Health Insurance Marketplace

Waco Rotary ClubOctober 7, 2013

The Affordable Care ActSummary

• The Patient Protection and Affordable Care Act (ACA) was passed into law in 2010. A key component of the law mandated that all Americans be covered by a Qualified Health Plan (plan offering “Essential Health Benefits”) by January 2014.

• The ACA law provides individuals with subsidies that lower premium costs and lowers a patient’s cost-sharing obligation.

• In support of the mandate, the Federal Government has created a Health Insurance Marketplace available through a government-sponsored website: www.healthcare.gov– Texas opted out of offering a state-run Health Insurance

Marketplace.

The Affordable Care ActSummary

• The Health Insurance Marketplace (HIM) enables individuals and small employers with less than 50 employees to:– Compare plans and their premiums.– Determine available subsidies.– Purchase health insurance.

Health Insurance MarketplaceTimeline & Eligibility

Timeline• October 1, 2013: Open enrollment began.• January 1, 2014: Plan year starts for Marketplace

members.• March 31, 2014: Open enrollment ends (except for

qualifying events).

Marketplace Eligibility• Individuals

– Most may be those who are eligible for subsidies and/or who are concerned with tax penalties.

• Small employers (less than 50 employees).

Marketplace Plans Offered in Primary Service Area

Exclusive marketplace plans to Providence• BCBSTX• Humana/Lifesynch• Superior/Cenpatico• FirstCare• Aetna

Exclusive marketplace plans to S&W/Hillcrest• SWHP

Non-exclusive marketplace plans• Cigna – using existing provider network; both hospital

systems participating.

Tax Credits and Cost Sharing AssistanceFor Individuals

Premium Assistance Subsidy (Tax Credit)• Available for individuals with income between 133% to 400% of FPL

(sliding scale, from 2% to 9.5% of income limits – based on Silver plan)• Can be initially applied as the individual enrolls through the federal

insurance marketplace to help reduce premium costs; federal tax return will reconcile this premium assistance.

Cost Sharing Assistance• Available to individuals choosing the Silver plan only.• Reduces patient cost share amount:

• From 30% to 6% for FPL under 150%. • From 30% to 13% for FPL under 200%. • Little impact for other FPL levels.

Penalties

2014 • $95 adult• $47.50 child • or 1% of family income (greater; $285 family max)

2015• $325 adult• $162.50 child • or 2% of family income (greater; $975 family max)

2016• $695 adult• $347.50 child• or 2.5% of family income (greater; $2,085 family max)

Beyond 2016: Cost of living increases

Plan Types

All plans must cover “Essential Health Benefits” as determined by HHSC.

• Bronze: 40% Out of Pocket Costs• Silver: 30% Out of Pocket Costs• Gold: 20% Out of Pocket Costs• Platinum: 10% Out of Pocket Costs• Catastrophic: Available only for ages 30 and under.

Health Insurance MarketplaceFor Small Employers

• SHOP, Small Business Health Options Program, was implemented under ACA to assist Small Employers in purchasing health insurance for their employees.– Small Employers are not mandated to provide insurance to

their employees (no penalty) but the ACA provides an alternative to compare and shop plans.

– Must have at least one Full-Time Employee (FTE) to purchase; Self-Employed individuals with no employees must purchase insurance through the Individual Marketplace.

– Must offer the SHOP purchased insurance to all FTEs.– Plans start any time after January 1, 2014.

SHOP Advantages

• Tax credits are available to Small employers who purchase health insurance through SHOP.

• Employers can control the type of coverage for their employees and how much to contribute to their employee premiums.

• Similar to the Individual Marketplace, SHOP provides a easy way to compare similar plans.

• Coverage and Pricing protections from pre-existing conditions.

• Additional competition resulting in premium savings.

Small Employer Tax Credit

• The ACA provided tax credits to Small Employers from 2010 to 2013. These tax credits will increase in 2014.– Current maximum tax credit is 35% of premiums for small

employers and 25% for small tax-exempt employers.– In 2014, the maximum tax credit will increase to 50% of

premiums.• Tax Credit is computed on a sliding scale; smaller

employers with lower wage earners receive the most tax credit.

Small Employer Tax Credit Eligibility

• To qualify for the tax credit, an Employer must:– Have fewer than 25 FTEs. – Cover at least 50% of the cost of single coverage

for each FTE (excludes dependents and P/T).– Covered employees must have average wages of

less than $50k per year.– Purchase insurance through the SHOP

Marketplace.

Small Employer Tax Credit Information

Tax credits are administered by the IRS. There are additional rules and forms to complete to access the small employer tax credits.

Additional information can be found on the IRS website, www.irs.gov

Health Insurance Marketplace Key Updates

Texas decided not to expand Medicaid.• As a result, the ACA extends subsidies to individuals at 100%

of the FPL (from the original 133% of FPL).• Those left out: Individuals who earn higher than current

Texas Medicaid eligibility criteria but below 100% of FPL will not receive subsidy in the HIM, nor qualify for Medicaid.

• Increases the possibility of eligibility “churn.”

Feds delayed the large employer (50 or more employees) mandate to provide health insurance to their employees until 2015.

Health Insurance Marketplace Education

Providing Health Insurance Marketplace education to patients, physicians, small employers and the Greater Waco community will potentially increase Central Texas’ insured population.

Results• Healthier community.• Increased financial stability for individuals.• Supports small employers in retaining health insurance for their

employees.• Aligns with Providence’s mission to serve the sick, poor and

vulnerable.

Providence Health Insurance Marketplace Education Campaign

• An Education Center is located in Providence’s main lobby.– Free public service advertised through print, outdoor, etc.

• Educational collateral material will be distributed: – Access points throughout Providence Healthcare Network.– Direct mail.– Outreach opportunities (health fairs, seminars, meetings, etc.)

• Provide Online Education– www.Providence.net– Use Social Media to steer public to our website and Providence’s

Education Center for more information.• Potential collaboration with:

– Family Health Center – Health Plans– Local churches, non-profit organizations, etc.

Thank you!