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Q&A: The Affordable Care Act/Healthcare Marketplaces

What Young People Need to Know about the Affordable Care Act

 Disclaimer:  The Patient Protection and Affordable Care Act and its accompanying regulations are a complex systems designed to improve the quality and access of healthcare in America.  This document is designed to answer basic questions but each case is unique.

 THE BASICS

What is the Patient Protection and Affordable Care Act?

The Patient Protection and Affordable Care Act has completely overhauled the insurance system in America and thereby saved money for Americans while ensuring increased coverage for all.

Is the Affordable Care Act still the law?

Yes, the Affordable Care Act is still law. The Supreme Court ruled that the law was Constitutional and will be fully implemented starting January 1st, 2014.

Does the Affordable Care Act mean that I need to purchase insurance?

Yes, it is necessary that everyone purchase insurance under the Affordable Care Act to prevent undo burden on fellow taxpayers, the medical system and personal long-term debt.  There are some individuals that are except from the program. See Kaiser Family Foundation’s chart to see if you can obtain an exception.

Why should I purchase healthcare coverage?

Even if you are health, you want to purchase health insurance because anything could happen.  No plans to develop a chronic disease, get hit by a bus or break an ankle playing softball.  Healthcare is expensive and treating one of these conditions could easily cost thousands of dollars.  Healthcare costs are the biggest cause of bankruptcy in America.

The Department of Health and Human Services has come up with a video explaining why purchasing health insurance is a good idea.

What do I get from the insurance?

The law enumerates ten essential benefits that all plans must offer:

  • ambulatory patient services
  • emergency services
  • hospitalization
  • maternity and newborn care
  • mental health and substance abuse services (including behavioral treatment)
  • prescriptions
  • rehabilitative and habiliative services and devices
  • laboratory tests
  • prevention and wellness services (including chronic disease management)
  • pediatric services (including dental and vision)

Can I not get insurance?

Technically, all American need to purchase insurance unless:

  • You do not file an income tax return, meaning you make less than $10,000/year for an individual or $20,000/year for a family,
  • You are in prison
  • If you’d have to pay more than 8 percent of your income after taking into account an employer contribution or tax credit,
  • You are a member of an Indian tribe,
  • You are an undocumented immigrant,
  • You received Medicare, Medicaid or Tri-Care benefits, or
  • You are part of a religious group opposed to acceptance health insurance

If you do not purchase insurance, it will result in a fine. In 2014, the fine will be $95/adult and $47.50/ child up to $285/family OR 1 percent of family income, whatever is greater. In 2015, the fine will be $325/adult and $162.50/child up to $975/family OR 2 percent of family income, whichever is greater.  In 2016, the fine will climb to $695/adult and $347.50/child up to $2,085/family OR 2.5 percent of family income, whichever is greater.

I heard something about a catastrophic plan?

Yes, catastrophic plans are only for people under 30 and some older people with limited incomes. The plans are designed to protect purchasers from very high medical costs such as a car accident.  The plan required that purchasers pay ALL medical and healthcare cost up to a specific dollar amount then the insurances covers the rest; the dollar amount is often several thousand dollars.

Catastrophic plans purchased through the marketplace will include three primary care visits per year at no cost.

DEFINITIONS

What is a premium?

Is the cost of your health insurance plan, generally payed monthly, quarterly or yearly.

What is a co-pay?

A co-pay is a fee that you pay when you receive a healthcare service, like $15, such as visiting the doctor or hospital.  The cost of co-pays varies with each insurance plan.

What is a deductible?

Just like car insurance, it is the amount you have to pay before your coverage kicks in and pays the rest. Deductibles vary with each insurance plan.

HEALTH CARE MARKETPLACES

What is the healthcare marketplace?

The healthcare marketplaces are locations at which individuals can purchase healthcare coverage from private companies.

Where can I purchase insurance through the marketplace?

Marketplace insurance can be purchased online, in-person or via the mail.  Each state has a separate marketplace.

What type of insurance is available?

