing wages without increasing taxation. Employer
contributions are tax deductible for the employer and not taxed as income for the
employee.
•Government-paid health care benefits are not taxed as income to beneficiaries.
•In 2014, the playing field will be leveled for those who must buy their own insurance
– advance tax credits may be used to help pay insurance premiums.
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Source Percentage
Employer-sponsored 58%
Government: Medicare, Medicaid,
Veterans Administration, Military, Other
32%
Individual purchase or Uninsured 15%

3. The Patient Protection and
Affordable Care Act
On March 23, 2010, President Obama signed the Patient
Protection and Affordable Care Act into law.
The first provisions of the law became effective
September 23, 2010.
Complete implementation of the new law was planned
to occur over a five year period.
Insurance Exchanges or Marketplaces for individuals and
small businesses open for business January 1, 2014.
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4. The Supreme Court Decision
On July 24, 2012, the Supreme Court upheld the Patient Protection and
Affordable Care Act with its requirement that individuals buy insurance (the
“individual mandate”). The Court ruled that the mandate falls within
Congress’ ability to impose taxes.
The Court also ruled that the penalty for States that refuse to expand
Medicaid coverage for low income people was excessive and could not be
enforced. The penalty as written would have eliminated the entire existing
Federal contribution to Medicaid for non-compliant states. The option
remains to change the terms of the penalty for States that do not participate
to make it reasonable and therefore acceptable. (Medicaid is known as
“Medi-Cal” in California.)
While many states opted not to expand Medicaid, the Patient Protection and
Affordable Care Act was upheld as constitutional and is the law of the land.
AKR, Inc. – 2013

