Believe it or not, open enrollment is upon us. If you don’t know what that means then you either have been living under a rock or you have your health insurance already taken care of. Which brings up a good point that needs to be stressed, if you already have health insurance coverage and you are happy with it, you do not need to do anything? The number one reason that health care reform was started in the first place was to help the uninsured get coverage. There are a number of reasons why someone might not have health insurance. They are uninsurable due to a health reason, they do not have it available through their job, they cannot afford it, or they simply don’t think they need it or refuse to buy the coverage. There is not a lot that can be done about the last two reasons. But health care reform should help the first two.
Starting with effective dates of Jan 1st 2014, insurance companies can no longer turn anyone away because of health problems or pre existing conditions. Through the exchanges, individuals can apply for subsidies based on their income. And while the subsidies are somewhat generous, if you have insurance at work that is considered affordable and provides minimum value then you cannot receive a subsidy from the exchange or marketplace. They have started calling them Insurance Marketplaces to better reflect what their function is.
Insurance at work is considered affordable if the amount of premium that the employee pays does not exceed 9.5% of the household income. Insurance coverage is considered to be of minimum value as long as it has 60% actuarial value. Which is a fancy way of saying that, on average, the insurance will pay 60% of any claim filed. Most group insurance policies far exceed that threshold. To compare it to the metals plans in the marketplace, the bronze level is considered to have 60% actuarial value. The metals plans are Platinum, Gold, Silver and Bronze, in order of value. So as you can see the bronze level is the lowest level of value on that scale. Most group medical policies are more along the lines of gold or silver with a few platinum value plans still out there.
A few thoughts about the new marketplaces; when this article runs, the marketplaces will have been up and running for a few days. I am writing this on Oct 1st which is the debut of the marketplace websites. So far today, either an error message appears once you get a to a certain point or the system crashes and says to try back later. At best, it is taking an extended period of time to navigate the system. This was somewhat anticipated and hopefully it will get better as time goes along. But something to remember is that the earlier effective dates available at this time are Jan 1st anyway.
Again, it needs to be stressed that if you have affordable, minimum value coverage at work, you will not be eligible for any subsidies on the marketplace. Add to that, you would lose any contribution that your employer makes to the cost of your coverage now. So if you are happy with your current plan, whether you get if from work or not, you don’t need to make any changes or do anything different than you have in the past.
This information is provided by Mark E. VonMoss, Manager Financial Service Div. of The Insurancenter.