One Thing’s For Sure — The New Health Care Act Is Complicated. This Nuts-And-Bolts Guide Should Make It A Little Easier To Understand
By Alvin Langdon
It’s the biggest story in health care and politics in a decade. The Affordable Health Care Act — widely known as “Obamacare” — is in effect now. Additional provisions of the act will take effect next year.
While discussion of the act is heated and divisive, everybody seems to agree on one thing: the new act is complicated.
As you read this guide, you’ll notice that much of the plan is based on suppositions, hypotheticals and conditionals. This thing should enable that thing to happen; if that thing happens, this other thing should happen in turn. It’s not known yet whether all these plans will work as they’re designed to. We may understand a great deal more about how this plan actually works in a year or two.
Until then, we’re faced with the reality of the plan as it will go into operation in the coming weeks. The following guide is meant to give readers some degree of introduction to the new program. Every effort has been made to make the language objective, informative and easy to understand.
What should you do right now?
Most people won’t need to do anything because they have health insurance through their employer or the government. But people who do decide to use the insurance marketplaces set up by the new health care act may find them complicated.
There are many helpers who can guide confused parties through the process. Some work for the marketplaces and some don’t.
Of particular importance is a group of helpers called “navigators.” Navigators work for the new insurance marketplaces. They can teach you about the marketplaces and help you enroll. Navigators will be available in all states.
The navigator program helps anyone who wants to get insurance through a marketplace. The goal of navigators is to help consumers understand the basics of the insurance program; how it works; and how they enroll in the marketplace. Navigators will be required to take 20 hours of training. They must be impartial and are not allowed to recommend specific plans.
Should you get help from a navigator?
Anyone can visit a marketplace and buy coverage on his own. But the process is complicated. Help from navigators could be useful.
Consider this instance. Some consumers will need help figuring out whether to take a federal subsidy (financial aid) when they pay their premiums or later, as a rebate when they file their taxes.
Another potential source of confusion about how the new plan works is family relationships. For example, a couple with children from another marriage may need help to figure out just what their eligibility for coverage is.
Navigators should be able to give consumers the information they need to resolve such issues.
Can you get help from your insurance agent rather than a navigator?
Agents and brokers can help people sort out their options in the new insurance marketplaces. The rules for agents and brokers are different in each state. They all must go through the same training as navigators.
Will navigators be able to help all those who need help?
The answer to that question is not yet clear. The work of navigators is a political issue in the continuing battle over health care reform.
At least 17 states have set up their own rules for navigators or are considering doing so. Some states are requiring navigators to be licensed or certified, and several have approved rules limiting the guidance they can give to consumers. See the story on Louisiana’s plan elsewhere in this issue for particulars about what navigators you can turn to in Louisiana.
Will you pay more or save on insurance premiums?
If you don’t get health insurance through an employer or buy insurance on your own, by next year, the health insurance marketplaces should be able to save you money if you purchase health insurance.
The new health insurance exchanges are intended to create marketplaces where individuals and small businesses will have the same bulk purchasing power as large employers. Those who participate in the marketplaces will be able to shop for coverage. They can choose from a range of public and private insurance options, picking, if they choose, the one with the best price.
It is thought that exchanges could number in the millions. Given the bargaining power of such a potentially large group, it is thought that insurers will have an incentive to be competitive on benefits and price to attract more customers. Another benefit for insurers, it is believed, is that the immense size of the marketplaces will spread financial risk among the healthy and the sick.
Will there be any regulation of the degree to which insurance companies raise their prices when the new plan goes into effect?
Under the current system, state insurance commissioners have varying degrees of authority to challenge insurance company rate increases. With the new plan, any insurance company that wants to raise its individual and small group rates by 10 percent or more must disclose the proposed increases to the public and provide a sound actuarial justification for the increases.
The U.S. Dept. of Health and Human Services (HHS) will provide $200 million in grant funds to help states develop programs that will make insurance pricing transparent to consumers and stop unreasonable premium increases.
Rate reviews will be conducted at the state level, except for cases in which the state doesn’t have sufficient resources to undertake reviews. In those cases, the HHS will conduct the review.
What assurance will health care reform provide to make sure premiums are affordable?
In 2014, tax credits will be made available to help pay for health plans purchased through the health insurance plan.