5. Affordable Care Act
Provisions Already in Place
Insurance provisions of the Affordable Care Act (ACA) apply to new policies
written after September 23, 2010. Effective dates of other provisions will phased
in through 2015, with most becoming effective January 1, 2014.
Insurance Policy Changes:
1.No lifetime limit on coverage.
2.Annual coverage limits restricted – None allowed after 2014.
3.No denial of coverage for children with pre-existing conditions.
4.Young adults, up to age 26, may obtain health insurance through their parents’
plan.
5.Insurers cannot drop coverage when an insured becomes ill.
6.Free coverage for comprehensive preventive services for women began August
2012.
7.Preventive exams and care in policies are not subject to deductibles or copays.
8.Premium rebates from health insurance companies that did not spend at least
80-85% of premiums received to provide benefits for their policyholders began
to be sent to consumers during Summer 2012.
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6. More ACA Provisions Already in Place
Community health
•Expansion of state Medicaid programs with Federal subsidies
•Incentives for health care professionals to become primary care providers.
•Increased access to home-based and community center-based care.
•Programs in place to:
o Improve access to health care information,
o Expand community health center programs,
o Support rural health programs,
o Improve record-keeping and health care quality
Medicare
•Closure of the “donut hole” in Medicare Prescription Drug plans has begun – will occur in
increments through 2020
•Steps to reduce waste and fraud in Medicare programs
•Expanded coverage for early retirees
•Strengthening of Medicare Advantage programs while eliminating overpayments to
private insurers for such plans.
•Improved follow-up care for Medicare patients
Businesses
•Small Business Health Care Tax Credit for businesses with 25 or fewer employees.
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7. TEN FACTS ABOUT OBAMACARE/ The ACA
1. No lifetime limit on coverage for 105 million Americans
2. Up to 17 million children with pre-existing conditions can no longer be denied
coverage by insurers.
3. 6.6 million young adults up to age 26 have taken advantage of the law to
obtain health insurance through their parents’ plan.
4. Free coverage for comprehensive preventive services for millions of women
started in August 2012.
5. 86 million Americans, including 32 million seniors in Medicare, have already
received free preventive services.
6. 5.3 million seniors have already saved $3.7 billion on their prescriptions drugs.
7. Since the health care law was enacted in March 2010, 4.2 million private sector
jobs have been created – many of them in the health care industry.
8. The Small Business Health Care Tax Credit has already been used by 360,000
small businesses to help insure 2 million workers.
9. Approximately $1.1 billion in rebates from health insurance companies in 2012
benefited nearly 13 million Americans.
10. The health care law is projected to reduce the deficit by $124 billion over the
next 10 years and over $1 trillion over the following decade.
Source: DCCC.ORG/Obamacare Benefits already received by Americans by mid-2012
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8. Affordable Care Act
2014 Changes to Health Coverage
2014 Health Coverage Changes
•Insurance Market Reforms
•Health Insurance Requirement – The Individual Mandate
•Affordable Coverage and Financial Support
•Health Insurance Marketplace – The Exchanges
•New Coverage Options for Small Businesses – SHOP
•Expansion of Medicaid (Medi-Cal in California)
•Essential Health Benefits
•Use of Standard Health Plan Options – Metallic Tiers
•Basic Coverage Plan – Catastrophic care policy for those under age 30
•Child Only Plans
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9. Essential Health Benefits
Effective January 1, 2014, all new health insurance plans must
include coverage for the following Essential Health Benefits:
1.Ambulatory patient services
2.Emergency services
3.Hospitalization
4.Maternity and newborn care
5.Mental health & substance abuse disorder services, including behavioral
health treatment
6.Prescription drugs
7.Rehabilitative and habilitative services and devices
8.Laboratory services
9.Preventive and wellness services & chronic disease management
10.Pediatric services
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10. The Affordable Care Act in California
California is cooperating fully with implementation of
the Affordable Care Act (ACA).
•All of the provisions on the prior slides have been
implemented in California.
•Additionally, California was the first state in the nation
to enact legislation creating a health benefit exchange
under federal health care reform.
•In advance of ACA requirements to offer maternity care
as an Essential Health Benefit by 2014, all newly written
policies in California as of July 1, 2012 include maternity
care.
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11. January 1, 2014
Full Implementation Begins
• Insurance companies may neither deny coverage nor increase premiums
based on pre-existing conditions or development of illness or injury.
• Individuals and families are required to have health insurance unless
exemptions apply.
• Insurance may be obtained through new or existing employer group
policies, individual policies, state exchanges, or governmental programs
including Medicare, Medicaid, Veterans Administration, military plans, or
TriCare plans.
• Exempt individuals include but are not limited to:
o Persons with religious objections
o Persons for whom purchase of a policy would be a hardship
o People not required to file income tax reports
o Persons permanently incarcerated
o Members of Native American tribes and Alaska Natives
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12. State Exchanges - 2014
• All states must have exchanges/marketplaces for health insurance
policies. As of October 2013, 17 states and the District of Columbia,
have developed their own marketplaces. The others have a
partnership arrangement with the federal government or federally-
facilitated marketplaces. California operates its own marketplace.
• Many major health insurance providers are offering policies through
Covered California.
o Policies offered through the exchange must include the federally
specified Essential Health Benefits.
o Policy premiums must be no higher than those for a healthy person of
the same age as the insured, regardless of sex of the insured.
o Tax credits will be used to provide a subsidy for middle and lower
income purchasers of insurance through the exchanges.
 Much of the increased staffing of the IRS will be put in place to ensure
people know about and get the credits for which they qualify.
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13. The Affordable Care Act for
Business Owners
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14. 2014 Requirements for Employers
• Employers with 25 or fewer employees
o Not required to provide health insurance
o Tax credits available to help with the cost of insuring employees
• Employers with 50 or fewer FTE employees
o Not required to provide health insurance
• Employers with 51 or more FTE employees
o Must sponsor affordable health insurance plans for their employees
o Penalties of $2,000 per employee annually apply for those who do
not provide affordable coverage
o Penalty provision excludes the first 30 employees
o If coverage is too expensive, employees may purchase coverage
through the state exchanges. Employer will be required to pay a
penalty to reimburse some of the administrative costs of the policy.
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15. Full-Time, Part-Time and Full-time Equivalents
• Calculation of number of employees includes part-
time employees.
• Full-time refers to employees who work 30 hours per
week or more.
• Part-time employees are those who work 20-29 hours
per week. Their hours are combined and then divided by
30 to determine the number of full-time equivalent
employees of a business.
• Businesses are not required to offer coverage to part-
time employees, but they must count employee hours in
determining their requirement to provide employee
health care.
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16. Affordable Coverage for Employees
• Coverage provided by employer-sponsored policies must be
affordable for employees.
• “Affordable” policies are those for which employee
contributions cost 9% of their income or less when coverage
contributions are made by employers for employees only.
• Minimum employer contribution is 50%, but employers may
choose to contribute any amount in excess of 50%.
• Employers are not required to contribute towards coverage
for employee dependents.
• When dependent coverage is offered, total employee cost
must be 8% or less of employee wages to be deemed
“affordable.”
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17. When Coverage is not “Affordable”
• If employee share of the cost of an employer sponsored
health plan is not “affordable,” the employee is eligible to
purchase a plan from the exchange marketplace, with
possible subsidy. The employer may pay a penalty for failure
to provide affordable insurance.
• Employees who work fewer than 20 hours weekly are not
included among those whose insurance employers must
sponsor. Such employees may purchase insurance from the
exchange marketplace. Many will qualify for expanded Medi-
Cal.
• If dependent care is not offered by an employer, employees
may be able to purchase subsidized insurance for their
dependents through the exchange marketplace.
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18. Tax Credits for Small Employers
• Beginning in 2014, small business employers must purchase
coverage for their employees through their state exchange in
order to receive a tax credit for their contributions to the cost
of the premiums.
• Percentage of the premium covered by the tax credit will be
increased in 2014.
• Small group policies may be purchased during Open
Enrollment from October to December or throughout the
year, when business plans would normally be renewed.
Employees will have open-enrollment periods at renewal as
they do now.
As always, if you are a business owner, consult your tax adviser for information and advice specific
to your business situation. AKR, Inc. – 2013

