Your Clients and the Affordable Care Act

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Trial attorneys are talking about the Affordable Care Act (ACA) and how this new bill will affect their practices and ultimately their clients. The Affordable Care Act (ACA), House Resolution H.R. 3590, became law March 23, 2010. It applies to United States citizens, nationals, or aliens lawfully present in the United States. (ACA, Sec. 1312, (f), (3)) However, the ACA does not apply to illegal residents or incarcerated people.Essentially, the ACA protects insurance coverage for the uninsured. It eliminates lifetime limits on benefits for any participant or beneficiary. (ACA, Sec. 2711) and provides coverage for pre-existing conditions (ACA Sec. 2705). No longer can people be denied coverage for the following factors:

  1. Health status/medical condition;
  2. Claims experience;
  3. Medical history;
  4. Genetic information;
  5. Or, disability.

Insurance companies must now cover essential health benefits (ACA, Sec. 1302) to at least include the following:

  1. Ambulatory patient services – the out-care received without admittance to a hospital;
  2. Emergency services;
  3. Hospitalizations and surgeries;
  4. Maternity and newborn care;
  5. Prescription drug coverage;
  6. Laboratory services;
  7. Pediatric services;
  8. Preventive and wellness services;
  9. Rehabilitative and habilitative services;
  10. And, Mental Health & Substance Abuse Disorders (Added February 2013, by Sec. Sibelius of Dept. HHS.).

Health insurance premiums will vary depending upon the plan coverage selected. For example: Female, age 53, monthly premium $651 for PPO. Federal assistance for the payment of monthly premium is available for those who have an annual income that does not exceed 400 percent of the federal poverty level (FPL). In 2014, 400 percent of the FPL for a single person would be $46,680 and 400 percent of the FPL for a family of four would be $95,400 (

Think of the ACA insurance coverage as simply extending Medicare-type coverage to almost everyone in the United States.

What Does The ACA Mean For Your Practice?

  •  Now almost all of your present and future clients, including those catastrophically injured and disabled can get insurance coverage.
  •  It allows you to determine maximum client out of pocket costs for future treatment. Most injuries policies have maximum annual out of pocket limits.
  •  It reduces client fear about the future and how much they will need for care.
  • Most clients will be able to qualify for federal premium assistance.

Please be aware that personal injury settlements are not included in the income calculation. Income qualification for federal premium assistance uses the Modified Adjusted Growth Income (MAGI) method. Adjusted gross income increased by foreign earned income, housing cost while in foreign country, tax-exempt interest received and some Social Security benefits (26 U.S. Code Sec. 36B(d)(2) (B) Internal Revenue Code).

Medicaid coverage may still be in the best interest of those clients that are catastrophically injured requiring home health care. The ACA coverages are similar to Medicare and do not provide assistance for in home health care.

Interesting Idea

For your disabled clients who are waiting to receive Medicare, during the 24-month waiting period after approval for Social Security disability, purchase a health insurance policy through the ACA to provide them with coverage and have a structured settlement annuity pay the premium payments as well as provide coverage for the annual maximum out-of-pocket exposure peace of mind for your client.

Items To Keep On Your Radar

As the ACA continues to evolve, trial attorneys and settlement consultants should be aware of how it may impact the collateral source rule, subrogation clauses as well as lien repayment. Jay Scarola

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