Embed Size (px)
Citation preview
Page 1
The Health Benefit Exchange and The Health Benefit Exchange and the Small Group Marketthe Small Group Market
Department of Health and Social Services
Page 2
Agenda
Welcome and Introductions
Health Insurance Exchange Markets
Employer Eligibility
Participation and Contribution Requirements
Purchasing Models
Premium Billing, Collection, Remittance
Key Issues for Delaware
Questions/Open Discussion
Page 3
Overview of the Health Benefit Exchange | What is it?
“Expedia” for health insurance:
Organized commercial insurance marketplace for individuals and small employers (up to 50 employees)
Enables consumers to compare plans and enroll in coverage
One-stop shop for publicly subsidized health coverage:
Medicaid
Delaware Healthy Children Program (CHIP)
Subsidized commercial insurance
Source of information on carriers and plan performance
Page 4
Exchange | Core Responsibilities
Develop single, streamlined eligibility process for all public health coverage programs
Offer “qualified health plans” in five benefit groups, which will differ based on point-of-service cost sharing (e.g., co-pays, co-insurance, deductibles):
Platinum (90% actuarial value)
Gold (80% AV)
Silver (70% AV)
Bronze (60% AV)
High Deductible Health Plan (individual market only)
Page 5
Exchange | Core Responsibilities
Offer health plans in the individual and small group markets:
Premium subsidies and lower out-of-pocket costs available to eligible individuals and families with income up to 400% of the Federal Poverty Level (e.g., up to $43,561 for an individual)
Premium subsidies available to small employers with lower-wage employees
Develop “calculator” to enable people to estimate total cost of coverage (e.g., premiums, co-pays, deductibles)
Page 6
Exchange | Single Premiums
Page 7
Income as % of FPL
Annual Income
Monthly Income
Premiums as % of Income
Monthly Premium
133% $14,484 $1,207 3% $36.21
150% $16,335 $1,361 4% $54.45
200% $21,780 $1,815 6.3% $114.35
250% $27,225 $2,269 8.05% $182.63
300% $32,670 $2,722 9.5% $258.64
350% $38,115 $3,176 9,5% $301.74
400% $43,560 $3,630 9.5% $344.85
Exchange | Single Premiums
Page 8
Income as % of FPL
Annual Income
Monthly Income
Premiums as % of Income
Monthly Premium
133% $29,725 $2,477 3% $74.31
150% $33,525 $2,794 4% $111.75
200% $44,700 $3,725 6.3% $234.68
250% $55,875 $4,656 8.05% $374.83
300% $67,050 $5,587 9.5% $530.18
350% $78,225 $6,519 9,5% $619.28
400% $89,400 $7,450 9.5% $707.75
Exchange | Family of Four Premiums
Page 9
Employer Eligibility
In 2014, Small Business Health Options Program (“SHOP”) Exchange will offer health insurance to small employers Businesses with 50 or fewer full-time employees allowed to
purchase coverage through SHOP Exchange in 2014 and 2015;
SHOP Exchange must serve groups of 100 or fewer full-time employees in 2016 and beyond; and
State may choose to expand Exchange to larger groups in 2017.
Employers with low-wage workers may be eligible for premium subsidies through the Exchange Firms with up to 25 employees;
Average wages of $50,000 or less; and
Up to 50% tax credit available for two years.