Individuals who make $43,000 or less, or a family of four making less than $88,000 annually, will receive government subsidies for insurance premiums. They may also be eligible for reduced co-payments, coinsurance and deductibles to help with the cost of coverage. There will be exemptions for financial hardship.
Will all preexisting conditions be covered?
The new law guarantees health insurance coverage to anyone who applies. Starting January 1, 2014 it will no longer be legal for insurers to turn anyone down or charge one applicant more than others for a health plan because of a medical condition.
Could you be priced out of the market?
Insurers will be able to charge more for coverage for some characteristics, such as age, a smoking habit and geography.
Old people can be charged rates as much as three times those of young people. Smokers may pay 1.5 times more for their health plan than those who don’t use tobacco.
Rates will also vary depending on where you live. Under the law, insurers will be allowed to charge more for people who live in areas where medical costs are high.
One of the biggest concerns about potential rate increases under the act is that limits on how much insurers can charge old people will cause premiums for young people to skyrocket. Some critics have argued that such increases will keep young, healthy people out of the insurance pools, and that this will cause costs to rise.
Most people buying plans through the state-based insurance markets being established will qualify for financial assistance to help pay for the cost of their coverage. Individuals earning nearly $46,000 and families of four earning up to $94,000 a year, will qualify for a tax break that should lower the cost of coverage. In some cases, actual rates may be higher. But the financial assistance plan is designed to compensate for the costs by means of the subsidies.
If you don’t buy insurance, can you just pay the penalty and sign up for insurance if you need it?
In 2014, people who choose not to buy health insurance will be charged a penalty of $95 or 1 percent of their annual income, whichever is higher. The penalty will grow over time.
It’s thought that some people may decide to pay the penalty instead of purchasing coverage, and that they may simply wait until they become sick to sign onto a health plan.
Open enrollment periods are designed to discourage people from taking this option. In most states, you’ll be able to buy insurance through your state’s new marketplace at some time between October 1, 2013 through March 31, 2014. If you don’t sign up for insurance, you’ll be locked out of the market until the following year. If you become sick during that time, you’ll be left to pay for your medical care on your own.
Does health care reform include provisions to reward good health behaviors, such as fitness, weight loss and regular preventive screenings?
Yes. One way the new law rewards people for healthy behaviors is through employer-sponsored wellness programs. Common wellness programs offered by employers will address such topics as smoking cessation, nutrition, disease and stress management.
By 2014, the law will allow employers to increase employee incentives for participating in wellness programs from the current 20-30 percent of the total premium. For employees, that can translate to reduced insurance premiums, reduced co-payments and deductibles or gift cards.
Is everything in the plan in limbo?
Because the House of Representatives has voted to repeal the Affordable Care Act, some citizens believe the health care reform law was overturned and access to free preventive care has been lost.
Lawmakers can hold up money for some aspects of the health care reform law that have yet to be implemented. However, at this time, a repeal of the entire law or even of specific consumer protections in it, such as preventive care, is considered unlikely.
Do all health plans have to provide free preventive care?
No. Insurance plans that were already in place when the health care reform became law on March 23, 2010, are considered grandfathered and won’t be required to comply with a number of provisions of the new law.
However, the expectation is that most health plans will lose their grandfathered status due to significant changes in their benefit design by 2014. These plans will be required to comply with all aspects of the new law.
Where can you find a list of all the preventive services that are covered?
Routine doctor visits, such as annual checkups, and well-baby and child visits, must now be covered by your insurer if they aren’t already. Also covered are flu shots and a number of vaccinations, including those for hepatitis A and B, human papillomavirus (HPV), measles, mumps, rubella, tetanus, and diphtheria.
Blood tests to identify diabetes, blood pressure and cancer screenings, smoking cessation treatment, screening for depression and diet counseling are also covered, with no deductible, co-payment or coinsurance required.
You can find a full list of preventative services insurers must cover under the new law on the page that concerns covered preventative services at healthcare.gov.
Where can you go to find help right now?
Start at healthcare.gov, the federal government’s web site for information about the new insurance marketplaces. You can also call the federal government’s help line, 800-318-2596, which is available 24 hours a day, seven days a week.
You can also go to localhelp.healthcare.gov, which gives you a list of groups that can help near your home. Just enter your zip code or city and state. Hospitals, clinics, religious organizations and community groups are expected to sponsor events where “assisters” in the new plan will be present to answer questions.
And, again, look over the story on Louisiana’s new health care plan elsewhere in this issue.