Stimulus 2.0: Unpacking the Consolidated Appropriations Act 2021
The “Consolidated Appropriations Act, 2021” was signed into law in December of 2020, preventing the federal government from another shut-down. Although the 5,593-page law is the longest ever passed by Congress, two portions of the Act will affect many of our clients here at Brown & Crouppen– the second round of COVID-19 stimulus payments and sweeping changes to medical billing.
ROUND 2 OF COVID-19 STIMULUS
Individual stimulus payments amounts are based on the adjusted gross income amount on your 2019 tax return. Most adults will get $600, plus $600 for every dependent child under the age of 17. So, for example, a married couple with one 15-year-old child would receive $1800.
The default AGI limits are:
- $75K or less for single adults
- $150K or less for married couples
- $112.5K for head of household.
- The Act adds an extra $300 a week in unemployment benefits through March 14, 2021.
- Self-employed workers, gig workers, and independent contractors may also be eligible for UI.
Direct deposit or snail mail. Taxpayers who elected to receive any refund via direct deposit will get their stimulus deposited into the bank account the IRS has on file. Otherwise, the stimulus payments will be mailed to you.
Who will not receive a check?
- Wealthier people. Payments decrease by $5 for every $100 in AGI over the default amounts, eventually zeroing out. You’ll receive nothing if your AGI is:
- $87,000 or more for single adults
- $174,000 or more for married couples
- $124,500 or more for head of household.
- Declared dependents age 17 or older. This includes older teens, college students, and dependent adults.
- People without a Social Security Number. The IRS won’t send a check to anybody without a Social Security Number (including dependent children). However, there are a few exceptions to this:
- An adopted child may use an adoption taxpayer identification number (ATIN) instead of a Social Security number.
- Married members of the U.S. armed forces only need to have one spouse with a Social Security Number.
- For married couples, if one spouse lacks a Social Security Number but the other spouse has a valid Social Security Number, the family can still receive a second stimulus check.
- This benefit was not available during the first round of stimulus, but Congress has made it retroactive. If your family was denied a first-round payment because nobody had a valid Social Security Number you or your spouse has since obtained one, you can claim the first-round payment as a recovery rebate credit on your 2020 tax return.
NO MORE SURPRISE MEDICAL BILLING
Surprise billing (a/k/a “balance billing”) happens when an out-of-network provider is unexpectedly involved in a patient’s care, and then charges the patient significantly more than they would have to pay under their insurance policy.
As personal injury lawyers, we see surprise billing every single day. Typical scenarios that our personal injury clients have encountered include:
- Emergency treatment after an accident, where a patient often lacks the ability to request, much less demand, in-network care.
- Non-emergency treatment at an in-network facility, where insured patients are unknowingly treated by an out-of-network physician or laboratory. For example, a patient takes the time and trouble to schedule a needed surgery within their insurance network. However, while they are under anesthesia, a visiting, out-of-network physician assists the surgeon. The visiting surgeon then balance bills the patient at a rate significantly higher than they would have paid through their insurance.
- Air ambulances, which are rarely covered by insurance and cost tens of thousands of dollars per flight.
Under the new law, patients will only be required to pay their in-network deductible and copayment amounts as dictated by their insurance plan. Out-of-network providers will not be allowed to hold patients responsible for the difference. Instead, those providers will have to work out acceptable payments with insurers.
Similarly, air ambulances will no longer be able to balance bill. (This protection does not extend to ground transportation ambulances.)
What if you want an out-of-network provider?
Patients are far more likely to switch insurance plans than a trusted provider. What happens if a patient has a favorite (or a recommended) doctor that is out-of-network?
In non-emergency situations, providers can still balance-bill their patients. In order to do so, however, the provider must:
- Provide a cost estimate, and
- Get the patient’s consent at least 72 hours before treatment (with some exceptions for shorter-turnaround times in certain circumstances.
This exception to out-of-network service only applies to non-emergency situations. It also bars certain types of “ancillary service” providers from the practice, including anesthesiologists, radiologists, and laboratories.
What if you are uninsured?
The secretary of the Department of Health and Human Services has until mid-2021 to create regulations for a provider-patient bill dispute resolution process.
More pricing transparency.
The Act also removes gag clauses on price and quality disclosures, which should help consumers become more informed about medical costs.
When does the new law go into effect?
Right now, the law is scheduled to go into effect in 2022.