This dcument is intended t prvide NCAA member institutins with an infrmatinal guide regarding the ptential implicatins f the Patient Prtectin and Affrdable Care Act f 2010 (PPACA) when fully implemented in 2014. This guide is fcused n the implicatins as they pertain specifically t student-athletes, which is an area that has nt been addressed in the vlume f infrmatin available thrugh the gvernment, industry assciatins, insurers, and ther resurces. At this time, there may be mre questins than answers when it cmes t institutins determining the best way t manage athletic injury csts pst-2014, but this guide is intended t prvide a first step in beginning a dialgue at yur institutin. The NCAA recmmends that all member institutins cnsult with risk management/insurance and legal advisrs with respect t any decisins made based n the implementatin f PPACA. This guide is intended fr infrmatinal purpses nly and des nt represent risk management/insurance r legal advice.
CONTENTS UNDERSTANDING PPACA The Basics f PPACA Individual Respnsibilities and Penalties Benefit Requirements Implicatins f PPACA Relative t Student Athletes NCAA Insurance Legislatin Student Health Plans Funding Out f Pcket Csts f Athletic Injuries Institutin Level Discussin/Decisins Resurces
UNDERSTANDING PPACA THE BASICS OF PPACA What is PPACA intended t d? One f the main purpses f PPACA is t reduce the number f Americans withut health cverage. This is being dne by: Requiring mst Americans t have sme type f health insurance r pay a penalty Making it easier fr individuals t btain cverage by: Creating insurance exchanges Incenting emplyers t prvide cverage t all full time emplyees Remving barriers fr thse wh have medical prblems When des PPACA begin? Parts f the law are already in effect, and parts will take effect in 2013. But the main parts f law take effect January 1, 2014. What happens in January 2014? Three main things: The individual mandate, which requires mst peple t have sme type f medical insurance in effect, r pay a penalty, begins Emplyers wh have 50 r mre full time emplyees must prvide health cverage that meets minimum requirements, r pay a penalty. This requirement is ften called play r pay r emplyer shared respnsibility Exchanges are t be in effect in each state t make it simpler fr individuals and small emplyers t purchase cverage What is an exchange? An exchange is an entity set up in each state t make it simpler fr peple t cmpare health insurance ptins. Exchanges d nt prvide insurance, but they will versee the ptins available and prvide resurces t help peple chse. Similar t hw Expedia r Orbitz prvide infrmatin n travel ptins, exchanges will prvide a way fr peple t cmpare cst and cverage available frm different insurers.
INDIVIDUAL RESPONSIBILITIES AND PENALTIES What is the Individual Mandate? The individual mandate requires individuals t btain health insurance with minimum essential cverage r pay a penalty. Minimum essential cverage is available thrugh an emplyer plan, the traditinal insurance market, r an insurance exchange. Student health plans are part f the traditinal insurance market. Minimum essential cverage = a cmprehensive set f services including: First dllar preventive care The plan pays at least 60% f the eligible expenses cvered by the plan Maximum ut f pcket limits n greater than the Health Savings Accunt (HSA) limits which are $6,250/single and $12,500/family fr 2013 Tax credits are available t individuals and families making less than 400 percent f the federal pverty level (Currently $44,680 fr an individual and $92,000 fr a family f fur) What services must be included in a plan prviding essential health benefits? Essential health benefits must include services in each f these 10 categries: Ambulatry (i.e. utpatient) patient services Emergency Services Hspitalizatin Maternity and newbrn care Mental health and substance use disrder services, including behaviral health treatment Prescriptin drugs Rehabilitative and habilitative services and devices (e.g., speech, physical and ccupatinal therapy, fr bth thse wh had mastered the skill and lst it due t illness r injury, r fr thse wh have nt yet mastered the skill) Labratry services Preventive and wellness services and chrnic disease management Pediatric services, including ral (dental) and visin care
INDIVIDUAL RESPONSIBILITIES AND PENALTIES (cntinued) What is the Individual Mandate Penalty? The penalty is the greater f a flat dllar amunt r a percentage f husehld incme. 1% f incme r $95 fr 2014, 2% f incme r $325 fr 2015, and 2.5% f incme r $695 fr 2016 (adjusted annually thereafter) Hw des the Individual Mandate apply t internatinal students? The individual mandate applies t U.S. citizens, natinals, and an alien lawfully present in the United States. Frm this definitin, it wuld appear that internatinal students must buy insurance that prvides minimum essential cverage. In sme instances, a shrt term, limited duratin plicy may satisfy the requirement, i.e. freign students studying fr nly ne semester in the United States
BENEFIT REQUIREMENTS Hw are benefits impacted beginning in 2014? Three ntable pints: Lifetime limits n essential benefits are prhibited Pre existing cnditin limitatins are prhibited fr all participants The law requires health insurance t be guaranteed issue which means a persn cannt be denied cverage r charged mre because f a health cnditin (r injury) he r she already has. Dependent children must be eligible fr medical cverage until age 26 Plan may nt make cverage cnditinal n any factr ther than the child s relatinship t the emplyee. Fr example, a plan cannt say a child must live with the parent r must be a full time student in rder t have cverage. Parents are nt frced t carry their dependent children t age 26. It is vluntary fr the parent. Are student health plans affected by PPACA? Yes, the Department f Health and Human Services (HHS) issued a final rule n student health plans and their requirements under PPACA. By January 1, 2014, the applicable requirements listed abve will apply t student health plans.