All insurance sold on the marketplace has the same level of essential benefits.  The plans then range from bronze, the lowest premium and highest out-of-pocket costs, to platinum, the highest monthly premium and lowest out-of-pocket costs, and include gold and silver options.  These options DO NOT reflect the quality or amount of coverage BUT ONLY the monthly premium/out-of-pocket costs balance.

When do I get coverage and when can I buy it?

Open enrollment runs October 1, 2013 until March 31, 2014; coverage will begin on January 1, 2014.  Open enrollment will not open again until October 2014.

How do the marketplaces work?

When you enter the marketplace, you will be asked to fill out an application concerning your income, size of household and location. The system will also tell you if you are eligible for Medicaid or CHIP.

Will I save money?

The Marketplaces are designed to reduce the risk for insurance company and thereby save customers money.

There are additionally provisions that reduce costs for customers purchasing the “Silver” level plans. If you are an individual with a household income under $28,725, you are eligible for additional cost savings and the application on the marketplace will alert you to this fact.  The household income level increases by $10,050 for each individual up to 8 members of the household.

PARENT PLANS FOR PEOPLE UNDER 26

What is this that I hear about 26 and parent’s healthcare plan?

Healthcare plans that offer dependent coverage are required to offer coverage of dependents until the dependent reaches the age of 26 unless the dependent has another offer of employer-based healthcare coverage.  Starting in 2014, the rules will change and plans will be required to offer dependent coverage until 26 regardless of other healthcare coverage offers.

However, not all plan offer dependent coverage nor are they required to offer it.

What if I’m married?

The above options are available to married and unmarried adults under the age of 26.

What if I have children?

Healthcare insurance companies are not required to offer coverage to dependents of dependents under the new law.

Can I cycle on and off of my parent’s healthcare insurance if I do not have regular employment?

Unfortunately, no; once you come off the dependent coverage for an employer-provided plan, you cannot be covered under your parent’s dependent coverage.

PRESCRIPTIONS

What about prescriptions?

The Affordable Care Act requires that all healthcare insurance plans contain pharmacy benefits. If you do not have prescription drug coverage, it will be added to your plan.

Additionally, the annual cost limits for out-of-pocket expenses will include prescription drugs. These limits are now $6,350 for individuals and $12,700 for families.

What prescriptions are covered?

The Affordable Care Act required that plans sold through the marketplaces provide cover for all least one drug in every category and class.  This means that if you need a specific type of medicine for a heart condition, the plan is required to cover at least one prescription that follows under that type.

For more information on prescription cover, see WebMD’s interview with Joel Owerbach, Pharm.D.

REPRODUCTIVE HEALTH

Are plans now required to cover birth control for females?

Yes, plans are required to provide coverage for birth control methods are FDA-approved and prescribed by a doctor including barrier methods, hormonal methods, emergency contraception and implanted devices.  There are also required to cover sterilization procedures and patient education and counseling.

Are plans required to cover abortion services?

No, the Affordable Care Act does not required health insurers to cover drugs that induce abortion.

Are the required to cover male sterilization procedures?

No, coverage for vasectomies and other male sterilization procedures are not required under the Affordable Care Act; however, some plans more provide coverage.

What if I’m pregnant?

Until January 1st, 2014, CHIP and Medicaid are available for expecting mothers since insurers may charge a higher premium or reject pregnant women.

Once the law is fully implemented, plans cannot reject pregnant women. Additionally, many states are expanded Medicaid program to higher income individuals/families.

MISCELLANEOUS

What about dental?

There is no mandate for dental coverage, however, it is considered an essential benefit to children under the age of 18 and must be offered as part of your healthcare plan or as a stand-alone plan.

What about vision?

There is no mandate for vision coverage but some marketplaces may offer vision coverage in plans.

What is this pre-existing coverage business?

Thanks for the President’s Affordable Care Act, people with pre-existing coverage cannot be denied insurance coverage.  There is one exception, if you had previously purchased an individual plan, it may not cover your pre-existing condition but if you purchase a new plan, it will cover those expenses.