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March 31st Madness Has Come and Gone: Now What? PDF Print E-mail
Written by Ellen Breslow   
Tuesday, 01 April 2014 00:00
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March 31st, Obamacare, ACA, healthcare.gov........open enrollment is over. Well, at least for those who don't meet the exception qualifications. The dust has settled. But has it really? How many individuals are newly insured through the exchanges? Newly insured through employers? Still uninsured? Can they even be accurately counted?

Early returns would indicate that more than 6 million individuals have enrolled in the health insurance exchanges. But these returns are estimates. Although this number may appear to be accurate, it is almost impossible to know how many of these 6 million people are fully enrolled AND have paid premiums. Final numbers may come in mid-April, but they probably won't be accurate either as not everyone in that tally will have paid their first premium. These individuals can't be considered covered until they do. This count will also not include individuals who have signed up through non government sites, through insurers, or are part of the "exception" group and encountered problems when trying to enroll.

The ACA was designed to significantly reduce the 48 million people uninsured nationally. One of the most important numbers that is not yet available is by how much the new health care options have actually decreased the number of uninsured people. The data that has been published does not differentiate between enrollees who were previously uninsured and those who moved coverage to a policy purchased through an exchange but had been insured elsewhere. Individuals who may have declined employer sponsored health insurance in the past, but have elected to enroll now would also not be included in this enrollment count.

There has been much media attention given to the youth demographic: individuals ages 18-34. , Many of the recent enrollment numbers indicate that approximately 25% of the new enrollees are in this group. Of course, this is a key part of the population to attract as they are most often the healthiest segment. These numbers are also difficult to validate as well.

One of the most critical components of these enrollment totals is the impact by state. Health insurance is regulated state by state so that the individual state demographic can affect the cost going forward.  Carriers don't yet know the ultimate impact of Obamacare enrollment on individual states and will most likely not release 2015 premium costs until close to open enrollment time. With so many unanswered questions, it is hard to imagine that premiums will remain the same.

As has been the case with most aspects health care reform.....we'll see.

For additional information, contact EAB HealthWorks.


Last Updated on Tuesday, 01 April 2014 05:53
Affordable Care Act Penalty Tax: Yes, No, Maybe? PDF Print E-mail
Written by Ellen Breslow   
Thursday, 20 March 2014 06:00
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If an individual or family decides to forego health insurance, is there a penalty tax? What is the exact figure? It seems that computing this tax may be a bit more complicated than has been portrayed in many publications. Who precisely is subject to this tax and when is it assessed?

The Obamacare individual mandate requires that most Americans obtain health insurance by 2014 or pay a penalty. The individual mandate was effective January 1, 2014. The penalty tax will be applied to year end modified adjusted gross income for each month that an individual had no health insurance nor an exemption to it. To avoid the penalty, individuals will have to enroll in a marketplace plan no later than March 31, 2014. Missing the deadline will trigger a fee and open enrollment won't begin again until November 15, 2014.

What constitutes an "exemption"? Good question. Can anyone get one? First, and most important, most individuals are offered health insurance through their employers. For an exemption to apply to anyone whose employer offers coverage, the individual would have to pay more than 8% of income for that health insurance coverage after taking into account any employer contributions OR tax credits that may be available through an exchange purchased plan. Also, individuals are allowed a short coverage gap of three consecutive months and will be exempt from the tax for these months. In 2014, a second exemption covers those who buy marketplace insurance for an additional month. An exemption is also granted for anyone who is part of a religious group opposed to acceptance of benefits from a health insurance policy. There is no penalty for undocumented immigrants and members of Indian tribes who don't enroll in exchange plans.

These are broad categories; there are other conditions that would permit an individual to apply for an exemption. These include, but are not limited to, homeless individuals, homeowners who are in a home foreclosure situation,  a death in a family and anybody who believes they have had a hardship in obtaining health insurance. Documentation is optional. And, of course, there are the policy holders whose coverage was canceled; that group has just been given another two year extension. It would seem that almost anyone could fall into one of these categories!

Now....the penalty tax. In 2014, the tax is $95 per adult and $47.50 per child under age 18 (up to $285 per family) or 1% of income, whichever is greater. For 2015, the penalty is increased to $325 per adult and $162.50 per child under age 18 (up to $975 per family) or 2% of family income, whichever is greater. And, in 2016, the penalty is $695 per adult and $347.50 per child under age 18 (up to $2,085 per family) or 2.5% of family income, whichever is greater. The penalty cannot exceed the national average premium for a bronze plan coverage in an exchange. After 2016, these penalties can be increased annually by a cost of living adjustment.

The ACA imposed this penalty tax to help defray the cost of maintaining the exchanges. How much will be collected remains to be seen. Between the sheer number of possible exemptions and the confusing manner by which these taxes will be assessed, it seems as if accurately determining tax revenue is unlikely. It remains to be seen.

For additional information, contact EAB HealthWorks.


Last Updated on Thursday, 20 March 2014 06:44
Can You Reduce Your Health Coverage Out of Pocket Expenses? PDF Print E-mail
Written by Ellen Breslow   
Tuesday, 11 February 2014 00:00
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As out-of-pocket costs increase and consumer driven health plans become more prevalent, individual health insurance costs are more than just premiums. Is there such a thing as supplemental insurance from an employer or an exchange plan that would cover additional non premium expenses that individuals incur while owning health insurance?

It is widely recognized that the Affordable Care Act (ACA) requires almost everyone to obtain health insurance and that more than 80% of working individuals are covered by an employer sponsored plan. Even with coverage, however, deductibles copayments and coinsurance continue to rise as employer try to control their own costs. According to a Kaiser Family Foundation study, the average annual deductible in 2013 was $1135. And, in 2014, a high deductible health plan will have an individual or family deductible of not less than $1,250 or $2,500 respectively. Next comes the out-of-pocket expenses: not to exceed $6,350 for individuals or $12,700 for families. That is before insurance will pay for what the plan dictates is covered and appropriate.

Enter fixed indemnity coverage also known as supplemental insurance. Although this type of coverage has been available for some time, it seemed as if the market for it would have declined as more people purchased health insurance. Indemnity coverage is separate and does not replace, but is obtainable in addition to health insurance. Typically, this would be an employer sponsored benefit that may be offered to complement a health insurance plan.

The idea behind this supplemental coverage is to help individuals manage health expenses before insurance or in addition to what insurance pays. The cost for this type of coverage depends upon an individual's age and how much coverage is purchased. It would appear that such additional insurance could be instrumental in managing out-of-pocket expenses.

But not exactly. Fixed indemnity coverage is similar to catastrophic plans in that it most often doesn't cover routine deductible or out-of-pocket expenses. It is the diagnosis of a critical illness or hospitalization for cancer or accidents that is covered, but not necessarily both. Fixed indemnity plans are very specific in what they cover and payments will be activated based on what  is not covered by another policy.

Expect to see a lot more about supplemental insurance in the months to come, most often at the workplace. It's critical, however, that individuals evaluate supplemental policies with a keen eye toward their cost and the potential use of their benefit.

For additional information, contact EAB HealthWorks.


Last Updated on Wednesday, 19 March 2014 19:32
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