November 1 Begins Open Enrollment for Health Insurance Marketplaces  

Beginning on November 1, 2017, individuals (including their families) may apply for new health insurance or switch to a different health-care plan through a Health Insurance Marketplace under the Affordable Care Act (ACA). The open enrollment period for 2018 health coverage ends on December 15, 2017.   

Individuals can use Health Insurance Marketplaces to compare health plans for benefits and price and to select a plan that fits their needs. Individuals have until December 15, 2017, to enroll in or change plans for new coverage to start January 1, 2018. For those who fail to meet the December 15 deadline, the only way to enroll in a Marketplace health plan is by qualifying for a special enrollment period, which is the 60-day period following certain life events that involve a change in  family status (for example, marriage or birth of a child) or loss of other health coverage. Job-based plans must provide a special enrollment period of 30 days. The Department of Health and Human Services (HHS) extended the open enrollment period to December 31, 2017, for victims of  Hurricanes Irma and Harvey who resided in one of the counties that the Federal Emergency Management Agency (FEMA) declared eligible for individual or public assistance.

Changes to open enrollment

New HHS regulations included changes to the open enrollment period and requirements for individuals looking to purchase health insurance through Health Insurance Marketplaces. Here is a summary of the changes, effective for 2018:

  • The open enrollment period for 2018 is cut in half and runs from November 1 through December 15, 2017. Open enrollment during prior years extended from November 1 to January 31.
  • Individuals attempting to enroll during special enrollment periods must provide verification through documentation of a qualifying event.  Previously, individuals merely had to attest to changing circumstances that made them eligible to apply during special enrollment periods.
  • Some states have elected to extend open enrollment in light of the regulation. In these states, which run their own insurance marketplaces, open enrollment begins on November 1 and extends beyond December 15 as follows: California (1/31/2018); Colorado (1/12/2018); District of Columbia (1/31/2018); Massachusetts (1/23/2018); Minnesota (1/14/2018); New York (1/31/2018); Rhode Island (12/31/2017); and Washington (1/15/2018).

Other changes to the ACA

Some of the significant changes made to the ACA by the Trump administration include the following:

  • Insurers are now permitted, but not required, to collect unpaid premiums for prior health insurance coverage before enrolling an applicant in a new health plan.  
  • Under the ACA, health plans are identified as bronze, silver, gold, and platinum based on the amount of coverage offered and the plan cost. For example, a silver plan was designed to cover at least 70% of a typical person’s medical expenses, while a gold plan would cover 80%. Plans could vary by 2%. The new regulation expands the coverage variation, such that a silver plan can cover between 66% and 72%  of an individual’s medical costs.  
  • Employers are exempt from the mandate requiring birth control coverage in health insurance plans based on the employer’s sincerely held religious beliefs or on moral convictions. Employers that do not provide coverage only need to notify their employees of their decision.
  • The President has indicated that the federal government will cease making cost-sharing reduction payments to insurers to reimburse them for discounts they give policyholders with incomes under 250% of the federal poverty level. However, attempts to extend funding by congressional action are being considered.

More changes to come?

The situation regarding health care, particularly the ACA, is very fluid and changing. Attempts to repeal and replace the ACA have failed to date. The President, via executive order, has outlined plans to allow access to association health plans, where small businesses and individuals can group together to buy plans across state lines; expand short-term limited duration health insurance not subject to ACA benefit requirements; and expand the use of health reimbursement arrangements (HRAs) by employers to provide workers with tax-free funds to pay for health-care costs, primarily deductibles and copays. Whether and how these proposals come to fruition remains to be seen.


Have You Addressed Long-Term Care Costs?

At one time or another, roughly half of the citizens living in the United States will have to obtain high levels of services and support for long-term care after the age of 65. Such support will go toward helping them to have a quality life by way of enjoying everyday activities with as much freedom as possible. This is why it is so important to think about retirement and planning for all of the health care costs associated with your golden years.

