Keeping America healthy…how much is too much?

Keeping America HealthyThe landscape of health insurance has drastically changed over the past few years with the implementation of the Affordable Care Act (ACA). While almost unheard of five years ago, more than a third of US employers now charge their workers a penalty if they don’t participate in wellness programs. As insurance professionals we deal in “lives” and sometimes forget that there are individuals behind those numbers with families and ailments that need to be covered.

These programs promote wellness and preventative habits and treatments to encourage employees to be healthy…but how much is too much? When does it become an issue violating these employees’ rights?

In 2014 Honeywell International asked workers to participate in voluntary screenings of their cholesterol, body-mass index and other health screenings. If employees chose not to participate they could face up to $4,000 in surcharges and lost incentives. This is nothing new in the world of the ACA, after all, the ACA promotes health and wellness for employees as a way to keep employees healthy and keeps costs low for providing insurance to employees.

It wasn’t the program that raised eyebrows; it was the cost of the penalties to the employees that chose not to participate. Under the ACA, employers can reward workers with as much as 30 percent of the cost of their health insurance benefits in return for participating in work sanctioned programs to monitor weights, cholesterol and other wellness measures.

Last week the Equal Employment Opportunity Commission issued new regulations. The rule makes is clear that wellness programs are permitted under the Americans with Disabilities Act, but they may not be used to discriminate based on disability.

Steve Wojcik, VP of public policy at the National Business Group on Health said, “The EEOC has removed the cloud of uncertainty.”

So what do you think? Are the laws clear enough? Are financial incentives enough for employees/Americans to get healthy? What does this mean for the future of healthcare in our country?

The ACA in 2015 Webinar Event with Kaya Bromley!

It's 2015, as a business owner, what do you need to know about the ACA? Kaya

Find out in our informational webinar with leading ACA expert Kaya Bromley brought to you by Jean Angelo of Strategic Insurance Solutions.

We will be discussing the topics that will effect you the most, including:

An overview of establishing whether or not you are an “ALE” (Applicable Large Employer).

What are the pay or play penalties?

  • What triggers them

  • How each will impact your company and what employers can do now it eliminate or mitigate these penalties

IRS reporting

  • What is it?

  • 1094’s and 1095’s explained

  • When is it submitted?

  • What am I keeping track of anyway?

Employers that invest their time in this webinar will walk away with a sound knowledge of the ACA rules and how it impacts their business, along with actionable items the employer can address today.

All brought to you by FreedomCare with Bob Gardner and Kaya Bromley.

Date: May 18th, 2015

Time: 12:00pm EST

Register HERE

New Marketing Materials!

New Marketing Materials AnnouncementWe have big news! Our marketing department has been working day and night and has completely revamped our marketing materials for 2015! Are you currently one of our appointed brokers? Contact your regional sales consultant to make sure you have up to date materials!

Are you interested in becoming an appointed broker with FreedomCare? Start here.


The ACA versus the Agriculture business

ACA mandates vs Ag BusinessFuel costs, weather, destructive bugs, water shortages, and so much more wreak havoc among one of the most important industries in the world, Agriculture. Unfortunately, this year also marked the beginning of another unpredictable factor that can’t be killed with a spray or kept out with a greenhouse, the employer mandate of the Affordable Care Act.

Agriculture business owners are some of the most savvy leaders operating on small profit margins with little room for error. Most do a wonderful job improving their efficiency, preventing injuries and training long term employees. Recently the California Fresh Fruit Association released the "Top 10 Issues facing the US agriculture industry today." Among the top 4, the glaring elephant in the room, the employer mandate of the Affordable Care Act. This probably isn’t a shock to most people as the ever changing law makes it difficult for any industry to keep up, however for the agriculture industry the penalties of the mandate can be devastating.

What are the main concerns?

  1. Interpreting the law. With it's ever changing guidelines and rules, most employers are struggling to be clear on what is expected of them.
  2. Gathering and completing the mandated paperwork.
  3. Providing a healthcare solution that doesn't devastate your bottom line or cut into needed wages for employees.

