Its a new world!

Health Care Changes and You

Todays Agenda
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MHC Who we are Understanding the Problem Understanding the Affordable Care Act Understanding Insurance Exchanges Moving Forward

Montana Health CO-OP: Who We Are

Who is MHC?
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Member-owned health CO-OP Non-profit organization Home-grown (Helena-based) Funded via federal start-up loans CO-OPs currently approved in 24 states Offering products via the Health Insurance Exchange

Health Care: Understanding the Problem

Health Care Problems

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Insurance Situation
50 million uninsured Americans 200,000 uninsured Montanans Premiums double in last 10 years 62% of all bankruptcies medically-related

Health Care Problems

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Insurance Situation
Coverage isnt comprehensive Affordability Emphasis on group/employer-provided insurance. Pre-existing condition clause Fear of losing coverage with job loss/change Insurance denied if no continuity of coverage

Health Insurance Exchanges & the ACA

Health Insurance Exchanges

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Exchange = Marketplace Internet-based marketplaces to shop for and buy health insurance Compare apples to apples (tiers of coverage) Determine eligibility for premium subsidies Plans on the exchange must offer Essential Health Benefits 278,000 Montanans could get insurance via the Exchange Congress and their staff will get insurance from the Exchange

Health Insurance Exchanges

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How Does the Marketplace Work?

Carrier 3 Carrier 2

Qualified Entity

Agents
Direct Access

Enter applicant info Navigator Carrier 1

Determine eligibility/tax credit level

Calculate and display plans w/tax credit

Select plan/ premium

Individual Assisted

Carrier enrolls member Carrier collects premium

Montana Health Marketplace

Eligibility and tax credit validation Tax credit payments Approved tax credit

Health Plans

Auto enroll all eligible for Medicaid/CHIP Eligibility data

Individual Contribution

HSA Vendor
Process Flow Money Flow Data Flow

Health Insurance Exchanges

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Gold
Metallic Plans

Silver

Bronze

1
22

1
2

1
2

Solutions
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Open Enrollment/Guaranteed Coverage

Gold
$600 Deductible 80/20 (1,500 out-of-pocket)

Silver
$1,200 Deductible 70/30 (3,000 out-of-pocket)

Bronze
$2,000 Deductible 50/50 (3,750 out-of-pocket)

Subsidies available via exchange

2014: Subsidies At Work

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Projected Income Unsubsidized annual health insurance premium (adjusted for age) Maximum % of income the person/family must pay for premium (based on income % of poverty level) Amount person/family pays

$34,516
(300% of poverty level)

$7,500

9.50%

$3,279

Government tax credit/subsidy

$4,221

*Must purchase from the Exchange/Marketplace to receive subsidy.

2014: Subsidies At Work

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Projected Income Unsubsidized annual health insurance premium (adjusted for age) Maximum % of income the person/family must pay for premium (based on income % of poverty level) Amount person/family pays

$16,107
(140% of poverty level)

$7,500

3.41%

$550

Government tax credit/subsidy

$6,950

*Must purchase from the Exchange/Marketplace to receive subsidy.

Health Insurance Exchanges

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Up and running by October 2013 Open Enrollment period for purchasing insurance on the exchange: October 2013 January 2014 Montana will use the Federal Health Insurance Exchange Montana Health CO-OP plans will be on the exchange

Understanding the Affordable Care Act (ACA)

Affordable Care Act (ACA)

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Signed into law March 2010

Expand Medicaid Encourage employers to offer health insurance. Provide premium subsidies Establish health insurance exchanges Strengthen consumer protections Impose protections to guard against unreasonable rate increases. Encourage primary and preventive care. Mandate insurance for everyone.

