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Issues in Health Reform

Month: January 2014

Remind me….how are people going to be insured?

Starting April 1, 2014 most Americans are going to have to have health insurance or face financial penalties. 

1.       Many will already be insured through:

a.        the public health programs (Medicare, VA, TriCare, Medicaid, Indian Health Service)

b.      Employer sponsored insurance

                                                               i.      Including adult children up to age 26 when employer offers a family plan

2.       Those who are not insured will be required to purchase health insurance IF their income falls above income guidelines requirements.  (for example, over $15,856 for a single individual, $32,499 for a family of four).  

a.       Options for those above income cutoff include purchasing:

                                                               i.      Employer sponsored insurance

                                                             ii.      A policy in the private insurance market

                                                            iii.      A policy in the Exchange (through healthcare.gov)

b.      Penalties for not complying

                                                               i.      Will be reconciled at tax time

                                                             ii.      Will increase each year. 

                                                            iii.      In 2014 it will cost per family member 1% of income or $95 whichever is MORE

1.       Fines for children are half those of adults

2.       The fine for the total family maxes out at $295

c.       To expand options and to offer comprehensive insurance coverage, insurance policies are being offered in state Exchanges.  Anyone can buy a policy in their state’s Exchange.  No one can be denied health insurance coverage for a pre-existing condition nor can they be charged a higher premium because they are sick.

d.      The Exchanges in all states are open for business.  For some, the website version is working better than in others.  In most of the states that chose to coordinate their own Exchanges those sites are working well.  For the rest of the states, the federal website, healthcare.gov is working much more smoothly than when the website was originally launched Oct 1 and consumers are signing up. 

e.      Most of those who do not already have insurance and choose to purchase a policy through the Exchange will find that they are eligible for assistance for paying for health insurance premiums and even for copays for the actual care.

                                                               i.      If household income is below 400% of the Federal Poverty Level (FPL) ($94,200 for a family of four) AND they are not offered affordable and adequate health insurance at work, families are eligible for assistance to pay for premiums.  These are called tax credits.  How much assistance is given depends on income.  Families in these categories are limited to between 2-9% of that household income as the maximum amount of premium they have to pay.

1.       An adequate employer based policy will cover on average 60% of the costs of medical care in a given year.

2.       An affordable employer based policy will cost no more than 8% of an individual’s annual household income.

                                                             ii.      If household income is below 250% of the FPL ($58,875 for a family of four) families are also eligible for assistance to pay for medical care.  These are called tax subsidies.  How much assistance is given again depends on income.

3.       Those living below this income cutoff:

a.       In states that have expanded their Medicaid eligibility criteria, these individuals 

                                                               i.      will be enrolled in Medicaid when they submit their application through the Exchange.  The federal government is paying 100%of these costs til 2017 when states will then be asked to share the costs by contributing 10% while the feds will pay 90% of total costs.

b.      In states that have not expanded their Medicaid eligibility criteria (including Kansas), these individuals

                                                               i.      Will not be fined for not purchasing insurance

                                                             ii.      Will still be able to private pay and depend upon safety net providers and the good graces of health care providers who provider care to those who cannot pay.

How well is ACA doing getting the uninsured insured? Better than the press tells you.

What about all of those newly insured numbers? While it take many years to evaluate all of the impacts of ACA on insurance status, and certainly on the true impact of having insurance on health status, the numbers of newly insureds are impressive. As of January 15, 2014 there are almost 11.6 million Americans who have health insurance who did not have it before ACA. Almost 2.2 million people have enrolled for new insurance policies through the Exchanges. Almost 1.6 million have been added to state Medicaid rolls. And approximately 7.8 million young adults (under age 26 ) have already been added to their parents’ employer sponsored health insurance plans because of the ACA requirement that employer sponsored family plans expand coverage. This last group is often not cited when considering the success of ACA in getting previously uninsured people insured. Most of the articles focus on how successful the Exchanges are in getting the uninsured into those private plans. They also seem to ignore the success in getting individuals into state Medicaid programs. Almost 12 million folks newly insured has to be counted as a success for ACA accomplishing one of its major goals…to get uninsured folks insured.

Health Exchange Enrollment Picked Up in December, By HAEYOUN PARK, DEREK WATKINS and WILSON ANDREWSJAN. 13, 2014, NY Times.
http://www.nytimes.com/interactive/2014/01/13/us/state-healthcare-enrollment.html?_r=0
Covering Young Adults Under the Affordable Care Act: The Importance of Outreach and Medicaid Expansion Findings from the Commonwealth Fund, Health Insurance Tracking Survey of Young Adults, 2013
Sara R. Collins, Petra W. Rasmussen, Tracy Garber, and Michelle M. Doty, August 2013.
http://www.commonwealthfund.org/~/media/Files/Publications/Issue%20Brief/2013/Aug/1701_Collins_covering_young_adults_tracking_brief_final_v4.pdf