Each of these issues are huge concerns and many employers are choosing to ignore them and focus on other more pressing issues of their business. But choosing to ignore the employer mandate is going to end up putting you out of business. Can your profit margin survive a half a million dollar hit?

The USDA Economic Research Service noted that nearly 70% of all farms operate on a profit margin of less than 10%. The New York Times estimated businesses will need to spend an additional $1 per hour per employee just to cover the mandated insurance coverage each month.

We understand the challenges you and your clients are facing and we specialize in walking clients through the process who have never offered healthcare before. Our legal experts keep our clients up to date with the ever changing law and we guarantee our ACA compliance so you can focus on what matters most, your business.

Check out our 3 Reasons to Self-Insure your benefits plan to learn more about how self-insurance works and what separates FreedomCare from our competitors.


How to achieve a ‘penalty-free’ workplace

The New York Times recently said: After the enrollment deadline passes on Sunday, every adult without insurance will be subject to a minimum penalty of $325 when filing taxes next year. The fee will rise the following year to $695 per adult, more than seven times the $95 penalty for being uninsured in 2014.”

That story was about the individual mandate penalties, not the business penalties.

By now you probably know that large employers are facing penalties for not providing insurance, and they make the individual penalties look like a bargain. Businesses face penalties of $2000 per full-time employee, and possibly $3000 for each employee who gets an insurance subsidy on an exchange.

How to achieve a penalty-free workplaceThe Times article made it clear that the President and his team were openly pushing the fear of penalties to drive consumers to the exchanges where they can sign up for health insurance. Their goal is to have about nine million individuals enrolled in a plan. Are any of those nine million people employed by you?

If they are, then you owe a $3000 penalty if you failed to offer that person a health plan that is ‘affordable’ under the rules. You will also owe an additional $3000 for every one of your employees who takes the President’s advice and gets insured through the exchange with a subsidy.

But there’s good news. You only owe the full penalty if you fail to offer a plan for the entire year, or if you fail to offer an ‘affordable’ plan that meets the IRS’ tests for affordability.

That's not all, their are plans available that are not only affordable but offer a preventative and wellness plan and a Bronze plan at the same time. The combination creates a ‘penalty-free’ workplace allowing you and your employees peace of mind during tax season.

The preventative and wellness plan is a minimum essential coverage (MEC) plan and fulfills your employees’ requirement to have health insurance. So there’s NO penalty for your employees. But what about you, as their employer?

The offer of the Bronze plan satisfies your requirement to offer a plan. This puts you, and your employees, in the penalty-free zone. So where can you find this combination that keeps you safe?

FreedomCare offers the only guaranteed compliant program available that is low cost and easy to implement. There are thousands of employees around the country with FreedomCare cards right now, and thousands more on the way, and none of them will have their tax refund gobbled up by Uncle Sam as a penalty for not having health insurance. Not only are they penalty-free, but their employers are as well. It’s a win-win-win with FreedomCare.

Start today by making steps to create your own penalty-free workplace.


The $38K Question..

Last week we talked alternatives to traditional insurance plans like self-insuring for compliance under the Affordable Care Act. Unfortunately a large portion of employers have chosen to take a different approach…to do nothing. So you may be thinking, what are the consequences if you choose not to do anything?

For employers, the Affordable Care Act presents 2 possible penalties for not complying.

  1. The first is a $2,000 per employee penalty for not supplying a health plan offering 63 Minimum Essential Coverages. For our purposes we will call that Penalty A.
  2. The ACA also imposes a $3,000 per employee penalty if the employer supplies a plan but it does not offer coverage as generous as a Bronze Plan. We will call this one Penalty B.

To determine how much that really is, lets say your company has 200 full-time employees. If just one of those employees is not offered coverage and receives a subsidy or tax credit on the exchange, you are on the hook for Penalty A which equals $240,000! ($2,000 x (200 employees – 80 (the law allows for a deduction of 80))

The $38k Question

You could end up paying this entire amount even if you are offering insurance to the majority of your employees. On top of Penalties A and B, there is a Catch-All Penalty of $100 per employee per day for numerous kinds of violations that do not fall under Penalty A or B.

