Between the pandemic and politics, it’s been an eventful year for health and benefits. Here’s what’s happening now.
The Employer Health Benefits Survey
KFF has released its 2020 Employer Health Benefits Survey. The average annual premiums for employer-sponsored health insurance are $7,470 for single coverage and $21,342 for family coverage in 2020, and approximately 157 million people have employer-sponsored coverage. The Employer Health Benefits Survey was fielded between January and July, however, so some of the interviews were completed before the pandemic had a major impact on employers and employee benefits.
The Pandemic’s Impact on Health Coverage
According to KFF, the U.S. unemployment rate reached 14.7% in April amid stay-at-home orders. Because many people receive their health coverage through their job, a report estimated that approximately 27 million people were at risk of losing their coverage.
TransUnion says that the pandemic’s impact has been especially noticeable for younger generations, with 33% of Generation Z and 29% of Millennials reporting that their health insurance coverage has been impacted. For comparison, only 18% of Generation X and 12% of Baby Boomers reported the same.
Healthcare Cost Projections
Healthcare Dive reports that middle-income employees are struggling to keep up with rising premiums. A Commonwealth Fund survey of employers found that the employees have been paying more for premiums and deductibles over the last decade, and the pandemic is expected to make things worse.
According to SHRM, Mercer predicts that health benefits costs will increase 3.3%% at the end of 2020, and health plan costs will increase 4.4% next year. Although these increases are not abnormally high, health benefit costs are now increasing much more rapidly than the consumer price index and wage growth, which have slowed.
Many people have also delayed care because of the pandemic, and this could lead to a surge of medical costs once people make up for missed care. Because of the pandemic, Healthcare Dive reports that employers are struggling to predict healthcare costs for 2021.
New Developments in Section 1557 Rule on LGBTQ Protections
In 2016, the Department of Health and Human Services issued a rule implementing the nondiscrimination provisions of the Affordable Care Act, known as Section 1557, to protect LGBTQ patients. In 2019, the Trump administration issued a rule that repealed or revised many of the provisions. This lead to push back from some groups, as well as a lawsuit from the Whitman-Walker Clinic, Inc., arguing that the rule changes would carve out LGBTQ people from the Affordable Care Act’s Section 1557 nondiscrimination provisions. In early September, Whitman-Walker Clinic claimed victory when a federal district court judge granted a preliminary injunction to put a stop to the new rule. You can read the Memorandum Opinion here.
Creditable Coverage Model Notice Letters
People who enroll in Medicare Part D prescription drug coverage late may face steep penalties. However, these penalties can be avoided by people who can show they have creditable coverage elsewhere. CMS says that entities that provide prescription drug coverage to people who are eligible for Medicare Part D must provide a notice letter that indicates whether the coverage counts as creditable coverage. CMS has provided model notice letters in English and Spanish.
Struggling to keep up with benefits administration while working remotely?
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*This news is for informational purposes only and should not be considered legal or operational advice.