Dear Health Insurance Industry Professional: AB 2088 is moving forward in the California Legislature. CAHU is asking you to help OPPOSE AB 2088. Also, if any of your clients that have plans affected by AB 2088, ask them for their help, as well. AB 2088 (R. Hernandez) stops insurers from selling--and employers with 50 or more employees from purchasing--a limited benefit health plan unless that plan is supplemental to primary coverage that meets the bronze level of coverage as defined by the federal Affordable Care Act (ACA). CAHU POSITION: CAHU OPPOSES AB 2088 because the bill reduces options and increase costs for employers by removing choice in coverage options. The ACA defines bronze level plans as those that have at least a 60% actuarial value and cover minimum essential health benefits. AB 2088 describes any plan having less than a 60% actuarial value medical plan as a supplemental plan that does not meet Minimum Essential Coverage (MEC) standards and therefore cannot be offered, purchased, amended or renewed. AB 2088 also mandates that insurance carriers notify all affected employers that their plans are non-compliant supplemental plans and do not meet AB 2088 proposed standards. Under the law today, if an employer has a high deductible plan that is at the 40th percentile, that grandfathered plan still meets the definition of an acceptable plan under the ACA. CAHU believes that AB 2088 unnecessarily closes off employer choice in coverage options. California should ensure that employers of 50 or more employees are allowed to continue to use their grandfathered plan to provide coverage in a manner that works for their business as a cost effective solution --regardless if it is ACA compliant coverage or not. POINTS OF OPPOSITION: • AB 2088 is an unreasonable attempt to further control what types of plans carriers may sell to employers with 50 or more employees in California. • Many grandfathered plans still qualify under the ACA as plans that are viable health insurance alternatives to the Minimum Essential Coverage. These grandfathered plans also meet the Internal Revenue Service (IRS) definition of being an acceptable plan for ACA purposes. There are many unanswered questions on how AB 2088 mandates will impact tax issues for those who have purchased those plans. • AB 2088 is an effort to eliminate grandfathered plans and will only confuse individuals and businesses that have these plans available to them. • Proponents have not provided data that insurers or employers are inappropriately offering or marketing minimum value plans as a substitute for minimum essential coverage. • The ACA allows employers to opt out of having compliant coverage and simply pay the tax penalty. AB 2088 tries to wipe out this option by unnecessarily barring certain supplemental market options for large employers. • Please take action and ask your legislator to OPPOSE AB 2088 (Roger Hernandez). Click the link below to log in and send your message: https://votervoice.net/link/target/cahu/Mzc28KQGb.aspx ________________________________________
Posted on: Fri, 09 May 2014 21:17:21 +0000
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