There are multiple ways to trigger this Catch All Penalty:

  • Your plan excludes people for pre-existing conditions or otherwise discriminates based on health status.
  • Your “Out of Pocket” limits are higher than allowed by the ACA.
  • You incorporate a waiting period of longer than the 90 calendar days without properly enacting and calculating an additional 30 day orientation period.
  • Your plan includes annual or lifetime limits on essential health benefits.
  • You are not properly offering dependent coverage to children up to age 26.
  • You do not properly provide a Summary of Benefits and Coverage.
  • You do not have adequate claims appeal and external review processes.

The Catch All Penalty would apply to every single affected individual as long as the violation exists. This is calculated on top of Penalties A & B. Calculated over an entire year, the Catch All Penalty would cost an employer $36,500 for one employee. Using our example above, if you have 200 employees and you are in violation for the entire year, your penalties would be too outrageous to even contemplate..over $7 Million! So what are the total amount of possible penalties and excise taxes employers could face per employee?

That is the $38k Question.

To make things worse, these penalties are excise taxes and are not tax deductible like health plan contributions would have been. Does it seem like it’s a good idea to choose not to do anything? It’s not to late to mitigate your losses, check out our previous post about Self-Insuring your benefits to begin exploring alternatives to traditional insurance and choosing not to do anything.

3 Reasons to Self-Insure your Benefits Plan

shutterstock_94589152Most brokers and employers were in denial this past year about the Affordable Care Act. With its ever-changing laws, continuous delays and lack of clear information some brokers and employers were under the impression the employer mandate would never go into effect. Well, its 2015, nothing was overturned and here we are, employers are facing thousands of dollars in potential penalties.

Most people don’t know that a large portion of the ACA is going to be funded by employers who fail to comply and end up paying penalties. Compliance is critical if you or your clients do not want to be part of the Obamacare funding machine.

Any insurance agent who represents large groups of 50 or more full-time employees knows that the ACA is going be challenging. Agents and Employers that understand the basics of the laws are more equipped to navigate the changes and are often more open minded to considering different strategies.

When considering plans like the ones FreedomCare offers, you have to start by changing the way you think about traditional health insurance plans and start exploring the world of self-insured health plans, also known as ERISA qualified plans. The Affordable Care Act brought numerous mandates on traditional insurance plans but exempts ERISA plans from a lot of the ACA provisions. Self-Insuring your benefits is not only legal; it has been around for decades. Traditionally Self-Insurance has only been able to be utilized by large employers; until now.

So why would you want to self-insure?

1. You have more control over your plan design:

Traditional insurance companies usually offer set packages for benefits. By self-insuring, an employer can tailor a plan suited for their employees.

2. You can save a lot of money:

Self-Insured plans are not traditional products, they have very different costs associated with them. For example, they don’t have to build in extra charges for profits or taxes.

3. Better cash flow:

With a traditional insurance plan, the employer pays the same premium even if their employees use less care one month than predicted. With a self-insured plan, the employer pays the actual cost of care instead of a fixed monthly premium and holds on to that extra money.

So you’ve seen that self-insuring offers several advantages over traditional insurance. But where do you begin?

Well FreedomCare allows employers greater flexibility and discretion when it comes to self-insuring their benefits. We offer the only Guaranteed Compliant program along with a wealth of benefits that are not only valuable to employees but also a value to business owners.

Take control of your benefits program, start your self-insured program today.

Employers face Thousands in Tax Penalties

2015 is here, it’s a new year and as with most new years, we have all made resolutions to get healthy, save more money and other improvements to our lives. Unfortunately, I have some bad news, the dreaded Employer Mandate of the Affordable Care Act is now enforceable and it comes with hefty fines. You or your clients will be feeling the pressure if you haven’t worked to already have your compliant benefits plan in place. The penalties start in the thousands and only go up from there. If you have 70 or more full time employees you could be facing over $6,000 a month in fines alone. The fines aren't just on you either, your employees are also facing them.

