ACA explained.
2014: A new system began
A set of rules that took effect Jan. 1, 2014, which makes shopping for health insurance a completely different experience for those who buy it on their own—or were uninsured!
These are the biggies:
Guaranteed issue.
This is the most popular part of health reform: Health plans must sell coverage to everyone, regardless of pre-existing conditions, and can’t charge more based on health or gender.
Exchanges.
Every state must have an insurance exchange (Az- healthcare.gov)— an organized marketplace where individuals and small-business owners can view, compare, and purchase qualified private health plans. It’s expected that most consumers will shop on their state’s exchange online, but they can also shop by phone or through brokers.
States had the option of setting up exchanges themselves or allowing the federal government to do the job. The federal government operate exchanges in as many as half the states. About 20 states operate their own exchanges while in other states, the federal government made a joint venture/partnership with the state.
Individual mandate.
Everyone will be required to have health insurance or pay a penalty through the IRS tax service Almost any sort of legitimate coverage will satisfy the mandate: private insurance obtained on your own or through a job, Medicare, Medicaid, CHIP, Veterans Affairs, or Tricare,etc.
Penalty.
If you don’t have health insurance, you’ll have to pay a tax penalty, starting at $95 per individual, $285 per family, or 1 percent of income, whichever is greater, for 2014. (That rises to $695 per individual, $2,085 per family, or 2.5 percent of income in 2016.)
Because the vast majority of people will already have qualifying health insurance, few will confront the choice of buying a plan or paying a penalty. Moreover, you won’t have to pay it if you make too little money to file a federal tax return or would have to spend more than 8 percent of your household income on the cheapest qualifying plan, even including subsidies. Americans living abroad, and those in prisons, are exempt from the mandate and associated fines.
Individual subsidies.
Afraid you won’t be able to afford insurance?
If you buy on an exchange as an individual, you may qualify for a subsidy in the form of an advance tax credit if your household income is between 100 percent and 400 percent of the federal poverty level. (The tax system already subsidizes people who have coverage through a job by excluding the cost of their health plan from income taxes.)
For instance, a family of four with an income of 200 percent of poverty, or about $46,000 in 2012, will pay no more than $235 a month for health insurance. People with household incomes of less than 250 percent of poverty will also get subsidies to reduce their out-of-pocket costs, such as deductibles and coinsurance. You’ll learn whether you qualify for a subsidy when you shop on the exchange.
New health plans:
New Health plans are available on the new exchanges/marketplaces ( healthcare.gov in Arizona- run by the federal government), BUT they have defined Open Enrollment Periods (last one ended 3/31/2014) when you can get quotes and sign up for the new plans BUT outside of these Open Enrollment Periods you will only be able to get an On Exchange quote ( with a tax credit ) of you qualify for a Special Enrollment Period (e.g.- get married,divorced, move, start or leave a job,etc,).
A new Enrollment Period will start 11/15/2014!!
Medicaid expansion
The health care law was intended to expand the government-run health program for low-income Americans to cover up to 16 million more people with household incomes up to 133 percent of the poverty line ($14,856 for an individual and $30,657 for a family of four). That includes many at or below the poverty line who were not then eligible. Arizona expanded its Medicaid ( AHCCS ) plan to include an approx 400,000 more people. See if you qualify or your children for CHIP – you can apply any time at healthcare.gov-no enrollment periods!
Other details
Insurers must spend at least 80 percent of premiums on medical care and quality improvements for customers in their individual and small-group (under 50 employees) plans. The cut-off is 85 percent for large group plans.
The rule does not apply to self-insured plans offered by employers who pay employee health expenses on their own. The only way to know if you are self-insured is to ask your employer. You can’t tell just by looking at your insurance card.
Standard disclosure forms.
Beginning in September, 2012, all health plans have to use a standardized, consumer-friendly form to provide a uniform summary of benefits and coverage, including information on co-payments, deductibles, and out-of-pocket limits. This will make it easier for you to compare plans. Insurers will also have to calculate and disclose a patient’s typical out-of-pocket costs for two medical scenarios: having a baby and treating type 2 diabetes.
Caps on Flexible Spending Accounts (FSAs).
Starting 2013, the most you can set aside tax-free for medical expenses not covered by insurance will be $2,500, with the cap increasing by the annual inflation rate in subsequent years. Plus you can no longer use FSAs to pay for over-the-counter drugs unless you have a doctor’s prescription.
Other Reforms
More young adults with insurance.
All health plans must allow young adults to remain as dependents on their parent’s health plan until they turn 26, whether or not they live at home or can be declared as dependents on the parent’s income tax return.
Cheaper drugs for people on Medicare.
Seniors who reach the “donut hole” – the point when they have to start paying prescription drug expenses themselves – now get a 50 percent discount when buying brand-name drugs and a 14 percent discount on generic drugs covered by Medicare Part D. More than 5 million older adults and people with disabilities have saved $3.5 billion in prescription costs since the law was passed. The donut hole will continue to shrink until it disappears completely by 2020.
Free preventive care.
New private health plans must cover and eliminate cost-sharing (co-payment, co-insurance or deductible) for proven preventive measures such as immunizations, Pap smears, and screening colonoscopies. Beginning August 2012, private health plans had to provide additional preventive measures to women, including free well-woman visits, screening for gestational diabetes, domestic violence screening, breastfeeding supplies, and contraception.
Workplaces run by religious organizations that object to birth control are to receive a special accommodation: their health plans must still offer the coverage, but the cost of it will be borne entirely by their insurance companies.
People on Medicare are also now entitled to the same free preventive coverage, and in addition get a free annual “wellness visit.”
More consumer protections.
Health insurers can’t set lifetime limits on your coverage or cancel if you get sick.
For more information:
ERIC WALTERS,
CELL: 602-616-1660
Eric Walters Insurance Services
14482 N 100th Place,
SCOTTSDALE AZ 85260
TEL:(480)-657-8595/FAX:(888)-397-0796
Email: /www.ewconsultant.biz
Eric's ACA blog site- for all the information!!
http://www.azhealthinsuranceblog.com
5/29/2014