1. Health Coverage Tax Credit (HCTC) Overview for Trade Act Partners
February 23, 2010

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7. Featured Speakers Presenters Moderator
Lynn Reno, HCTC Business Operations Lead, Internal Revenue Service
Crystal Antiri, Workforce Development Specialist, Division of Worker Dislocation and Special Response, Office of National Response, US DOL Employment and Training Administration
Moderator
Chris Meservy, Trade Adjustment Assistance, US DOL Employment and Training Administration

8. What’s New with the HCTC
Agenda
HCTC Background
How the HCTC Works
What’s New with the HCTC
Support for You
Contact Us
Questions

9. Greater Need and Ability for HCTC to
HCTC Background
Congress created the HCTC Program as part of the 2002 Trade Adjustment Assistance Reform Act. It was established to help cover the cost of health care for:
Workers who lose their jobs due to foreign trade
Retirees who experience a pension bankruptcy
Economic
Situation
2002
Today
2002
2003
Annual 65% HCTC Created & Administered
Monthly HCTC Registration & Administration
Continued Operational Improvements
Rising
Cost of
Health Care
Expanded
Legislation
Greater Need and Ability for HCTC to
Serve
Today’s environment requires a stronger partnership and increased coordination between the HCTC Program and its stakeholders.

10. How the HCTC Works
The HCTC is available to individuals and their qualified family members who: 1
Meet Initial Requirements:
Trade-Affected : Trade Adjustment Assistance (TAA), Alternative TAA (ATAA) or Reemployment TAA (RTAA) program recipients
Pension Benefit Guaranty Corporation (PBGC) Recipient 2
Meet Other General Guidelines:
Not enrolled in Medicare
Not claimed as a dependent on another person’s Federal tax return 3
Are enrolled in a Qualified Health Plan:
COBRA
State-Qualified Health Plans
Spousal Coverage
Non-group / Individual Health Plan

11. How the HCTC Works
State and local partners play an important part in communicating information to dislocated workers.
ICON
TAA
Individual files for trade benefits
State transmits eligibility records
A petition is filed
A petition is filed
HCTC sends Program Kit to individual
Individual receives Program Kit
Once an individual is deemed eligible for a TAA, ATAA or RTAA benefit by the state, the state transmits an eligibility record to the HCTC through ICON. Only then will an individual receive information from the HCTC.

12. How the HCTC Works
The Monthly program allows participants to receive monthly assistance in paying health care premiums.
Repeating Monthly
Process
IRS receives record of eligibility & sends program kit
Individual enrolls in Monthly program
IRS invoices enrolled individual for 20% of qualified health premium
Enrolled individual submits payment to IRS
IRS adds 80% contribution and sends 100% payment to health plan

13. How the HCTC Works
The Yearly HCTC allows eligible individuals to receive the tax credit upon filing their federal tax return.
Annual Filing Process
IRS receives record of eligibility & sends program kit
Individual pays 100% of premium cost directly to qualified health plan
Individual submits Form 8885 with Federal tax return and required documents
IRS accepts tax return
IRS issues tax credit as refund or credit on taxes owed
HCTC Verifies Eligibility

14. What’s New with HCTC
The American Recovery and Reinvestment Act (ARRA)* changed the HCTC:
Greater Portion of Health Coverage Cost Paid
Reimbursement for Payments Made During Enrollment
Extended Coverage for Qualified Family Members
COBRA Benefits Extended
COBRA Premium Reduction Program
*The legislation that changed the HCTC expires on December 31, 2010.

15. What’s New with HCTC
As a result of legislation changes, the HCTC now pays a greater portion of health coverage costs.
The tax credit has increased from 65% to 80% of qualified health insurance premiums for all current and new HCTC participants, regardless of Trade Adjustment Assistance (TAA) petition date.
Began: May 2009
*The legislation that changed the HCTC expires on December 31, 2010.

16. What’s New with HCTC
Participants can receive a credit for premiums paid during enrollment.
Participants who made payments for qualified health insurance in 2009 while enrolling in the monthly program can receive a credit on their HCTC accounts. 
This change reimburses participants for the up-front out-of-pocket expenses for health insurance.
Example: If an individual pays 100% of his premium for one month, she may not have to make another payment for four months.
Began: August 2009
*The legislation that changed the HCTC expires on December 31, 2010.

17. What’s New with HCTC
Qualified family members may continue receiving the HCTC for up to 24 months.
Qualified family members will be able to receive the HCTC even after the primary eligible individual’s:
Enrollment in Medicare
Death
Divorce
Began: January 2010
*The legislation that changed the HCTC expires on December 31, 2010.

18. What’s New with HCTC
The length of time an HCTC-eligible individual can receive COBRA has been extended to the full duration of HCTC eligibility.
TAA, ATAA and RTAA recipients can receive COBRA as long as they continue to meet the definition of TAA-eligible individuals.
PBGC recipients can receive COBRA as a lifetime benefit. In the event of the recipient's death, his surviving spouse and dependents can receive COBRA for an additional 24 months.
Employers are responsible for extending COBRA benefits for these individuals.
*The legislation that changed the HCTC expires on December 31, 2010.

19. What’s New with HCTC
The Recovery Act established a new 65% COBRA Premium Reduction, completely separate from HCTC. In other words, an individual can choose either COBRA (with a premium reduction) or the HCTC.
Individuals who are involuntarily separated from their jobs between September 2008 and February 2010 are eligible to receive the premium reduction.
If an individual receives a 65% COBRA Premium Reduction through their former employer, they are not eligible to receive the HCTC during that same month.*
*If the individual becomes HCTC-eligible, she can opt out of the 65% COBRA Premium Reduction to receive the 80% tax credit. Keep in mind that HCTC does not apply to standalone vision or dental coverage.

20. Support for You Participate in HCTC frontline training
State and local TAA partners play an important role in supporting the HCTC
Participate in HCTC frontline training
Sign up for regular updates from the HCTC
Communicate with HCTC:
Let us know if you have questions
Let us know of large dislocation events
Reference online & printed support materials
Introduce the HCTC to the trade-affected individuals you work with
Refer eligible individuals to the HCTC Customer Contact Center for advanced support/questions

21. Support for You
The HCTC Program has developed several pieces of support material for you to reference when working with TAA clients & eligible individuals:
Audience
Role
Resources Available
DOL Regional Coordinators, Trade Act Coordinators & State Workforce Agency Representatives
Distribute relevant and up-to-date HCTC collateral to your frontline teams and trade-affected individuals.
SWAs only: Transmit eligibility records to the HCTC.
SWAs only: How to Transmit Eligibility
HCTC NEG Contact List
Rapid Response & One Stop Frontline Workers
Explain the HCTC to trade-affected individuals.
Refer advanced eligibility and registration questions to the HCTC Program.
Rapid Response Guide
Quick Reference Card
Potentially Eligible Individuals
Understand what the HCTC is, how they may be eligible and how to register for / receive the tax credit
HCTC Program Kit
TAA Information Guide
PBGC Information Guide
HCTC Brochure (call or to order)

22. HCTC National Emergency Grants
Funding is available for states to “fill the gap” while eligible individuals enroll in the federal HCTC Program.
Funding is authorized for infrastructure, bridge, and gap-filler activities
Bridge and gap-filler payments to participants cover 80% of qualifying health coverage costs
ETA will release additional guidance on HCTC National Emergency Grants in the near future

23. Contact Us The HCTC Program is here to help you.
Contact us with questions or to order brochures
Customer Contact Center:
HCTC ( )
(TDD/TTY)
Visit our website to download materials
The Information for our Partners page contains more support information for you.

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28. THANKS!