19. Employers:
Different Sizes – Different Requirements
• Fast food franchisees are exempt from providing the same
types of coverage other employers must offer. Many are also
exempt because they have fewer than 50 FTE employees
• In 2015, businesses with up to 100 employees will be able to
purchase insurance through the Small Business Health Option
Program (SHOP). For 2014, the limit is 50 employees.
• Companies with 200 or more employees are classified as
“large groups” in the insurance market. They must provide
coverage.
 99% of companies with 200 or more employees already provide
coverage. They’ve found that keeping employees healthy
improves their “bottom line.”
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20. Will I Get a Tax Credit?
To qualify for a tax credit, an employer must:
•Purchase coverage for employees through the SHOP marketplace
beginning in 2014.
•Have fewer than 25 FTE employees for the tax year.
•Pay combined average annual wages that don’t exceed $50,000 per
employee.
•Contribute at least 50% of employee premium costs. Add-on coverage
contributions must also be funded at the same minimum level.
Employers with under 10 FTE employees whose wages average under
$25,000 annually may qualify for the maximum tax credit if they
contribute at least 50% towards employee premium costs.
A tax credit calculator is available on www.coveredca.com to help business owners estimate tax
credit amounts. Consult your tax advisor regarding your specific case.
AKR, Inc. – 2013

21. I’m a Small Business Owner,
Where Do I Go to Buy Coverage?
Employers have options:
•Buy insurance on the private market. Keeping current “grandfathered” insurance
policies in force is an option. New policies will also be available on the private market.
•Buy insurance through private exchanges.
•Buy insurance through Covered California’s SHOP (Small Business Health Option
Program).
•Contribute a fixed amount to employees and allow them to shop for their own
coverage. Caution: This option applies only to those with fewer than 50 FTE employees.
– If under 50 FTE employees, employers are not required to provide health
insurance coverage for their employees. Employees may go to the Individual
Marketplace for coverage and find more affordable options
•Go to the Individual Marketplace: “Mom & Pop” enterprises with no W-2 employees
may qualify for subsidies on the Individual Marketplace. No business tax credits are
applicable for these business owners.
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22. Is There an Advantage if I Buy Coverage
for my Employees through SHOP?
Purchasing Employee Health Insurance Through SHOP offers
many advantages to employers.
•Greater potential selection of policies for employees:
Employees can purchase a policy from any company offering one
in the Tier selected by their employer. If they prefer a more
expensive policy, they can pay the difference in price
themselves.
•Greater predictability and control of costs: Employers choose a
Tier of policies and select the percentage of employee premium
cost they will pay. Employer contribution is set at the employer’s
chosen percentage of the premium for the lowest cost policy in
that Tier.
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23. More Advantages
to Buying through SHOP
• A Larger Pool of Employees Covered: Employers are able to
purchase policies based on a larger risk pool. This larger pool and
more competition among insurers for your business leads to the
potential for lower prices. No more price uprating for being a smaller
business.
• Potential tax credits: Small employers who are not required to offer
coverage but do so anyway may qualify for credits on their income
tax return to help them cover the cost of insuring their employees.
• Happier, healthier employees: Employees who get preventive care
and can afford to consult a doctor when they are not feeling well are
more likely to remain healthy, recover more quickly from illness or
injury, and be more loyal to their employers. If this were not the
case, large employers would not offer this benefit to their
employees!
AKR, Inc. – 2013