Page 10
Individual and SHOP Exchange
State may choose to establish two Exchanges: Individual market Exchange – American Health Benefit Exchange
Employer Exchange – SHOP Exchange
Or one Exchange that serves both the Individual and Employer markets For administrative purposes, a single Exchange with separate risk
pools can be used to serve both markets
Combining the Individual and SHOP Exchange does not require the State to merge these two markets
Page 11
Participation and Contribution Requirements
Under current underwriting rules, insurers require employers to meet certain participation and contribution requirements
Participation: Employers with five or fewer employees generally required to have
all employees enroll in employer-sponsored insurance (with exceptions for spousal coverage)
Employers with six or more employees required to enroll 75% of eligible employees in employer-sponsored insurance
Contribution: Employers must contribute at least 50% of premium
Page 12
Purchasing Models of the Exchange
Federal law provides flexibility in how the SHOP Exchange can offer coverage to employers and their employees
Upcoming federal regulations will further define the purchasing options for the SHOP Exchange
Four potential purchasing models: One Carrier, One Plan
One Carrier, Multiple Plans
All Carriers, One Plan Level
All Carriers, All Plan Levels
Each model can support range of contribution strategies
Page 13
Option 1 -- One Carrier, One Plan
Monthly Premiums for Single Coverage
Plan/Carrier
Carrier A Carrier B Carrier C Carrier D
Platinum $540 $531 $518 $554
Gold $480 $472 $460 $492
Silver $420 $413 $403 $431
Bronze $360 $354 $345 $369
70% Employer contribution = $289 and 30% Employee contribution = $124
Page 14
Option 2 -- One Carrier, Multiple Plans
Monthly Premiums for Single Coverage
Plan/Carrier
Carrier A Carrier B Carrier C Carrier D
Platinum $540 $531 $518 $554
Gold $480 $472 $460 $492
Silver $420 $413 $403 $431
Bronze $360 $354 $345 $369
Page 15
Option 2 -- One Carrier, Multiple Plans
Example of Contribution Split Between Employer and Employee
Carrier B Total Premium
ER Share EE Share
Platinum $531 $289 $242
Gold $472 $289 $183
Silver $413 $289 $124
Bronze $354 $289 $65
Page 16
Option 3 – Multiple Carriers, One Plan Level
Monthly Premiums for Single Coverage
Plan/Carrier
Carrier A Carrier B Carrier C Carrier D
Platinum $540 $531 $518 $554
Gold $480 $472 $460 $492
Silver $420 $413 $403 $431
Bronze $360 $354 $345 $369
Page 17
Option 3 -- Multiple Carriers, One Plan Level
Example of Contribution Split Between Employer and Employee
Silver Level Total Premium
ER Share EE Share
Carrier A $420 $289 $131
Carrier B $413 $289 $124
Carrier C $403 $289 $114
Carrier D $431 $289 $142
Page 18
Option 4 – All Carriers, All Plan Levels
Monthly Premiums for Single Coverage
Plan/Carrier
Carrier A Carrier B Carrier C Carrier D
Platinum $540 $531 $518 $554
Gold $480 $472 $460 $492
Silver $420 $413 $403 $431
Bronze $360 $354 $345 $369
Page 19
Option 4 – All Carriers, All Plan Levels
Example of Employee Share of Monthly Premiums
Plan/Carrier
Carrier A Carrier B Carrier C Carrier D
Platinum $251 $242 $229 $265
Gold $191 $183 $171 $203
Silver $131 $124 $114 $142
Bronze $71 $65 $56 $80
** Employer share of premiums fixed at $289, or 70% of Carrier B’s Silver Level plan’s premiums.
Page 20
Premium Billing, Collection, Remittance
Page 21
Premium Billing, Collection, Remittance
Page 22
Key Issues for Delaware
Should the State establish one Exchange or separate Exchanges to serve the individual and group markets?
Should the individual and small group market risk pools be combined or remain separate?
What type of purchasing model will best meet the needs of Delaware employers, employees, and insurers?
Is there a particular market segment that the SHOP Exchange may best serve?
Page 23
Key Issues for Delaware
Should the State’s Exchange establish minimum contribution and participation requirements for small employers purchasing coverage through the Exchange?
How will these contribution and participation requirements apply in an “employee choice” model?
Should small groups be limited to 50 or fewer employees until 2016, when the definition of small groups must be expanded to 100 employees?
What might be the effect on the broader commercial insurance market from the introduction of the Exchange?
