Employer Shared Responsibility:

What does shared responsibility mean? Under the Patient Protection and Affordable Care Act, shared responsibility means that the cost of insurance coverage is the responsibility of all individuals, employers, and government. It is saying that individuals have the responsibility of acquiring health insurance coverage, and employers are responsible for providing insurance coverage. The government will make insurance coverage accessible and affordable to Americans by supplying tax credits for those who need it. Shared responsibility is the effort of all parties to make a contribution to the new health reform bill so it will work successfully for everyone involved (House.gov, 2013). Everyone is responsible for complying with the rules and regulation implemented under the Patient Protection and Affordable Care Act or they could face penalty.

What are the penalties for non-compliance? Under the Patient Protection and Affordable Care Act American individuals and employers must comply with the new law or they both can face penalties. By March 31^st, 2014, most American individuals will be required to have an active health insurance plan or they could be fined up to 1 % of their annual income or be charged a $95.00 fee. For non-compliance of the law, large companies with 50 or more employees could face penalties beginning in January of 2014, and in which they would encounter the fines by the start of January 2015 under the Patient Protection and Affordable Care Act. For large employers, the health insurance offered must meet the minimum standards of Patient Protection and Affordable Care Act. At a minimum, employers must pay 60% of costs and employees must not pay more than 9.5% of their household income. Employers that do not comply with the standards of the new law will have to pay $2,000 for each full time employee (Workforce.com, 2013).

How are seasonal employees counted? The Patient Protection and Affordable Care Act may apply to employers that employ seasonal workers. But an employer with seasonal workers can only be held accountable as long as the employee works at least 30 hours a week, on an average up to 12 month out of the year over a pre-determined period of time and is not considered a large employer. The seasonal worker clause of the Patient Protection and Affordable Care Act only applies if an employer has fewer than 50 full-time employees. An employer can avoid being classified as a large employer if they only work the seasonal employees during the calendar year for 120 day or less, which makes it highly unlikely that an employer will face penalties for seasonal workers (KFMR.com, 2013).

Essential Health Benefits:

What are essential Health Benefits? In regards to health benefits, it’s common for people to think of the necessary advantages they receive in their health insurance plans, such as annual deductibles, co-pays, and monthly premiums. But now, under the new Patient Protection and Affordable Care Act, essential health benefits are considered the service categories that all health insurance plans are obligated to cover before they can be certified in the Health Insurance Marketplace, beginning 2014. Essential health benefits provides a safe and fair way to offer health insurance in and outside of the Health Insurance Marketplace, to individuals and small groups markets in essential health benefit package (iHealth Care Updates.com, 2013).

Instead of creating only one common essential health benefit package for every health insurance plan throughout the whole country to follow, it has been chosen to let each state come up when their own plan for defining what the essential benefits will be, specifically. It’s called a benchmark plan, in which it allows all states four options for the basis of the essential health benefits package in that state. The four options included are:

1. Any of the three largest small group plans in the state.

2. Any of the three largest state employee health plans.

3. Any of the three largest federal employee health benefits program options.

4. The largest insured commercial non-Medicaid HMO plan operating in the state.

Importantly, if a states benchmark plan does not contain the 10 categories of benefits that

are required in the Patient Protection and Affordable Care Act then that state must change the benchmark plan to include the categories that are missing (Kaiser Family Foundation.org, 2013).

What is an essential health benefits package? An essential health benefits package is a required standard minimum coverage that all health insurance plans must meet under the Patient Protection and Affordable Care Act law. A essential health benefits package supplies important health benefits, limits cost-sharing, and provides availability to the metal levels of coverage, of either bronze, silver, gold, or platinum level coverage’s. There are 10 categories of essential health benefits that are required to be in an essential health benefits package, which the following are:

• Ambulatory patient services (outpatient care with hospital admission)

• Emergency services

• Hospital

• Maternity and newborn care (before and after birth)

• Mental health and substance use disorders services, which includes behavioral health care

• Drug prescriptions

• Rehabilitative and habilitative services and devices

• Laboratory services

• Preventive and wellness services and chronic disease treatment

• Pediatric services

The main reason for this requirement is to make it easy for consumers to get quality and reliable coverage and allow them to compare the coverage’s that are offered to one another when purchasing a health insurance plan (United Health Care.com, 2013).

Are there exceptions to offering an essential health benefits package? When offering an essential health benefits package there are exceptions that must be considered. Before a health plan can be offered in the health insurance marketplace (exchanges), it first has to be qualified. One of the standards for qualification is that an essential health benefits package must be offered with associated cost sharing limits. This means health insurance plans that provide the essential health benefits package cannot enforce annual cost sharing limits that goes beyond the limits of $6,250 per year for individuals and $12,500 per year for families as associated with high deductible plans. Small group health insurance plans that provide the essential health benefits package will not be able to enforce a deductible that is greater than $2,000 for self-only coverage or $4,000 for any other coverage in 2014. The Patient Protection and Affordable Care Act allows states to include state mandated benefits in their essential health benefits package, but that state has to pay for the mandated benefits which fall outside the required 10 benefit categories. Also, the services that are provided in an essential benefits package must at least cover 60% of the actuarial value of the covered benefits. And each state is required to offer four tiers of benefits that cover at least 60%, 70%, 80%, and 90% of the actuarial value of the benefits covered, known as the metal levels of coverage’s bronze, silver, gold, or platinum levels. Health insurance plans that are not required to offer essential health benefits are self-insured small group plans, large group plans, and grandfathered plans. But in the case a health insurance plan happens to offer health benefits, they are not allowed to apply any annual or lifetime dollar limits (CMS.gov, 2013). Below is an example chart that shows which plans must provide essential benefits and limit cost sharing and deductibles, beginning January 1^st, 2014:

Beginning January 1, 2014				Must Provide Essential Health Benefits		Must Limit Cost Sharing and Deductibles
Health Plans in Exchange	Small Group			Yes		Yes
	Non-Group			Yes		Yes
Other Health Plans	New Plans	Self-insured	No		No
		Large Group	No		Yes
		Small Group	Yes		Yes
		Individual	Yes		Yes
	Grandfathered Plans	Self-insured	No		No
		Large Group	No		No
		Small Group	No		No
		Individual	No		No

(Touschner & Corlette, acscan.org, 2013).