Health care reform: What does the Supreme Court ruling mean to Stanford employees?

Stanford health care benefits will not change significantly in response to the June 28 Supreme Court ruling on health care reform. However, the legislation did include required changes that are to be effective in 2013, and the university plans to comply with those required changes.

Now that the U.S. Supreme Court has upheld most of the provisions of the Patient Protection and Affordable Care Act, Stanford officials are working hard to ensure not only that the university complies with its provisions but that it also continues to provide employees with comprehensive health benefits options.

"The Affordable Care Act undeniably changes the landscape of health insurance coverage in America," said Les Schlaegel, associate vice president of benefits. "We at Stanford University understand the near- and long-term requirements that will be imposed by the legislation, and we are ready to comply with those rules in a timely manner."

Stanford health care benefits will not change significantly in view of the court ruling. Stanford will continue to offer its current lineup of health plans in the coming year: the Kaiser Permanente HMO (health maintenance organization) and the Blue Shield of California EPO (exclusive provider organization), PPO (preferred provider organization) and HDHP (high-deductible health plan). However, the health care reform legislation did include required changes that are to be effective in 2013. In that regard, Stanford University plans to comply with the required changes, as outlined below:

  • Health care flexible spending account (FSA) limit. The amount of pre-tax money that employees may contribute to their health care FSAs will be limited to $2,500 per year, down from $5,000.
  • W-2 reporting. Employers are required to report the value of employer-provided health care coverage on Form W-2. The amount reported must include both the portion paid by the employer and the portion paid by the employee. The value of the coverage provided will not be considered taxable income, however; reporting is required for informational purposes only.
  • Summary of benefits and coverage. Employers are required to provide a four-page summary of benefits and coverage (SBC) for all the health plans available to employees. These summaries describe the benefits provided by each health plan. Stanford employees will therefore receive an SBC that describes the benefits provided by each health plan offered by the university.
  • Women's preventive health services. Eight categories of women's health services that were recommended by the Institute of Medicine are required to be covered as free, preventive care. These are: well-woman visits; gestational diabetes screening; HPV DNA testing; sexually transmitted infection counseling; HIV screening and counseling; FDA-approved contraception methods and contraceptive counseling; breastfeeding support, supplies and counseling; and domestic violence screening and counseling.
  • Medicare tax on high-income earners. Single filers earning $200,000 or more and joint filers earning $250,000 or more will have to pay an additional 0.9 percent payroll tax. There will also be an additional 3.8 percent Medicare tax on unearned income (i.e., income from investments).

Stanford employees will receive additional information about the changes to their health care benefit offerings in open enrollment materials that will be distributed in the fall of 2012. Individuals with questions about the mandated benefits changes taking place in 2013 should call a benefits representative by dialing (877) 905-2985 and pressing option 9.

"We will continue to explore ways to support employees in making educated choices about their health care," said Schlaegel. "Rest assured that we're committed to offering comprehensive benefit programs that meet our employees' health and wellness needs."