After years of planning, it’s almost time for implementation for one of the most important components of the Affordable Care Act. People will be able to begin shopping for coverage on the Health Insurance Marketplace on Oct. 1.
For those of you who long ago decided to worry about this when it got here: It’s almost here. Here are the answers to 23 basic questions about the marketplace, but many of you can stop after No. 2.
1. What’s all this fuss about Oct. 1?
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Under the Affordable Care Act, almost everyone will be required to have health insurance in 2014. The federal Health Insurance Marketplace, where you can shop online at healthcare.gov for the best policy to fit your needs in 2014, opens Oct. 1.
2. What if I already have health insurance?
Most of you – somewhere in the 65-75 percent range – can ignore the new marketplace. If you are covered by Medicaid, Medicare or the State Health Plan, you don’t need to do anything. If you are covered by a group insurance plan through your job, you almost certainly will be better off sticking with your current insurance. Those on group policies can go on the new marketplace to check out the potential cost to switch, but they won’t qualify for tax credits. Without the tax credits, the new marketplace policy almost certainly will be more expensive than your old group policy.
3. What if I have individual health insurance or I’m uninsured now?
Everyone who is uninsured now and anyone with individual health insurance should go to online to healthcare.gov – or go to one of the many organizations helping people sign up for the Health Insurance Marketplace – to see how much it’ll cost. To sign up for insurance, you’ll need basic identification information, an estimate of your household income in 2014, an email address and access to the Internet.
4. If “almost everyone” is required to have insurance, who is exempt from the requirement?
The exceptions include American Indians, some religious sects that eschew medical care, people in prison and people who earn so little money they aren’t required to pay taxes. Also, because South Carolina turned down the expansion of Medicaid, state residents making less than about $14,500 are exempt from the penalty.
5. What if I don’t have an email address or access to the Internet?
There are lots of people who can help you get on the Internet and set up an email address. The federal government provided grants to local groups to serve as Navigators or Certified Application Counselors. Some will offer help in their offices, and many will provide outreach efforts in the community. Also, since many people without home Internet access use computers at public libraries, most libraries have staff members trained to at least get people started on healthcare.gov.
6. Identity theft is a major problem. How can I trust the people helping me?
That’s a real concern because you will need to use your Social Security number to sign up. If you or a family member feel comfortable filling out forms on the Internet and have a home computer, sign up from home. If you must have help, the workers for the grant-funded Navigator and Certified Application Counselor groups in South Carolina have had background checks and privacy training. In the Midlands, those groups include the Benefit Bank of SC, The Cooperative Ministry, the S.C. Progressive Network, the Greater Columbia Community Relations Council and federally qualified health clinics such as the Eau Claire Cooperative Health Centers.
7. Can I buy from a standard insurance agent or broker?
Yes. In fact, a commission fee is built into the marketplace policies, so it doesn’t cost you anything. You should be seeing advertisements soon for agents who want that business. One company, HealthAviator.com, introduced an online registration effort with a splash this week. Be careful that you’re dealing with an agent that is certified by the Centers for Medicare and Medicaid Services. That means they have special training on the new marketplace.
8. What can the agent/broker provide that I can’t get from Navigators or Certified Application Counselors?
Navigators and Certified Application Counselors legally can’t give you advice on which policy is best for you. They just help you get to that stage in the application process and explain terms. You have to make the decision and push the buttons. An agent/broker can explain why one policy might be better for your specific situation. And the agents/brokers in most cases have much more experience in the insurance market.
9. Do I have to complete the process all at once?
No. You can stop at any point and pick up again at the same point on another day. As with any important life decision, that’s probably a smart idea just to make sure you are certain about your choice.
10. How much will my insurance cost?
That’s the big question, and the answers won’t be available until the marketplace opens on Oct. 1. You probably read or heard about the many estimates on increases or decreases in insurance costs in various states, but those all were averages, often with a political tilt. Every person will have different circumstances. Family size, income and, to a lesser extent, age, will factor into costs. So will the level of insurance you select.
11. What if I don’t want insurance?
That is an option, but you will be penalized. The first-year fine will be $95 or 1 percent of your household income, whichever is greater. The penalty will grow in the future. The penalty phase of the Affordable Care Act is tied in with the federal tax system, so you won’t face the fine until you file your 2014 tax return in 2015.