Now let’s get to the good news, the fines are enforced each month and you can still mitigate your losses by acting sooner rather than later. If you just stumbled onto our blog or if you still have questions about what really happens during an IRS audit, start here by educating yourself of what the possibilities are.

We sponsored a very informative webinar series with Kaya Bromley of Your Obamacare Advisors in 2014 that was a huge success. Your Obamacare Advisors has archived all of those webinars for you to view at your own convenience. The topics include, "The Lookback Method, want to know what happens if you get it wrong?" "Common Questions about Self-Insuring" and more. If you are an employer, these are a must see or if you have clients who could benefit from these videos, you might want to do yourself a favor and pass them along.

Are you sure your business is safe

So now that you are facing these penalties..what can you expect in 2015? Well here at FreedomCare we will keep you updated with the latest breaking information regarding the Affordable Care Act with facts and opinions brought to you by our team of legal experts, seasoned insurance professionals and more. We will bring you weekly updates along with a series of very exciting Webinars. Stay tuned.

Webinar this week!

Kaya Bromley of Your Obamacare Advisors is hosting another must see webinar this week! We can’t wait to share it with you! Here is her release.


In case you haven’t heard yet, this week the Department of Health and Human Services and the Treasury Department jointly released Notice 2014-69 tightening up the definition of Minimum Value Plans.

Many employers purchased or were planning to purchase plans that were compliant a few weeks ago, but as of November 4, 2014 will fail the clarified Minimum Value Rules.

If you are a broker or an employer who bought or was planning to buy one of these plans, you are going to want to attend this week’s webinar to learn what this Notice means to you.

If you still haven’t settled on your strategy for January 1st, you will also want to attend this week’s webinar because we will be talking about the strategies that are left.

In this webinar we will cover:

  1. How did Notice 2014-69 clarify the minimum value rules?
  2. What you need to know if you already purchased one of these plans?
  3. What strategies are still available to employers?
  4. How employers can avoid ACA Penalties and why this should be their number one goal.
  5. An introduction to FreedomCare.

Joining me this week is Matt Vick, Manager of FreedomCare, to discuss the IRS Notice and to give his insight into how employers can still guarantee their ACA compliance.

This may be the most important webinar of the year.

Register now! Space is limited!

IRS Notice 2014-69

The IRS notice we have been warning you about was released earlier this week. To get you up to speed, here are the highlights.IRS Notice Blog Post


  • Narrow Minimum Value Plans do not meet the minimum value requirements.“The Departments believe that plans that fail to provide substantial coverage for in-patient hospitalization services or for physician services (or for both) (referred to in this notice as Non-Hospital/Non-Physician Services Plans) do not provide the minimum value intended by the minimum value requirement.” (IRS Notice-2014-69)
  • Employees that were offered a Narrow Minimum Value Plan will still be eligible for subsidized healthcare on federal and state insurance exchanges triggering the $3000.00 penalty. “… in no event will an employee be required to treat a Non-Hospital/Non-Physician Services Plan as providing MV for purposes of an employee’s eligibility for a premium tax credit under Code section 36B, regardless of whether the plan is a Pre-November 4, 2014 Non-Hospital/Non-Physician Services Plan.” (IRS Notice-2014-69)
  • Employers that have offered these Narrow Minimum Value Plans have a “duty to inform” their employee of their non-compliance. “An employer that offers a Non-Hospital/Non-Physician Services Plan (including a Pre-November 4, 2014 Non-Hospital/Non-Physician Services Plan) to an employee (1) must not state or imply in any disclosure that the offer of coverage under the Non- Hospital/Non-Physician Services Plan precludes an employee from obtaining a premium tax credit, if otherwise eligible..” (IRS Notice-2014-69

Enough with the bad news, now the good news.

Here at FreedomCare, we have always guaranteed compliance, we are and have been your low cost solution to the Affordable Care Act since day one. If you have presented to your clients or have been presented  one of these Narrow Minimum Value plans it’s not too late. The transition to a compliant plan is simple and we are here to help.