How Does the Heathcare Marketplace Work?

How Does the Iowa Health Insurance Marketplace Work?Changes under the Healthcare Reform1The Individual Mandate2First there were two choicesUnder the Affordable Care Act every individual must have Minimum Essential Health care Coverage or Pay a Tax Penalty.

3Minimum Essential CoverageMinimum Essential Coverage is some form of major medical healthcare coverage such as:MedicareTRICARE or VA Medical Benefits Must be comprehensive, not limited in scope.Medicaidhawk-iEmployer based health insuranceMajor medical health insurance purchased on the individual market4Tax Penalty201420152016Minimum$95$325$695Percent of Income past Filing Threshold1%2%2.5%If an individual does not have Minimum Essential Coverage they must pay the greater of the two penalties on their taxes.In years after 2016 the penalty is indexed to the rate of medical inflation.Parents are responsible for their children too!

5There are a number of exceptions to the requirement for Minimum Essential CoverageIf a person is incarceratedIf a person is an undocumented immigrantIf a person is a member of an Indian TribeIf a person qualifies for a religious exemptionIf a person is a member of a healthcare sharing MinistryIf premiums for health insurance would cost more than 8% of your annual household incomeIf your income is below the filing threshold for taxesIf paying for health insurance would be a hardship for your household

6Annual versus Monthly Exceptions DHS Suggestion6Do I need to make any changes to avoid the penalty?Are you uninsured? Call the MarketplaceDo you like your current health insurance?You can only qualify for tax credits on plans purchased on the Health Insurance Marketplace.You may be able to keep your current plan.Or you can shop on the marketplace to see if there is a better deal.Are you on Medicare? No change neededAre you on Medicaid? No change neededAre you on IowaCare? IowaCare ends on December 31, 2013. All IowaCare members will receive instructions on how to find new health care coverage.7Shop around AND look for tax credits!7What IS the Iowa Health Insurance Marketplace?8The Iowa Health Insurance MarketplaceIowa is using the Federal Health Insurance Marketplace.The Marketplace is a place for people to look for affordable minimum essential coverageThere is a single application process for Medicaid (including the Iowa Health and Wellness Plan), hawk-i Tax Credits, and Cost Sharing Subsidies.Applicants shopping for insurance on the Marketplace will have the choice of multiple private insurers.

9Who can use the Marketplace?Generally: Anyone can use the Iowa Health Insurance Marketplace.Only people who meet certain income, and health coverage conditions can qualify for government programs and tax credits.If youre interested you can apply and see if you qualify for any help.10

What Plans and Programs are Included on the Marketplace?11MedicaidMedicaid provides low-cost or free health care coverage for low income individuals, such as: Children Adults People with disabilities Elderly peopleNot available to non-citizensMedicaid provides comprehensive health care coverage, such as:Hospitals, physicians, prescriptions drugs, therapy, dentalCovers long term care services Medicaid members can go to most Iowa health care providers.You may apply for Medicaid on the Marketplace.12How Medicaid Fits with the Health Insurance Marketplace13Income Level for an Individual400% of the Federal Poverty LevelMedicaid Coverage for Adults(19-64)Medicaid Coverage forChildren(0-18)PopulationMay Be Eligible for Tax Credits to Purchase Private Coverage from Health Insurance MarketplacePurchase Private Coverage from Health Insurance Marketplace: Not Eligible for Tax CreditsMedicaid provides coverage to children with family income up to 300% of the Federal Poverty Level

Medicaid provides coverage to adults with income up to 133% of the Federal Poverty Level

Individuals whose income is higher than Medicaid allows may be eligible for tax credits on the Health Insurance MarketplaceIowa Health &Wellness PlanNew plan beginning January 1, 2014.Available for adults age 19-64:Not eligible for other Medicaid or Medicare coverage. With income up to 133% of the Federal Poverty Level, or $15,282 per year for a family of one.Created to provide comprehensive health care coverage for low-income adults.Program will provide local access to doctors, hospitals, and other providers.Will cover many services like hospitals, physicians, preventive care, prescriptions drugs, therapy, dentalMany members previously enrolled in IowaCare, may be eligible for this programYou may apply for the Iowa Health and Wellness Plan on the Marketplace.14hawk-iProvides health care coverage for uninsured children of working families.Family income must be below 300% of the Federal Poverty LevelNo family pays more than $40 per month.Children are covered through commercial health care and dental plans.To qualify, children must:Be under 19Have no other health insuranceLive in IowaBe a U.S. citizenNot qualify for MedicaidNot be a dependent of a State of Iowa EmployeeYou may apply for hawk-i on the Marketplace.15What will insurance plans on the Marketplace Look Like?Bronze - Lowest premium and highest out of pocket costs. Cost sharing of 60% paid by insurer and 40% by the individual.Silver - Lower premiums than gold and platinum, but with higher out of pocket costs. Cost sharing of 70% paid by insurer and 30% by the individual.Gold - Lower premiums than platinum, but with higher out of pocket costs. Cost sharing of 80% paid by the insurer, and 20% by the individual.Platinum - Highest premium with lowest out of pocket costs. Cost sharing of 90% by insurer, and 10% by the individual.Catastrophic Plans Certain people up to the age of 30 may select to purchase plans with very high deductibles and low premiums.16What will insurance plans on the Marketplace Look Like?Benefits will includePrescription drugsEmergency servicesHospitalizationMaternity & newborn carePediatric servicesLaboratory ServicesAmbulatory Patient ServicesMental health & substance abuse servicesRehabilitative & habilitative services and devicesPreventative & wellness services and chronic disease management