12. Will I be eligible for tax credits to help pay for my insurance?
Probably. The tax credits are based on income. If your annual income is $11,500 to $46,000 – or if your family of four makes up to about $94,000 – you’re eligible for a tax credit on premiums for insurance purchased on the Health Insurance Marketplace. The size of the credits is on a sliding scale based on income, so people on the high end of that range will get smaller credits.
13. Will I have to wait until I file my tax return to get the credit?
No. The subsidy is deducted from the insurance cost up front, so you don’t have to wait until the next year to receive the benefit.
14. What about people making less than $11,500?
They aren’t eligible for a tax subsidy. That inequity results from South Carolina turning down Medicaid expansion. About 284,000 uninsured South Carolinians making less than $11,500 would have been covered by the expansion of Medicaid. But at least they are exempt from the penalty for not having insurance.
15. What are the levels of insurance in the new marketplace?
This is where you have to make difficult choices. The four main levels are bronze, silver, gold and platinum. The bronze is cheapest, but it covers only 60 percent of your health care costs, which includes basics such as doctor visits, hospital care and prescription drugs. You have to pay the other 40 percent out of pocket. The silver plan covers 70 percent, gold 80 percent and platinum 90 percent. What you pay in premiums for the insurance coverage goes up at each level. The government has set up tax credits and other incentives that will steer people to the silver plan. Those younger than 30 who have no other affordable insurance option have a fifth choice — catastrophic coverage — with fewer benefits and even higher out-of-pocket costs than the bronze plan.
16. What if I don’t have time to get this done in early October?
The Oct. 1 date is the starting line. There are multiple possible finish lines. It might be smart to let others be the guinea pigs for the first few weeks of the new system. You need to sign up by Dec. 15 to have insurance on Jan. 1, 2014. But the law allows a three-month lapse in insurance coverage each year. So you can avoid a penalty by signing up before March 15, which would allow you to be covered by April 1. The marketplace for 2014 insurance closes March 31. Some major changes in life circumstances, such as losing a job, allow people to sign up after March 31.
17. Would I be better off buying insurance or paying the penalty for having none?
If you’re extremely healthy and never have medical expenses, you might choose the penalty. But if you do that, you’re gambling that you won’t get sick or suffer an accidental injury. If you lose the gamble, the financial costs will be high.
18. What happened to the insurance exchanges?
During the summer, the term “insurance exchange” was replaced with “Health Insurance Marketplace.” South Carolina, like many states, opted not to form its own exchange. That means we sign up on the federal exchange, or as it’s now known, the Health Insurance Marketplace.
19. How many different companies are offering insurance in the Health Insurance Marketplace in South Carolina?
There are four: BlueCross BlueShield of S.C., BlueChoice, Consumers’ Choice Health Plan and Coventry Health Care of the Carolinas. (That’s more than many other states.) They all are required to offer basic coverage at each of the four levels of insurance, but there will be subtle differences. Some of those differences might not be obvious on healthcare.gov. Expect plenty of marketing from the companies to extol the special benefits of their coverage.
20. Do I have to buy insurance from those four companies?
No. There are other companies offering individual insurance off the exchange. But you aren’t eligible for the Affordable Care Act tax credits if you buy from companies off the exchange. The most likely candidates to buy off the exchange are people near the upper end of the income eligibility range for tax credits. Their tax credits will be small for policies on the exchange. For instance, a family of four making $80,000 should check out costs both inside and outside the exchange.
21. I’m a business owner. What about the mandate for me to offer insurance to my employees?
The employer mandates have been delayed until 2015. While some provisions of the Affordable Care Act already are impacting group insurance premiums, companies don’t face penalties for not offering insurance until 2015. Some provisions that offer tax incentives for small businesses who supplement their employee’s insurance begin in 2014.
22. The premium for my group insurance through work went up this year. Is that related to the Affordable Care Act?
In part. Premiums have been going up for years and probably would have continued going up anyway. But provisions of the new law also will add to costs for insurance companies, and those will be passed along to customers.
23. I would rather talk with a person than try to find answers to my questions online. Who do I call for questions about the Health Insurance Marketplace?
The federal call center is (800) 318-2596. As the Oct. 1 starting line nears, you also can get some questions answered at the local 2-1-1 line operated by the United Way and staffed in part by state Medicaid staffers.