24. What is Employee Choice?
Employee Choice is a feature of the Affordable Care Act that allows
employers select a level of coverage from the metal tiers and identify the
total amount of money they will contribute to pay for insurance for each full
time employee. This type of arrangement is known as a defined contribution
and provides advantages both to employers and to employees.
If an employee chooses a policy that is more expensive than the least
expensive policy available on that tier, the employee will pay an extra share
of the premium.
Through Employee Choice, employers can predict more closely their total
cost for health insurance benefits. Employees can select a policy that more
closely meets their needs from among a larger selection of companies and
policies.
Employee Choice is not required nationally by federal law until 2015.
However, California has chosen to implement this provision in 2014 to help
make it more affordable for employers to offer health insurance to
employees.
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25. The Affordable Care Act for
Individuals and Families
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26. 2014 Requirements for Individuals
• Individuals and families must have health insurance.
• Subsidies in the form of income tax credits begin for middle-income
Americans.
o If no affordable employer policy available
o Plans may be purchased through the exchanges
o Household income between 138-400% of the federal poverty level (FPL) –
qualify for federal subsidies to pay for premiums and/or cost sharing
obligations – estimated based on 2013 income projections
o Individuals and families at 100% to 138% FPL will qualify for Medicaid
(Medi-Cal in California), which will be expanded to include adults with no
children at home and low-income Medicare beneficiaries.
Premium Subsidies 138% of FPL 400% of FPL
Individual $15,852 $45,960
Family of 4 $32,496 $94,200
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27. 2013 Annual Income for Subsidy by Household Size
*Add $4,020 for each additional family member to calculate 100% FPL for larger families.
The Federal Poverty Level (FPL) is adjusted annually. Figures on this chart are for the 48 contiguous states.
FPL for Alaska and Hawaii is higher. Most recent figures are available at: http://
www.familiesusa.org/resources/tools-for-advocates/guides/federal-poverty-guidelines.html
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Household Size 138% FPL 250% FPL 400% FPL
One $15,852 $28,725 $45,960
Two $21,408 $38,775 $62,040
Three $26,952 $48,825 $78,120
Four $32,496 $58,875 $94,200
Five $38,052 $68,925 $110,280
Six $43,596 $78,975 $126,360
Seven $49,140 $89,025 $142,440
Eight* $54,684 $99,075 $158,520

28. 2013 Monthly Income for Subsidy by Household Size
*Add $335 for each additional family member to calculate 100% FPL for larger families.
The Federal Poverty Level (FPL) is adjusted annually. Figures on this chart are for the 48 contiguous states.
FPL for Alaska and Hawaii is higher. Most recent figures are available at:
http://www.familiesusa.org/resources/tools-for-advocates/guides/federal-poverty-guidelines.html
AKR, Inc. – 2013
Household Size 138% FPL 250% FPL 400% FPL
One $1,321 $2,393.75 $3,830
Two $1,784 $3,231.25 $5,170
Three $2,246 $4,068.75 $6,510
Four $2,708 $4,906.25 $7,850
Five $3,171 $5,743.75 $9,190
Six $3,633 $6,581.25 $10,530
Seven $4,095 $7,418.75 $11,870
Eight* $4,557 $8,256.25 $13,210