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Premium Assistance & Cost Sharing18Federal Poverty Level Guidelines (FPL) 201319Household Size100%133%150%200%300%400%1$11,490$15,282$17,235$22,980$34,470$45,9602$15,510$20,628$23,265$31,020$46,530$62,0403$19,530$25,975$29,295$39,060$58,590$78,1204$23,550$31,322$35,325$47,100$70,650$94,2005$27,570$36,668$41,355$55,140$82,710$110,2806$31,590$42,015$47,385$63,180$94,770$126,3607$35,610$47,361$53,415$71,220$106,830$142,4408$39,630$52,708$59,445$79,260$118,890$158,520Each Additional Person$4,020$5,347$6,030$8,040$12,060$16,08019* Based on Modified Adjusted Gross IncomeIf your income and household size fall within this chart you may get benefits.19Modified Adjusted Gross Income?Modified Adjusted Gross Income is the amount of gross income earned, with a few things added in and deducted.There are some deductions taken away, such as business expenses.There is some money that is normally non-taxed added in, such as non-taxable interest.The take away is that if you are near the income cut off, you still might qualify for assistance.The only way to find out is to apply.20Health Premium Tax CreditsCertain people may qualify for tax credits to help them purchase insuranceThe tax credit can reduce what you owe in taxes OR what you pay for health insurance premiums.They must:Have a household Modified Adjusted Gross Income between 100% and 400% of the federal poverty guidelines.Not be eligible for Minimum Essential Coverage from some other source, for example Medicaid.Be lawfully present in the U.S., and may not be incarcerated.Must purchase health insurance through the exchange.A person might still qualify for tax credits if coverage from their employer is not Affordable or does not provide Minimum Value.21MAGI removes things like business expenses, adds things like non-tax interest from investments21What is considered Affordable under the law? What is Minimum Value?An Employers plan is Affordable if the cost to insure the employee only is less than 9.5% of the employees household income.An Employers plan provides Minimum Value if it covers 60% of the expected medical expenses.22

To find out what percent of the costs your plan is expected to cover, ask your employer, or their insurer.22How do I save with a Health Premium Tax Credit?The tax credit can reduce what you owe in taxes OR what you pay for health insurance premiums.Tax Credit = cost of the Silver benchmark plan a households required contribution.The Silver benchmark plan is the second least expensive Silver plan in the marketplace.

23Example 3 silvers plans, A, B, and C. A costs $100 a month, B costs $110 a month, and C costs $120 a month. B is the Silver benchmark.23Required Contribution?A households required contribution is a fixed percentage of the household income. This is a sliding scale based upon the annual income. (see table)The goal is to keep healthcare spending to a limited portion of a households income.Go to http://kff.org/interactive/subsidy-calculator/ to estimate your tax credit!

% of FPLLow End of RangeHigh End of Range100-13322133-15034150-20046.3200-2506.38.05250-3008.059.5300-4009.59.524Things to Consider with Health Premium Tax CreditsThe tax credit may be taken and applied towards any of the plans available on the market place.The tax credit may be paid monthly to the insurance company to reduce the monthly premium or taken at the end of the year as a lump sum.The amount of the tax credit is capped at the cost of the actual plan purchased.25The Final Tax Credit is Figured at the End of the YearIf you overestimate your income you may get a refund at the end of the year.If you underestimate your income you may owe the government money.The amount you need to pay back is limited by income and household size. (see table*)If your income changes during the year, let the Marketplace know!

FPL %SingleFamilyLess than 200%$300$600200%-300%$750$1,500300%-400%$1,250$2,50026*26 CFR 1.36B-4(a)(3)26Cost Sharing SubsidiesIf a consumer is enrolled on a Silver plan they may qualify for cost sharing subsidies to decrease their share of costs.

A Silver plan has coinsurance of 30% paid by the consumer and 70% paid by the insurance company. With Cost Sharing Subsidies, the coinsurance is instead reduced to the following:27Federal Poverty LevelCoveredConsumer Pays200% to 250%73%27%150% to 200%87%13%100% to 150%94%6%Where Can I Sign Up for the Marketplace?28You can enroll in the Marketplace at:

Healthcare.gov

1-800-318-2596

With a paper application29

Enrolling in the Marketplace30When can I sign up?You can only enroll in an insurance plan during Open Enrollment or Special Enrollment.Open Enrollment for the first year is from October 1st 2013 till March 31st, 2014.Open Enrollment for 2015 starts October 15th 2014, through December 7th 2014.If you dont sign up during the open enrollment you may only sign up during a Special Enrollment period.Programs such as Medicaid and hawk-i, may be enrolled in year round.31Special Enrollment PeriodMay enroll or change Qualified Health PlanWithin 60 days in individual market and 30 days in small group market from qualifying event