IMPLICATIONS OF PPACA RELATIVE TO STUDENT ATHLETES NCAA INSURANCE LEGISLATION What des current legislatin require relative t insurance fr athletic Injuries? Member institutins are required t certify all student athletes have insurance fr athletically related injuries Insurance must have limits equaling the NCAA Catastrphic Prgram deductible, at a minimum. The current deductible is $90,000, a level that is scheduled t remain until at least August 1, 2015. Institutins are nt required t prvide the cverage. Cverage can be prvided by: The institutin A parent/guardian Persnal plicy held by the student athlete Insurance cverage must be in place befre a student athlete can practice r cmpete Vilatins d nt affect student athlete eligibility but are cnsidered institutinal vilatins Legislative Reference: Divisin I: 3.2.4.8 Divisin II: 3.2.4.9 Divisin III: 3.2.4.8 What des current legislatin say relative t health insurance fr student athletes? Divisins I and II Legislatin in bth divisins permits an institutin t pay medical expenses fr a student athlete. This culd be in the frm f direct payment f bills r in the frm f paying fr health insurance fr the student athlete. Legislative Reference: 16.4 Divisin III It is nt permissible in DIII fr institutins t pay fr nnathletically related medical bills r health insurance fr student athletes. Divisin III is currently cnsidering changes in this legislatin in light f changes created by PPACA pst 2014. While member institutins are nt permitted t pay nn athletically related medical bills, they are permitted t finance cverage fr medical expenses that are incidental t a studentathlete s participatin in intercllegiate athletics. Legislative Reference: 16.4 and May 28, 2008 Educatinal Clumn
STUDENT HEALTH PLANS Will institutins drp their student health plans as result f health care refrm? The answer t this questin is unknwn, but the NCAA has been made aware f certain instances in which institutins discntinued institutin spnsred student health plans in 2012. Institutins shuld begin using the PPACA criteria in their external vendr bid requests fr insurance. Will premiums g up in institutin spnsred student health plans? The student health plans likely t see premium increases frm PPACA cmpliance are thse plicies that currently leave students with significant financial expsure in the event f illness r accident. Fr example, a student health plan that previusly prvided a $50,000 annual maximum will nw have t prvide an unlimited benefit, which will likely cause an increase in premium. Premiums will als be influenced by an institutin s claims histry and therefre the new criteria shuld be cnsidered in the plan ging frward. Will student health plans be allwed t exclude r limit cverage fr expenses related t athletic injuries? PPACA legislatin des nt address this questin. The NCAA has apprached several industry experts and they all have ffered differing pinins n this questin. Therefre, if yur institutin ffers a student health plan, this questin is best addressed specifically by yur institutin s student health plan insurer. Hw d answers t the questins abve impact student athletes and NCAA institutins? The answers t the abve questins are material t the extent student health plans represent an avenue fr student athletes t secure health insurance cverage. Whether this avenue is available and affrdable and whether such cverage pays fr expenses arising frm athletic injuries culd be a factr in hw many student athletes have insurance fr athletic injuries. This in turn directly impacts the ptential ut f pcket csts that many institutins seek t insure thrugh excess accident medical plans (ften referred t as Cllege Basic Accident plans, Secndary Medical plans, and Intercllegiate Sprts Accident plans). The impact f PPACA n Cllege Basic Accident Plans is unknwn and dependent n several ther factrs mentined in this dcument. Therefre, the number f student athletes with primary health insurance cvering athletic injuries may increase, decrease r remain abut the same. Hwever, many utf pcket csts will cntinue t be eligible n Cllege Basic Accident Plans regardless f the number f student athletes with primary health insurance cvering athletic injuries.