Affordable Care Act (ACA)

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Insurance companies cannot:

Put a lifetime cap on how much they will pay Cancel coverage by finding a paperwork error. Deny coverage based on pre-existing conditions Charge women more for coverage

Affordable Care Act (ACA)

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Making Health Care Affordable

Preventative services are free Cancer screenings: mammograms & colonoscopies Vaccinations: flu, mumps & measles Blood pressure and cholesterol screenings Tobacco cessation counseling Depression screening And more

Affordable Care Act (ACA)

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Making Health Care Affordable

The 80/20 Rule

Beforeinsurance companies spent as much as 40 cents of every premium dollar on overhead, marketing and salaries. Nowthey must spend 80 cents of your premium dollar on your health care or on improvements to care. If they dont, they must repay the money.

Affordable Care Act (ACA)

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Making Health Care Affordable

Starting in 2014

Cannot deny coverage for pre-existing conditions Insurance exchanges allow you to easily compare plans Subsidies for qualified individuals to make premiums affordable New small business tax credits

ACA Subsidies
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For qualifying individuals and families without employer-based insurance

Starting in 2014

Subsidies (advanceable tax credits) to offset monthly premiums for those with income between 100-400% of the Federal Poverty Level (FPL). 65% of Montana families have incomes below 340% of the FPL.

Subsidies At Work
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2012 Annual Guidelines Federal Poverty Level

Family Size 1 2 3 4 5 6

100% $11,170 $15,130 $19,090 $23,050 $27,010 $30,970

133% $14,856 $20,122 $25,389 $30,656 $35,923 $41,190

150% $16,755 $22,695 $28,635 $34,575 $40,515 $46,455

185% $20,664 $27,990 $35,316 $42,642 $49,968 $57,294

200% $22,340 $30,260 $38,180 $46,100 $54,020 $61,940

250% $27,925 $37,825 $47,725 $57,625 $67,525 $77,425

300% $33,510 $45,390 $57,270 $69,150 $81,030 $92,910

400% $44,680 $60,520 $76,360 $92,200 $108,040 123,880

ACA Subsidies
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Subsides will ensure qualifying households pay no more than a specific percentage of income on premiums: Percentage of household income is a sliding scale based on the Federal poverty level (FPL) of the family involved:

Up to 133% FPL: 2.0% of income 133-150% FPL: 3.0% 4.0% of income 150-200% FPL: 4.0% 6.3% of income 200-250% FPL: 6.3% 8.05% of income 250-300% FPL: 8.05% 9.5% of income 300-400% FPL: Capped to 9.5% of income

Source: (PPACA 1401, 10105; HCERA 1001; IRC 36B)

2014: Subsidies At Work

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2014: Changes for Employers

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Businesses with less than 50 full-time employees are exempt from having to offer health insurance to workers.

97% of Montana business have fewer than 50 fulltime employees. 80% of Montana employers have fewer than 10 workers.

2014: Changes for Employers

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Small employers offering health insurance

with 25 or fewer full-time employees that have average wages under $50K

are eligible for small business tax credit of 35 percent (increasing to 50% by 2014).

2014: Changes for Employers

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Penalties for large companies (50+ workers):

Not offering minimum essential benefit coverage -$2,000 per full-time worker (subtracts first 30 full-time workers) Not offering affordable coverage lesser of $3,000 per full-time employee receiving a subsidy or $2,000 per fulltime employee

Penalties for the Uninsured

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2015: Insurers mail a Notice of Insurance (similar to W-2) for taxes.

Income too low to file a federal tax return? Penalties are not meant for you. 2014 $95 per adult and $47.50 per child, up to a family maximum of $285 or 1 percent of family income, whichever is greater

Moving Forward

Making the New Laws Work for Montana

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Stay informed: Will the MT legislature approve federally-funded Medicaid expansion? Will other insurers participate on the exchange? Consider the paradigm shift from group coverage to individual coverage. Do we have ample primary care physicians? Expect a dramatic change in the health care market. Anticipate the possibility of an insurance shift (354,000 Montanans may see an insurance change). Know that there will be fine-tuning and clarification of the ACA. See: www.healthcare.gov

Thank you!
Karen Murphy kmurphy@mhc.coop