Special Enrollment Period Qualifying EventsLoss of minimum essentialcoverageMaterial contract violations by Qualified Health PlansGaining or becoming adependentGaining or losing eligibility for premium tax credits or cost sharing reductionsGaining lawful presence Relocation resulting in new or different Qualified Health Plan selectionEnrollment errors of the MarketplaceExceptional circumstances*32* May be granted on a case by case basis.What if I need help signing up?NavigatorCertified Application CounselorFunded by federal grants to help people enroll in the marketplaceCannot have a conflict of interestMust provide information in an impartial mannerMust provide consumer education and outreach programsMust be trained and have passing scores on certification testMay not charge a fee for their servicesDo not receive funding to help enroll people.Must disclose any potential conflicts of interest to applicantsMust act in the best interest of the applicantMust complete trainings and receive passing scoresMay not charge for consumer services

33Their job is to help people select insurance plans.Must be trained in health insuranceMust be licensed by the state of IowaMust act in the interest of their clients.Insurance Agents and BrokersOther Sources of HelpYou can call the marketplace, 1-800-318-2596 Or you can shop online at healthcare.gov34

When can an Insurance Company Cancel a Policy?If the consumer qualifies for MedicareIf the consumer does not pay their monthly premiumsIf the consumer commits fraud on their application.If the policy is no longer offered or is removed from the Marketplace.35Only if asked: 3 Month grace period, but claims after the first month of the period may not be paid unless you catch up with your premiums.

35Watch out for FraudIf you are suspicious about a request for personal information DO NOT GIVE IT OUT!The ONLY website for the Marketplace is healthcare.govIf you get a suspicious phone call. DO NOT give out your personal information.Call the Marketplace and let them know.1-800-318-259636Other Changes37Other Consumer Protections Under the Healthcare Reform Coming in 2014Health Insurance Companies cannot refuse to cover you during open enrollment.They cant charge you more because you have chronic or pre-existing conditions.They cant charge more for women than men.

38What Can Affect My Insurance Rates?Insurance companies can now only vary their rates based upon;Age (limited ratio of 3 to 1)Tobacco Use (limited ratio of 1.5 to 1)Number of person on the policyWhere you live39Additional Consumer ProtectionsThese Reforms are in EffectPlans must be presented in a uniform manner to make easy apple to apple comparisons of coverage.Medical Loss Ratio RebatesDependant coverage extended up to age 26.Insurers may only rescind policies in the case of fraudInsurance Companies can no longer set lifetime or yearly spending limits.These Reforms are Coming in 2014The waiting period to get on group plans is limited to 90 days.40Things to Remember?All individuals will face a tax penalty if they dont have minimum essential coverage and they dont have an exception.Low and Middle income individuals may qualify for government programs or tax credits to help them get health insurance.The change in laws may expand the benefits you receive on new policies and it will change the way premiums are calculated.Open enrollment runs Oct.1, 2013 March 31, 2014!!!!!!! Individuals may select Marketplace policies on healthcare.gov . 41Question & Answer42Thank You!Go to healthcare.gov to shop or enrollCall 1-800-3182596

Presented By:State Interagency Team:Iowa Insurance DivisionIowa Department of Human ServicesIowa Department of Public Health

43Tax Penalty Example 1Eric has the option to get affordable minimum essential health insurance in 2014, and decides not to get it. In 2014 Eric earned $14,000.Eric has a filing threshold of $12,000.Eric must pay the greater of;$95, the minimum flat amount or $20, 1% of his income past the tax filing threshold.($14,000 - $12,000) = $2,000 * 1% = $20Eric must pay a tax penalty of $9544Penalty Example 2In 2014 Jenny had the option to purchase affordable health insurance, that provides minimum value, and did not. She earned $120,000 in 2014.Jenny has a filing threshold of $12,000.She has to pay the greater of;$95, the minimum flat amount or$1,080, 1% of her income past the tax filing threshold.($120,000 - $12,000) = $108,000 * 1% = $1,080Jenny must pay a $1,080 tax penalty.

45Silver Benchmark Example:Silver plans: A, B, C, and D.

A costs $100 a month, B costs $110 a month,C costs $120 a month, and D costs $130 a month.

B is the Silver benchmark.

46Example 1Household of 2 adults making $60,000 per year. Their required contribution is 9.5% or $5,700 per year. The Silver benchmark premium is $7,000 per year.Tax Credit = $7,000 (Silver Benchmark) - $5,700 (Required Contribution) = $1,300Tax Credit = $1,300

47Example 2Family of 4, two adults and two children making $40,000 annually. The Silver benchmark premium is $10,781, their required contribution is 5.89% or $2,650 per year.Tax Credit = $10,781 (Silver Benchmark) - $2,650 (Required Contribution) = $8,131Tax Credit = $8,13148Dont worry if this sounds complicated. The Marketplace will do the calculations for you. You can get an estimate at kff.org and look for the subsidy calculator.48