FUNDING OUT OF POCKET COSTS OF ATHLETIC INJURIES Hw will PPACA affect my institutin? The answer t this questin depends n a large number f variables. If yur institutin 1) currently requires all student athletes t have ther insurance t cver the cst f athletic injuries and 2) des nt cver any ut f pcket expenses, the legislatin shuld nt have a material impact. Fr all ther institutins, the legislatin will create a new landscape that may impact hw yu currently manage this aspect f yur athletic prgram. Can we assume that pst 2014 all student athletes will autmatically have health insurance that cvers athletic injuries? N, based n the fact that individuals are required t secure their wn health cverage r pay a penalty, it is pssible pst 2014 that sme student athletes will nt have secured their wn health cverage. It is als pssible, depending n the utcme f currently unanswered questins regarding allwable exclusins in plans that meet the essential health benefits standard, that sme student athletes culd purchase health insurance with limitatins r exclusins fr athletic injuries. Assuming student athletes have health insurance plicies that cver athletic injuries, hw will ut f pcket csts related t athletic injuries be impacted pst 2014? Many ut f pcket csts will remain even if every student athlete has his r her wn health insurance. Examples include the fllwing: Deductibles, C insurance, and C payments Under PPACA: Fr small grup r exchange based plans that prvide essential benefits, cverage cannt have an individual deductible greater than $2,000 r a family deductible greater than $4,000 (this is nt necessarily true fr certain emplyer based plans where the requirement is t pay at least 60% f the eligible expenses cvered by the plan). The annual ut f pcket maximum cannt be mre than the limits fr health savings accunt (HSA) cmpatible high deductible health plans. Fr 2014 thse amunts are $6,645 fr an individual and $13,290 fr family cverage.
FUNDING OUT OF POCKET COSTS OF ATHLETIC INJURIES (cntinued) Out f Netwrk Services Insurance plans under PPACA can cntinue t differentiate benefit levels between in netwrk and ut f netwrk prviders. Depending n the plicy, an individual may nt be cvered at all r may be required t pay a higher prtin f the ttal csts when care is prvided ut f netwrk (which is ften the case when studentathletes receive care during the schl year while away frm hme). The ut f pcket maximums listed abve d nt apply t balance billed charges frm ut f netwrk prviders r services that are nt cvered by the plan. Therefre, ut f netwrk services culd cntinue t present significant ut f pcket csts even fr thse student athletes with qualifying essential health cverage. Will the NCAA cntinue t prvide Catastrphic Medical Insurance Cverage fr all student athletes pst 2014? Yes. The NCAA has bund cverage thrugh August 1, 2015, with the caveat that terms culd be re negtiated based n the knwn r prjected impact f PPACA nce answers are available fr many f the currently unanswered questins.
INSTITUTION LEVEL DISCUSSION/DECISIONS Institutins will need t decide if PPACA affects their apprach t managing csts related t athletic injuries. Things t think abut include the fllwing: Wh at the institutin shuld be invlved in this dialgue? Cnsider engaging the fllwing: Thse invlved with the institutin s Basic Accident plan (e.g. athletic directr, athletic trainer, insurance crdinatr, risk manager, finance fficer, insurance advisr/representative) Thse invlved with the institutin s student health plan Anyne evaluating PPACA and its impact n the institutin (e.g. human resurces directr, legal cunsel). If we currently purchase Basic Accident cverage, why d we purchase it? Ptential factrs include: We have a significant number f athletes withut primary health insurance. Our student health plan significantly limits r excludes cverage fr athletic injury expenses. Student athletes receive treatment that is ut f netwrk fr their health insurance, which expses them t ptentially significant ut f pcket expense. We want t minimize r eliminate student athlete financial respnsibility fr athletic injury medical bills. We cnsidered requiring student athletes t have their wn insurance instead f purchasing Basic Accident cverage, but we decided it was nt feasible due t limited surces f health insurance. D we think thse reasns will still apply pst 2014? Sme f the factrs abve, as well as ther factrs yu identify, may be impacted by PPACA s implementatin. While the true impact f PPACA is difficult t predict, this is a gd time t begin discussing the tpic.
