Consumer Healthcare Guide to the Reform

There is much debate over if this Reform is good, bad or ugly.  What is clear, is that it is going to impact every one of us; consumers, employers, insurance companies, hospitals and doctors.

While everything doesn’t really get “kicked in” until 2014, people are already getting prepared, and things are changing.

Here are some things as it is now, and what is to come.  Since change is constant … please visit us often to keep up!!!

I don’t have health insurance. Will I have to buy it and what if I don’t?

Today, you are ok if you don’t have health insurance (well you won’t be fined that is). Starting in 2014, depending on your income and possibly other factors, you will have to have it or pay a fine (or tax – not sure what they are calling it).  This tax may be able to be waived for several reasons, including financial hardship or religious beliefs.

They are estimating millions of people will qualify for Medicaid or federal subsidies and will be able to buy insurance that way.

I have group coverage at my job, will I be able to keep that? Will my benefits change?

If your company provides insurance, it will probably stay that way. Your employer is not obligated to keep the current plan, so they can change premiums, deductibles, co-pays and/or the network coverage.   We have seen a lot of small employers under 50 making a lot of changes because of the reform.  In addition, you may have already seen some companies making dependant changes; what already took effect was the fact that the plans had to guarantee that an adult child up to age 26 who can’t get health insurance at a job could stay on their parents’ health plan.

I can’t afford health insurance, but I want it. What do I do?

The federal government’s plan is, depending on your income, you can apply for Medicaid. Currently, in most states nonelderly adults without minor children don’t qualify for Medicaid. But beginning in 2014, the federal government is offering to pay the cost of an expansion in the programs so that anyone with an income at or lower than 133 percent of the federal poverty level,  will be eligible for Medicaid.   What if you don’t qualify for Medicaid and still can’t afford health insurance?

Then there are the government subsidies that you may be eligible for.  They help you pay for insurance bought through the exchanges, which should be available October 2014. This will be private insurance from insurance companies offered to individuals and small businesses. We plan to be one of the agencies offering these plans to you as well.

What if I have a pre-existing condition, will it be harder for me to get coverage?

After 2014, Insurers will not be able to decline an applicant based on health status.  That is good and bad.  If you are healthy, you want to get insurance NOW, and possibly lock in a lower rate while you can be underwritten.  Once all plans are treated the same, the rates are anticipated to be much higher and a healthly person will be paying much more.

I am a small employer. Do I have to buy health insurance for my employees?

You are not required to provide insurance. Starting in 2014, employers with 50 or more employees that don’t provide health care coverage and have at least one full-time worker who receives subsidized coverage in the health insurance exchange will have to pay a fee of $2,000 per full-time employee. The firm’s first 30 workers would be excluded from the fee.

Small employers with 50 or fewer people won’t face any penalties.

In addition, if you own a small business, the health law offers a tax credit to help cover the cost. Employers with 25 or fewer full-time workers who earn an average yearly salary of $50,000 or less today can get tax credits of up 35 percent of the cost of premiums. The credit increases to 50 percent in 2014.

We offer many solutions to help you work through the law and get all the credits and eliminate the penalties.  Click for more info.

I’m over 65. Is it going to affect my Medicare?

The law has made a lot of good and bad things happen for beneficiaries.  With the changes, more and more doctors are not taking Medicare, which is the main negative.  The reason why is because they are basically not getting paid as much.  This is more and more reason to have additional coverages to Medicare.  Click to see more.

The good things the law did was it expanded Medicare’s coverage of preventive services, such as screenings for colon, prostate and breast cancer, which are now free to beneficiaries. They pay for an annual wellness visits to the doctor. Preventative care is so important in keeping healthy, so use these FREE services!   Because the law reduced the payments to Medicare Advantage plans, some say these cuts could mean the Advantage plans may not offer many extra benefits, such as free eyeglasses, hearing aids and gym memberships, that they now provide. The reason for the cuts was because Medicare Advantage costs more per beneficiary than traditional Medicare.

Will I have to pay more for my health care because of the law?

That is a million dollar question and an argument no one knows the answer to.

That said, there are some new taxes and fees. For example, starting in 2013, individuals with earnings above $200,000 and married couples making more than $250,000 will pay a Medicare payroll tax of 2.35 percent, up from the current 1.45 percent, on income over those thresholds. In addition, higher-income people will face a 3.8 percent tax on unearned income, such as dividends and interest.

Starting in 2018, the law also will impose a 40 percent excise tax on the portion of most employer-sponsored health coverage (excluding dental and vision) that exceeds $10,200 a year and $27,500 for families. The tax has been dubbed a “Cadillac” tax because it hits the most generous plans.

In addition, the law also imposes taxes and fees on several major health industries. Beginning in 2013, medical device manufacturers and importers must pay a 2.3 percent tax on the sale of any taxable medical device to raise $29 billion over 10 years. An annual fee for health insurers is expected to raise more than $100 billion over 10 years, while a fee for brand name drugs will bring in another $34 billion.

Those fees will likely be passed onto consumers in the form of higher premiums.

In our opinion, being in the insurance industry for over 30 years, we feel very sure people under 30 will pay more after 2014 than what they would pay right now for the same plan.  People over 55 will pay a little less than what they might pay now.  Overall, premiums are going to go up for everyone we estimate 12%-20% across the board maybe more, sadly we do not feel they will be going down at all because of the reform.

Other parts of the law now in place:

You are likely to be eligible for preventive services with no out-of-pocket costs, such as breast cancer screenings and cholesterol tests.   Health plans can’t cancel your coverage once you get sick – a practice known as “rescission” – unless you committed fraud when you applied for coverage.

Children cannot be denied coverage even if they have pre-existing conditions, however the companies can rate up for that condition; some up to 800% of the premiums.  FYI – This has adversely cause the companies to stop offering child-only policies.  This will apply to adults in 2014.

Insurers will have to provide rebates to consumers if they spend less than 80 to 85 percent of premium dollars on medical care.  You may have already gotten some money back from the insurance company on your policy and wondered what it was for.

Some existing plans, if they haven’t changed significantly since passage of the law, do not have to abide by certain parts of the law. For example, these “grandfathered” plans can still charge beneficiaries part of the cost of preventive services.

If you’re currently in one of these plans, and your employer makes significant changes, such as raising your out-of-pocket costs, the plan would then have to abide by all aspects of the health law.

The law has already hit some obstacles:

For example, the law created high-risk insurance pool (PCIP) to help people purchase health insurance. But enrollment in the pool has been less than expected. As of Aug. 31, 86,072 people had signed up for the high-risk pools, but the program, which began in June 2010, was initially expected to enroll between 200,000 and  400,000 people. The cost and the requirements have been difficult for some to meet.   Applicants must be uninsured for six months because of a pre-existing medical condition before they can join a pool. And because participants are sicker than the general population, the premiums are higher.  (What does this tell you?  If in 2014 nobody can be declined by an insurance company, then wouldn’t insurance be more expensive?)

Enrollment has increased since the summer, after the premiums were lowered in some states by as much as 40 percent and some states stepped up advertising.

As always visit our blog, subscribe to our newsletter, become a fan, however you wish … stay up to speed on the HealthCare Reform with us.  We will make sure we keep you up-to-date with the most accurate information we have.

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