How Healthcare Reform will affect nfp's - Sober up

Not-for-profits, along with all other US businesses, are in for a rude awakening when the healthcare reform legislation kicks in, as Phil Bushnell of Gallagher Benefit Services explained to the nfpFMA members today.  Phil distributed a timetable ranking the changes in order of when they will take effect, beginning in 2010. Some of the most prominent changes will be:

In 2010: Dependent coverage will be available to age 26; Coverage can no longer be rescinded for health reasons; Pre-existing condition exclusion for children under 19 years of age will end; Consumer rebates will be available; and Annual/lifetime coverage limits will end.

In 2011: Value of medical benefit must be reported by all employers (including nfp's) on their employees' W-2's; FSA reimbursement for OTC drug expenditures will end; and The CLASS program will be introduced (to reimburse medical out-of-pocket costs for early retirement employees) which is only expected to last less than the 1st month past its introduction date.

In 2012: No changes.

In 2013: FSA's and HSA's will be capped at $2,500 contribution levels; and High income individuals will begin paying more taxes to pay for costs of reform.

In 2014: Medicare tax rate will increase from its current levels of 1.45% for both employees and employers; Pre-existing exclusions will end; All citizens will be required to have insurance coverage; and All employers will be required to offer insurance coverage.