INSTITUTION LEVEL DISCUSSION/DECISIONS (cntinued).. If my institutin currently spnsrs a student health plan, will it cntinue t d s pst 2014? If yes, will that plan include limitatins relative t cverage fr athletic injuries? Questins remain as t hw student health plans will be impacted by PPACA and hw thse plans will apprach cverage fr athletic injuries pst 2014. Answers t these questins are imprtant because availability f health insurance that cvers athletic injuries impacts ut f pcket csts faced by student athletes. Rather than limit the discussin t thse invlved with Basic Accident cverage, institutins shuld engage ther individuals n campus wh have infrmatin n PPACA s impact n the institutin. This will prvide a glbal perspective as well as access t answers as they becme available. If we dn t have ne nw, shuld we implement an ther cverage requirement pst 2014 since student athletes shuld have better access t health cverage at that time? Sme institutins have implemented an ther cverage requirement t cntrl Basic Accident claims csts. Others require student athletes t have their wn insurance fr athletic injuries and d nt purchase Basic Accident cverage. The availability f individual health insurance plans in the institutin s gegraphic area may have influenced this decisin. PPACA creates a new set f circumstances regarding availability f individual health insurance plans and therefre creates a reasn fr institutins t revisit this tpic. Shuld we expect material changes t ur Basic Accident renewal premium fr the 8/1/2013 renewal? Mst Basic Accident plicy premiums are determined by an institutin s individual lss experience. If yu make any material changes t yur institutin s practices that culd impact future lsses, it is imprtant t bring these t the attentin f yur insurance advisr/representative fr cnsideratin. Since the impact f PPACA n future lss experience is unknwn t bth insurers and institutins, it is nt pssible t knw hw r whether institutins upcming insurance renewals will be impacted.
INSTITUTION LEVEL DISCUSSION/DECISIONS (cntinued).. If we think a larger percentage (r all) f ur student athletes will have health insurance pst 2014, shuld we cnsider an aggregate deductible r selfinsured plan? Aggregate deductible and self insured plans reduce certain administrative csts assciated with buying insurance but add an element f uncertainty as t ultimate cst. PPACA creates a new set f circumstances regarding ptential cst f athletic injury claims and therefre creates a reasn t revisit r cnsider alternative financing methds. Keep in mind, hwever, that the ultimate impact f PPACA n the institutin s future lsses remains unknwn and analysis f ptins will require use f histric lsses which may r may nt be indicative f future lsses. Shuld ur institutin establish a resurce t help uninsured student athletes wrk thrugh the exchange, investigate available tax credits, etc.? This questin is highly individualized based n the institutin s apprach t wrking with student athletes n insurance related matters. PPACA will create a new landscape relative t health insurance, and therefre, it is an ideal time t discuss what rle the institutin will play in cmmunicating with student athletes and their families n the tpic. If an institutin wrks with student athletes in identifying r evaluating insurance ptins, the csts/benefits f an accident nly plicy versus a health insurance plan shuld be cnsidered when determining what best meets the student athlete s needs. What are the effects n ur internatinal student athletes? While internatinal student athletes are nt specifically addressed in PPACA, it des state that the individual mandate applies t U.S. citizens, natinals, and an alien lawfully present in the United States. Frm this definitin, it wuld appear that internatinal students must buy insurance that prvides minimum essential cverage. It will be imprtant t determine if an internatinal student athlete has cverage that will meet the requirements f PPACA and is accepted in the United States. Fr internatinal student athletes that d nt have cverage that meets the requirements f PPACA, each institutin will have t determine hw invlved they will be in assisting the student athlete in btaining cverage and wh will pay the csts.
INSTITUTION LEVEL DISCUSSION/DECISIONS (cntinued) If an institutin wrks with student athletes in identifying r evaluating insurance ptins, the csts/benefits f an accident nly plicy versus a health insurance plan shuld be cnsidered when determining what best meets the student athlete s needs. We believe insurance exchanges will be a resurce fr health cverage fr internatinal student athletes. Hwever, exchanges will wrk differently in every state s institutins shuld research this questin with their state s exchange. Institutins shuld wrk with internatinal student athletes prir t their arrival n campus t determine what cverage they have, what they will need t meet the requirements f PPACA and ensure the student athlete and their family understand wh will be respnsible fr the cst.
RESOURCES Federal gvernment website managed by the U.S. Department f Health & Human Services www.healthcare.gv. Kaiser Fundatin website prviding infrmatin n health refrm http://healthrefrm.kff.rg Department f Health and Human Services Final Rule regarding Student Health Insurance Cverage: http://www.regulatins.gv/#!dcumentdetail;d=cms 2011 0016 0108 State actin tward creating health insurance exchanges http://statehealthfacts.kff.rg/cmparemaptable.jsp?ind=962&cat=17 NCAA Student Athlete Insurance prgrams, requirements, and materials http://www.ncaa.rg/insurance