The Affordable Care Act (ACA)
The Affordable Care Act (ACA):
Health Insurance Marketplace
What is the Health Insurance Marketplace?
The Affordable Care Act (ACA), also known as “health care reform” was signed into law in March 2010. The law made several changes to healthcare, including creating a Health Insurance Marketplace in each state.The goal of the Health Insurance Marketplace is to increaseaccess to affordable health coverage with a wide range of benefits.Individuals and small businesses will be able to use the Marketplace to shop for insurance plans beginning in 2014.
Who Can Buy a Plan through the Marketplace?
All individuals, families,and small businesses will be able to buy insurance plansthroughthe Health Insurance Marketplace.
The goal of the Marketplace is to help people who do not have access to affordable insurance easily compare and find coverage. Most people who have access to insurance through their jobs, Medicare or Medicaidshould continue to use that coverage. However, if someone is offered insurance through their job that is not “affordable,” that person may be able to get help from the government to buy a plan through the Marketplace. Here are the rules for someone who wants to get help from the government withthe cost of a Marketplace plan instead of taking their employer coverage:
- The individual (or family)’s income must be between 138% and 400% of the federal poverty levelAND
- The employer insurance plan is set up to cover less than 60% of the person’s health expenses (on average)OR
- The employer plan’s premiums cost the person more than 9.5% of their income
Beginning in 2014, people of all ages will be able to buy insurance. Because of the Affordable Care Act, insurance companies will not be allowed to deny health coverage to anyonefor having a “pre-existing condition.”(A pre-existing condition is a health condition that someone has before they enroll in an insurance plan.)
How Much Will InsuranceCost in the Marketplace?
Individuals and small businesses will be able to use the Health Insurance Marketplace to compare and shop for plans from a variety of insurance companies. The cost of a plan will vary based on what the plan covers. Many people will be able to get help from the government to pay the costs of a plan that they buy through the Marketplace:
- People with incomes below 400% of the federal poverty level(about $45,960 per year for one person in 2013) will qualify for help payingtheir monthly premiums. (The premium is the amount that a person must pay every month to have insurance coverage.) The federal government will send a payment directly to the person’s plan, so that their monthly premium cost is automatically lowered.
- People with incomes below 250% of the federal poverty level will also receive help with cost-sharing (deductibles and co-pays)throughout the year, in addition to help paying for their premiums.(A deductible is an amount that an individual must pay before their insurance plan will pay anything. Co-pays are amounts that an individual pays every time they use a service, such as visit to the doctor or picking up a prescription.)
The Affordable Care Act also created new rules for insurance companies to limit how much the companies may charge in monthly premiums. In 2014, all insurance plans(including those sold on and off of the Marketplace) may only use family size, age, geography, and tobacco use to determinea consumer’s monthly premium price. Insurance companies will also be limited in how much they can use these factors. (For example, an insurance plan may only charge an older person three times more than a younger person.)
How Do I Know Which Plan is Best for Me?
Health insurance “Navigators” (counselors) will be available to helpconsumers understand and choose plans. Navigators can help consumers complete ahealth insurance application online, over the phone, or in person.Through a single application,consumers can find out if they qualify for coverage through the Marketplace, explore their health coverage options, and see if they can get help with the cost of a Marketplace health plan.
Each state’s Marketplace will have a website and free phone number that consumers and Navigators can use to search for and compare insurance plans.
All plans sold on the Marketplace will be standardized and labeled as Bronze, Silver, Gold, or Platinum.This will help consumers know which plans offer similar levels of coverage.
What Benefits Will Be Covered by Plans in the Marketplace?
Individual and small grouphealth planssold on and off of the new affordable Health Insurance Marketplacemustoffer at least a basic package of items and services known as Essential Health Benefits. The Essential Health Benefits Include:
1. Ambulatory (Outpatient) services (doctor visits, etc.)
2. Emergency care services
3. Hospital Care
4. Maternity and newborn care
5. Mental health and substance use disorder services, including behavioral health treatment
6. Prescription drugs
7. Rehabilitative services and devices (to re-learn existing daily living skills) and habilitative services and devices(to learn, maintain, or improve daily living skills)
8. Laboratory services
9. Preventive and wellness services and chronic disease management
10. Pediatric (children’s health) services, including oral and vision care
Within each of theseEssential Health Benefit categories,insurance plans must provide a minimum amount of coverage. They will do this by basing theirbenefits on a benchmark plan. The benchmark plan must offer coverage that is equal to a “typical employer plan.” (In Illinois, the benchmark plan for 2014 is Blue Cross Blue Shield Blue Advantage HMO.)Individual and small group health plans may offer morebenefits than the benchmark plan, but they cannot offer less.
For more information about the Affordable Care Act and the Health Insurance Marketplace, please visit:www.healthcare.gov or marketplace.cms.gov.