29. Tax Penalties
for Individuals Refusing to Buy Insurance
• Penalties will be incurred by persons who refuse to purchase a health
insurance policy in violation of the Individual Mandate.
• Penalties will be phased in from 2014 -2016, then indexed based on the
annual increase in cost of living.
• The penalty tax will be assessed through the individual income tax filing
process.
• The penalty tax is assessed per individual for whom the tax filer is
responsible, with a maximum cap of 300% of the individual tax.
2014 2015 2016
Per Individual $95 $325 $695
Max. per Family $285 $975 $2,085
or
% of Household
Income
1.0% 2.0% 2.5%
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30. Enforcement of the Penalty
• Premiums paid for purchase of insurance will be reported as part of normal
income tax filing.
• The tax for failure to have a health insurance policy is a penalty tax rather
than a normal income tax. The IRS cannot go after the assets or pursue
normal collection activities if a taxpayer does not pay it. However, the IRS
can and will collect the penalty from taxpayer refunds and will send
demand letters for payment to those who are not owed a refund.
• Individuals covered by Medicare, Veterans benefits, Tri-Care, employer
group policy, or other source of insurance that offers benefits equal to the
Minimum Essential Benefits at an affordable premium are not subject to
the penalty
• Low income persons who are covered by Medicaid (Medi-Cal) are not
subject to the penalty.
• Individuals exempted from the requirement to have insurance are not
subject to the penalty.
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31. The Affordable Care Act for
Everyone
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32. Bronze, Silver, Gold, Platinum?
Sounds Expensive! What’s this all about?
Health Insurance plans under the Affordable Care Act are classified by
“actuarial value.” Actuarial value is a technical term that describes how much
of the cost for health care an insurer will pay and how much a plan member
will pay. Bronze, Silver, Gold and Platinum are the terms selected to
distinguish four levels of actuarial value for policies offered by insurers on the
exchange marketplaces.
Within each level, a slight variation may exist in the actual share paid by
insurer versus consumer. Insurance companies may offer one or more
policies at each level of actuarial value. AKR, Inc. – 2013
Bronze Silver Gold Platinum
Plan Pays 60% 70% 80% 90%
Consumer
Pays
40% 30% 20% 10%

33. Consumer Share of Cost
The consumer’s share of cost includes:
Deductible: A fixed amount that must be paid by the consumer for health
care costs before the insurance company begins to pay a portion of the cost.
Co-payment: A fixed amount paid for a covered health service, generally at
time of service. This amount may vary based on the type and location of
service received.
Co-insurance: A percentage of the cost of health care services paid by the
consumer. The insurer pays the balance.
Premium payments and excess charges paid because care was purchased
outside of plan networks are not included in the calculation of consumer
share of cost.
As a general rule, larger consumer share of cost results in lower policy
premiums.
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34. Grandfathered Plans?
March 23, 2010 is the magic number here.
Any policy purchased before March 23, 2010 and not changed substantially since
that time is considered “grandfathered” and not subject to many of the new
coverage and eligibility requirements of the Affordable Care Act. Moving from a
lower to a higher deductible level of the same policy is one type of change that
does not end a “grandfathered” status.
This is good, right?
–Maybe, maybe not. Many grandfathered policies do not provide all of the
Essential Health Benefits found in ACA-compliant policies. For example, prior to
July 2012, many policies in California did not include Maternity care. This
requirement was not changed by passage of the Affordable Care Act.
–As the number of businesses and individuals with these policies is reduced over
time, the risk pool on which premiums are calculated will also be reduced. The
price of these policies can be expected to rise faster than that of non-
grandfathered policies available on the private market or through the exchange
marketplace.
AKR, Inc. – 2013

35. Where Can I Get Coverage?
• Both Individual and Employer-based coverage are available through
Covered California. Consumers and employers who purchase
policies through the Exchange Marketplace may receive tax credits
to help make them more affordable. Only policies purchased
through the Exchange qualify for tax credits as of 2014.
• Anyone can buy insurance through the Exchange, even those who
do not qualify for a tax credit.
• Consumers who prefer to purchase coverage directly from private
insurers off the Exchange may do so. No tax credits may be claimed
for purchase of these off-Exchange policies.
– Policies will be available that are identical in benefits and pricing to those
offered on the Exchange.
– Other policies may be offered outside the Exchange that provide more
coverage or broader provider networks, but at a higher price.
AKR, Inc. – 2013

