Health care reform: What's the impact on you?
WASHINGTON - March 30, 2010 - Now that health insurance reform is signed into law, what is the impact on real estate brokers and sales associates?
• If you buy your own individual coverage and have a policy you like, your coverage would be "grandfathered" and would be considered "qualified coverage."
If you are an employer who offers health insurance to salaried workers, you may continue to offer the plan you have. Your existing plan is "grandfathered" and you are deemed in compliance with the new employer mandate. You may continue to enroll new employees and terminate those employees who leave the firm without jeopardizing this grandfathered status.
· The law creates a uniform, national set of insurance ratings and underwriting standards. These new rules spell out the criteria that insurers can use when evaluating an application. The goal of the new standards is to create a set of rules that resemble what most folks think of as the current group policy rules.
Insurers can still charge different premiums based on factors such as age, the type of policy purchased and geographic area. Insurers can't, however, deny coverage or base premiums on an applicant's pre-existing condition, claims history or gender. The National Association of Realtors calls this "a significant change" from the current rules in almost all states.
· The law seeks to expand the individual and small business insurance markets, which are the markets through which real estate brokers and sales associates principally shop for coverage.
If the plan works as proposed, it will boost access to affordable coverage by increasing competition among insurers. It will do that, in part, by expanding the pools of those insured (with a new requirement for all individuals to have coverage), encouraging insurers to enter new markets, and allowing markets to cross state lines, among other things.
The eventual goal is to merge the individual and small group markets into one larger market. In either case, independent contractors will be able to shop for coverage in both the individual and the small-business markets, so their options increase.
· The law creates new insurance exchanges, which probably received the most media attention before passage. Once completed, the exchanges will be, in effect, the insurance marketplaces through which individuals and small employers shop for coverage. Because insurance ratings and underwriting standards are more uniform under the law, shopping for coverage through the exchanges' online services or through an insurance broker is simplified, at least in theory, because it will be easier to compare plans.
· The law requires individuals to buy health insurance and it gives businesses incentives to make health insurance available to their employees. That means practitioners will have to buy coverage if they don't already have it or face a penalty, unless they can't secure coverage at a reasonable price, defined as 10 percent of their income or another justifiable financial hardship. If they can't get an exemption and still refuse coverage, they pay a fine.
The employer mandate covers businesses with more than 50 employees. Most real estate brokerages, as small businesses with fewer than 50 employees (the sales associates, as independent contractors, don't count against the employee total), are expected to be exempt. Employers subject to the mandate that fail to comply face a penalty.
Affordability credits, to help offset costs, are available to both individuals and very small employers, including very small nonprofit associations that are employers.
More detail on the potential impact on real state practitioners and brokers is at REALTOR.org/healthreform.
Source: Realtor® Magazine Online
© 2010 Florida Realtors®
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