Since President Obama signed the Patient Protection and Affordable Care Act and the Health Care Education Reconciliation Act in March, UC faculty and staff have been asking questions about how the health care reform laws will affect their UC-sponsored medical insurance. The following is from a conversation with Mark Esteban, Director of Benefits Programs, UC Human Resources, Office of the President. For more articles related to HR and Benefits, check out the May issue of "Our University" in Related Information.
We do know a few other details. For example, an employee's married child will be eligible for coverage, which is a change. But the child's spouse or domestic partner and/or children will not be eligible, which is consistent with current law. If the adult child is eligible for employer-sponsored coverage elsewhere, he/she would not be eligible for coverage under the parent's plan. Also, the adult child does not need to be a tax dependent.
It is still unclear when coverage of the adult child ends. The tax code says the child can get health care tax-free through the end of the year in which he or she turns age 26, but the health care reform law says coverage is required to last through the end of the month in which the child turns 26.
The cost of this provision for UC's plans is also unclear. Although this population is generally healthy, adding more people to the plan will increase our costs.
The elimination of lifetime limits on benefits could affect people enrolled in our Anthem Blue Cross Plans or the CIGNA Choice Fund Plan, which currently have lifetime limits. As we go through the renewal process with our carriers over the next few months, we will know the cost of eliminating the limits. It could have an impact on premium rates.
Our HMO plans (Kaiser, Health Net and WHA) don't have lifetime limits, so they should not be affected.
Other provisions of the law affect our Health Flexible Spending Account. Beginning in 2011, over-the-counter drugs will no longer be reimbursable. We're concerned that this will lead some employees to use more expensive prescription drugs, which could affect medical plan costs.
Also, the maximum contribution to a health FSA will be reduced from $5,000 per year to $2,500 per year beginning in 2013.