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Taxes and Fees
Starting in 2014, there will be three major tax/fee provisions that may impact employers (see
figure 6).
Elimination of Mini-Meds and Limited Benefit Plans
In the past, employers with large, part-time or low-wage workforces and high turnover
provided mini-med and limited benefit plans as an alternative to major medical insurance.
However, due to significant benefits design changes, such as essential health benefits, metal
levels and prohibition of annual dollar limits, these plans will be eliminated. Effective January 1,
2014 annual dollar limits on essential health benefits are not permitted in any market.
Waiting Period Limits
The ACA restricts waiting periods to a maximum of 90 days, beginning January 1, 2014.
Out-of-Pocket and Deductible Limits
Health care reform requires out-of-pocket and deductible maximums to align with the annual
HSA limits effective 2014. The deductible limit only applies to individual and small employer
insured plans, but does not apply to grandfathered plans. The out of pocket limit applies to all
non-grandfathered plans for fully insured and self-insured employers. Out-of-pocket costs or
annual cost-sharing includes deductibles, copays, coinsurance and similar charges, as well
as any other payment toward medical expenses that is considered an essential health benefit,
but does not include balance billing.
Note: The limit on out-of-pocket maximums will be the same as the out-of-pocket maximum for HSA compatible high-
deductible plans in 2014, but will be subject to inflation adjustment in 2015 and beyond. For 2014, the out-of-pocket
maximum was $6,350 for single coverage and $12,700 for family coverage. The maximum deductible limit in 2014 will
be $2,000 for single coverage and $4,000 for other tiers. These limits will also be subject to adjustment for inflation in
2015 and beyond. The out of pocket and deductible limits do not apply to grandfathered plans.
Figure 6:
Health Insurer
Tax
Patient Centered
Outcomes Research
Fee
Reinsurance Fee
Who is
impacted?
Fully Insured
(Paid by Insurers)
Fully Insured and
Self Insured
Fully Insured and
Self Insured
When?
Beginning 2014
Beginning October 2, 2011,
ends in 2019
2014-2016
How much? *Estimated premium
impacts 1.9% -2.3%
increase in 2014, rises to
2.8% -3.7%
by 2023
Annual fee on $1 per
enrollee for plan years
ending after October 1,
2012 and before October 1,
2013, then $2 per enrollee
until 2019 (indexed after
2014)
For 2014, the fee for each
plan is $63 per enrollee per
year. Premiums increase
in employer segments.
Premiums decrease in
individual market, since the
program pays reinsurance
for high risk individuals