36. How will Off-exchange policies differ?
Each company offering policies on the Exchange will also be
offering policies equivalent in benefits and price on the
private, off-Exchange market.
Companies may also offer more expensive policies that may
have larger networks or coverage for non-essential health
care benefits.
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37. Can I Have an Agent?
Yes. Covered California encourages consumers to select agents with
whom to work.
Finding an agent:
•Insurance agents must complete a certification program and be
appointed with Covered California in order to sell policies through the
Exchange Marketplace.
•Once an agent becomes a Certified Insurance Agent, the agent’s
name will appear on the Covered California website in a drop-down
box.
•Selecting the name of an agent begins the process of
designating/selecting an agent with whom to work.
•Agents accept designation as an individual or employer’s agent and
will contact the new client to establish a working relationship.
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38. Do I have to use an agent?
No one is required to use an agent in purchasing a policy
through the Exchange. In fact, computer-savvy customers may
prefer not to use an agent.
Never-the-less, a policy does not cost less without an agent than
one purchased in consultation with an agent.
If questions arise, a Certified Insurance Agent is trained and
prepared to explain the pros and cons of different policy options
and work on behalf of a client when questions or claims arise.
Additionally, Certified Agents can help business clients manage
their employee census and submit necessary verification
documents.
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39. When Can I Buy a Policy?
2013: Open enrollment begins October 1 and continues until March 31, 2014.
For coverage to begin on January 1, 2014, a policy must be purchased by
December 15, 2013.
2014: Open enrollment begins October 15 and continues until December 7,
2014
Special Enrollment Periods: Occur when specific life changes occur, including
marriage, birth of a child, loss of a job, etc. Consumers are allowed to
purchase a new policy or change policies during these periods.
Note: Outside of these open enrollment or special enrollment periods,
individuals may not purchase a policy, regardless of need.
Small Business group policies: May be purchased during Open
Enrollment or when the group’s plan would normally renew.
Employees are enrolled or removed from the policy as they normally
would be during the course of the year.
AKR, Inc. – 2013

40. Why Should I Buy
Through the Exchange?
• Only policies purchased through the Exchange allow the consumer
or employer to claim a tax credit.
• Tax credits are estimated at time of purchase for individuals.
Consumers select how much credit they wish to apply to their
premium payments. This amount can be adjusted during the course
of the year if income or other circumstances change.
• Persons with income from 138-250% FPL may receive a Cost Share
Reduction that changes a Silver policy into and “Enhanced Silver”
policy, with cost-sharing benefits nearing those of Gold Tier
benefits. These are an excellent value.
• Purchasing through the Exchange gives an extra degree of
assurance that whatever happens with regard to one’s employment
or other sources of income in the course of a year, the possibility of
receiving help to pay for coverage is not forfeited. AKR, Inc. – 2013

41. Please Remember …
• The individual mandate is effective in 2014, even for people who should
be getting their insurance through their employer.
• Penalties for employers who are required to offer affordable insurance to
their full-time employees but do not do so will not go into effect until
2015. Never-the-less, the employees must still have such insurance or be
penalized.
• If an employer does not offer a policy, employees should check directly
with Covered California’s Exchange Marketplace to confirm eligibility to
purchase insurance directly and potentially receive a tax credit to help pay
for it.
• If you are an employer with 50 FTE employees or more, your full-time
employees will be counting on you to help them comply with the law.
AKR, Inc. – 2013

42. Recertification?
• Consumers who are eligible for the advance tax credit premium
subsidies are expected and encouraged to report changes in
income or other circumstances at least twice a year. Doing so will
help them avoid the need to repay the tax credit if its final total is
lower than the amount credited as insurance premium subsidies in
the course of the year.
• At other times of the year, if income rises or falls by 10% or so, it is
good to revisit the calculator and adjust the amount of premium
paid out-of-pocket.
• During Open Enrollment each year, consumers may make changes
to their policies and/or the amount of monthly payment they make,
based on revisions to the total premium credit subsidy.
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43. Women’s Preventive Health Services
• Preventive health services for women include specific
coverage for cancer screening exams, prenatal care,
HPV and HIV screening, contraceptives and other
gender-specific care. As of August 2012, these benefits
must be provided without deductibles or copays.
• Currently and under the ACA, no Federal payment is
allowed for abortions or abortifacients, including RU
483. Health insurers are not required to offer these
benefits, though in fact most already do as a result of
customer demand.
–“Ella” and “Plan B” are not classified as abortifacients because
they act to delay ovulation rather than prevent implantation.
As a result, they are covered under the ACA as emergency
contraceptives.
AKR, Inc. – 2013