Understanding Long-Term Care

Many people wonder who would be taking care of them should something happen later on in life, as nobody wants to be a burden. What long-term care involves is supervision or assistance that you might need whenever you are not able to take on some of the more everyday activities involved in daily living. Such activities may include, but are not limited to:

  • Eating
  • Cooking
  • Bathing
  • Continence
  • Toileting
  • Dressing
  • Getting in and out of bed

For most patients, the need for any assistance or long-term care could result from:

  • Advanced aging
  • Accidents
  • Stroke
  • Illness
  • Other chronic conditions

Providing services for long-term care can be expensive, exhausting and time-consuming, so you need to think about protecting your family and gathering all of the information that you can in advance. If you are worried about the costs associated with long-term care, you have options available to you in the form of long-term care insurance.

Different Types Of Long-Term Care

There are some types of care available, ranging from in-home services to constant care at a dedicated facility. Such care refers to whatever services you may need because of cognitive impairments and any other factors. Inside your home, companions or personal care assistants can be there to help with cooking, cleaning, running errands, self-care and even to sit down with you to watch a program on television or play a game. There are also home health aids that offer more involved personal care like dressing or bathing, while nurses will be available to help with medications, support IVs, and complex health conditions.

Paying For Long-Term Care

While you are going through retirement planning, you may want to look at the various health care costs that may come your way. There are different funding options that you can choose from, and it may be wise prepare in advance so that you are never forced into a decision that may be hasty, or end up with limited choices.

  1. Private/Family Support – You could look to loved ones or family to offer long-term care. However, you need to think about the various financial, physical and geographic obstacles that will be put in front of you and your family.
  2. Self-Funding – Even if you have decades of savings, paying for such long-term care can be quite a hit to your finances. You also run the risk of not being able to save quite enough money to fully cover the expenses that will come about.
  3. Public Programs – Medicare is available to help you pay for some of the expenses that you may come across. Many people believe that this will cover all of their needs for the long haul, yet Medicare is not going to pay for all of the services involved with chronic conditions that may need ongoing care.
  4. Long-Term Care Insurance – These insurance programs will give you options to have a voice regarding the care that you receive. When you can plan far enough in advance, these insurance programs can be a nice way to give you peace of mind and flexibility.

While it may not seem as though you have to address health care costs while planning for retirement, doing so may help to take the burden off of you in the future.


Maximize Deductions For Long Term Care

Long-Term Care is an important topic you should discuss with your family and Financial Advisor.  It covers all long term care costs including those not covered by health insurance or Medicare. Individuals who are unable to achieve daily activities such as dressing, eating, toileting and transferring, the insurance covers them. There are types of care the policies offer; traditional, hybrid, tax-qualified and non-tax qualified policies.

The Congress supported long-term care insurance benefits to be tax-free with its introduction in 1996 under the Health Insurance Portability and Accountability Act IRC Section 7702B.  However, over the years with tax deductions introduced, LTC receives a tax treatment along with other medical expenses. Long term care has benefits that help people with daily activities or helps those with cognitive impairment. Most policies are characterized by an elimination period for deductions.

For the long-term care insurance to undergo a reduction, it must be tax-qualified covered. However, Non-tax qualified care can be eligible if the taxpayer cannot perform two or more daily activities. Other activities such as premiums paid for tax-qualified LTCI are deductible if the premiums are payable by the taxpayer, for the spouse or any tax dependent.

Both long-term insurance and other medical expenses can be deductible together. However, the rule for medical expenses applies to claim this deduction. For individual purchase, the expenses are itemizable, and any portion exceeding 10% of Adjusted Gross Income (AGI) is deductible. Some LTCI expenses count as a medical expense whereby a specific maximum annual dollar amount indexed for inflation to which premiums are deducted based on age limitations. Its planning is purchasing via a shared care policy where two people share benefits. Most companies refer to them as “couples” even if they are not spouses. A tax deduction increases when there is an age difference between the “couples” even after retirement. Tax break rules of long term care are different when premiums are payable through a business. The employer pays the premiums, and the employee amount is deductible as a business expense. The employer’s contribution is left out of the employee’s AGI. Age limits are not a base for deductions. Purchasing LTCI as a self-employed individual, the deductions include the eligible premiums paid for the dependents and the spouse. To take this deduction, you are not subjected to attain 10% of AGI rule because the self-employed health insurance deduction is a significant line deduction and not an itemized deduction.

The deeper we go into planning for long-term care, the more complicated it could get.  It may be wise for you to get your questions answered by financial professional planning for long-term care with clients, daily.  We are here to assist you.