Affordable Care Act
What is a State Health Insurance Exchange?
The Affordable Care Act requires each state to set up an online medical insurance exchange where residents of can buy medical insurance directly from insurance companies. The federal government will run the exchanges in states that chose NOT to set up an insurance exchange. The only exchange available for residents of Oklahoma is through the Federal Government. If you live in a state that offers a state exchange, you have the option of going to that STATE exchange.
The federal government delayed the “employer mandate” feature of the ACA. Does this affect either UCO’s coverage or the health insurance exchange?
No. The employer mandate requires companies over a certain size to provide medical coverage to employees or pay a penalty. The delay simply gives these companies more time to comply with the mandate. UCO already provides benefits to eligible employees, so the delay does not change anything about UCO’s medical coverage.
How has the Affordable Care Act changed things for me?
You are now required to have a minimum level of medical coverage for you and your tax dependents. If you, your spouse or other tax dependents don’t have health insurance that qualifies as minimum essential coverage you are subject to a federal tax penalty. You pay the penalty for any month that you were’t covered. You have the option to buy medical insurance from your state’s marketplace however, most UCO employees are not eligible for a federal tax credit because they have access to affordable medical coverage from the University.
As a result of the ACA, a tax will be levied on all medical plans to fund the Patient Center Outcomes Research Institute (PCORI). This 2015 tax is $2.08 per person per month. The reinsurance fee for the ACA is an additional $2.25 per month. These fees have already been included in your monthly premium. The ACA tax on all medical plans will be used to fund the medical exchange and future medical research.
How much is the tax penalty if I don’t have medical coverage for 2015?
If you or your dependents did not have minimum essential coverage for any month during 2015, you will pay the federal tax penalty at the time that you file your 2015 income taxes. The penalty is the greater of two percent of your income or $325. In 2016, the penalty increases to the greater of two and one half percent of your income or $695. The penalty may be pro-rated for short-term lapses in coverage.
Are there any new changes in 2016?
Yes, 2016 is the first year that UCO employees will receive a 1095 from the University. This form, which is also sent to the Internal Revenue Service (IRS), provides a record for each of the months during the previous year that you were eligible for coverage through your employer and each of the months during the previous year that you and your dependents were covered under your employer’s plan. The 1095 also shows the cheapest monthly premium that an employee could have paid. Much like your W-2, the 1095 will be mailed to your home and be sent in January of each year. The IRS will use the information on the 1095 to determine coverage and penalties for lapses in coverage.
Will I be able to compare UCO’s coverage with the coverage on the marketplace?
Yes. All medical plans are required to provide plan details in a simple, plain English format that makes it easy to compare coverage from different plans. You can use the information on our BenefitFocus page, UCO’s website or in hand-outs provided during Open Enrollment to compare UCO’s plans benefits and rates with plans offered in your state’s marketplace.
Won’t the federal government subsidize marketplace insurance?
Yes. The federal government will provide a subsidy in the form of a tax credit based on a sliding scale of household income and dependents. However, even if your household income falls within the subsidy range, you and your dependents will not be eligible for the federal tax credit if you are eligible for UCO’s medical coverage, since UCO offers an affordable option, as defined by the ACA, for employee-only coverage.
Will marketplace medical insurance cost less than UCO’s medical coverage?
The marketplace includes plans that cover as much as 90 percent and as little 60 percent of eligible expenses. Also, networks, doctors and hospitals may be different from one plan or region to another. As a result, some marketplace plans may be less expensive than UCO’s plan options. However, keep in mind that UCO subsides up to 100 percent of the employee portion of the medical insurance for eligible employees. Because UCO’s employee-only coverage is affordable under the ACA, you will not be eligible for the federal tax credit even if your family income meets the subsidy criteria, and even if the federal subsidy is greater than UCO’s subsidy.
Where can I learn more now?
Go to www.healthcare.gov. From there you can explore your state’s marketplace if it’s already online. You can also sign up for text and email as updates from your state’s marketplace becomes available.