44. Tax changes in 2013
• Increased Medicare payroll tax for high-income earners
and a new tax on their net investment income
(currently untaxed for Medicare or Social Security)
• Excise tax on medical device manufacturers and
importers
• Cap on deductions for insurance company executive
pay ($500,000 maximum deduction)
• Elimination of employer deduction for Medicare Part D
subsidy
• Medical expense 1040 income tax deduction floor
increases to 10%
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45. Administrative changes in 2013
• FSA (Flexible Spending Account) limitations
• Nationwide bundled payment pilot begins in
Medicare
• Reductions in Medicare payments for select hospital
readmissions
• Medicare physician comparison data available to the
public
• Increased Medicaid reimbursement for primary care
providers
• Expanded coverage of preventive services by
Medicaid AKR, Inc. – 2013

46. So Everyone Will Be Able to Get Insurance Who Wants It?
In the best of all possible worlds, no one in the United States would
ever be left without health insurance and the access to care it brings.
Unfortunately, this is not the best of all possible worlds.
Undocumented residents may not purchase health insurance under the
Affordable Care Act, nor are they eligible in most cases to receive
coverage through programs for low income residents (Medicaid/Medi-
Cal).
In California, this means that of a population of approximately 38
million people, 1.6 million will remain uninsured – a total of 4.2% of
our total population.
AKR, Inc. – 2013

47. Basic Definitions
Actuarial Value: a technical term that describes how much of
the cost for health care an insurer will pay and how much a plan
member will pay
Co-insurance: A percentage of the cost of health care services
paid by the consumer. The insurer pays the balance.
Co-payment: A fixed amount paid for a covered health service,
generally at time of service. This amount may vary based on the
type and location of service received.
Deductible: A fixed amount that must be paid by the consumer
for health care costs before the insurance company begins to
pay a portion of the cost.
In Network: Providers who have contracted with the insurer to
provide services at pre-established discounted prices AKR, Inc. – 2013

48. More Basic Definitions
MAGI: Modified Adjusted Gross Income – used to establish
eligibility for advance premium tax credits (premium subsidies)
Medicaid/Medi-Cal: Federally supported health care for low
income Americans
Modified Adjusted Gross Income: Adjusted Gross Income from
Form 1040 minus expenses for additional costs such as housing
payments, alimony, child support, etc.
Out of Network: Providers who do not accept the discounted
prices paid by the insurers as payment in full
Tier or Metallic Tier: A group of policies from various companies
that have roughly equivalent actuarial values – referred to as
Bronze, Silver, Gold or Platinum tiers
AKR, Inc. – 2013

49. Online Resources for the Affordable Care Act
General Information
•http://www.healthcare.gov
•http://www.healthcare.gov/law/features/index.html
•http://kff.org/health-reform/state-indicator/health-insurance-exchanges/
Timeline – This is an excellent source of information!
•http://www.healthcare.gov/law/timeline/index.html
Preventive Services – What’s covered as preventive care?
•http://www.healthcare.gov/law/features/rights/preventive-care/index.html
•http://www.healthcare.gov/news/factsheets/2010/07/preventive-services-
list.html
•http://www.hrsa.gov/womensguidelines/
AKR, Inc. – 2012

50. Online Resources for the Affordable Care Act
California-specific information
•CoveredCA.com
•http://www.healthexchange.ca.gov/Pages/Default.aspx
•http://www.healthexchange.ca.gov/Pages/HBEXVisionMissionValues.aspx
AKR, Inc. – 2013

51. This presentation has been brought to you courtesy
of Advanced Knowledge Resources in cooperation
with Pozos Insurance Services.
For more information, please contact:
Kathleen Brewer de Pozos, PhD
CA License Number: 0D49354
kathy@pozosinsuranceservices.net
831-713-6438
AKR, Inc. – 2013