What is a State Health Insurance Exchange?
The Health Care Reform Act required each state to set up an online medical insurance exchange where residents of each state 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. These exchanges are scheduled to open October 1, 2013 for coverage beginning January 1, 2014. The only exchange available for residents of Oklahoma will be through the Federal Government. If you live in a state that offers a state exchange, you will have the option of going to that STATE exchange.
The federal government recently delayed the “employer mandate” feature of the ACA. Does this affect either UCO’s coverage or the health insurance exchange?
No. The employer mandate will require companies over a certain size to provide medical coverage to employees or pay a penalty. The delay simple gives these companies more time to get ready to comply with the employer mandate. UCO already provides benefits to eligible employees, so the delay does not change anything about UCO’s medical coverage. Nor does it affect the arrival of the insurance marketplaces, which still required to be open by October 1, 2013.
How will the Affordable Care Act change things for me?
You will be required to have a minimum level of medical coverage for you and your tax dependents in 2014 or pay a federal tax penalty. This is referred to as the “individual mandate” under ACA. You have the option to buy medical insurance from your state’s marketplace. However, although federal tax credits may be available to low eth cost of marketplace coverage, most UCO employees not be eligible for a federal tax credit because they have access to affordable medical coverage from UCO. If you are eligible for UCO’s medical coverage, depending on the coverage you choose, UCO’s medical coverage may be more comprehensive and less expensive for the level of coverage.
How much is the tax penalty if I don’t have medical coverage for 2014?
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 tax is expected to be $2.00 per person per month. The reinsurance fee for the ACA is an additional $5.25 per month. These fees have already been included in your monthly premium.
In addition, when you file your 2014 income tax you will be subject to a new tax, if someone on your return is not covered by medical insurance. It will be the greater of a $95 per person fee or 1% of your income. The rate increases in 2015 to $325 per person or 2% of your income and by 2016 the rate is projected to $695 per person or 2.5% of your income. The ACA tax on all medical plans will be used to fund the medical exchange and future medical research.
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 easier to compare coverage from different plans. You will be able to use the information on the website and in hand-outs provided during Open Enrollment to compare UCO’s plans benefits and rates with plans offered on 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 will include plans that cover as much as 90% and as little 60% 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. We won’t know for sure until after October 1, when all marketplaces publish their plan features and rates. However, keep in mind that UCO subsides 100% 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.
What does the arrival of the marketplace really mean to me?
Probably, not much. For 2014, if you are eligible for medical coverage through the UCO medical plan, you can participate in the medical plan just like any other year. If you decide to enroll in one of the marketplace plans, be aware that you won’t be eligible for federal subsidy, and unless you have a Family Status Change, you won’t be able to re-enroll in the UCO plan until 2015, if you remain eligible. If you are not eligible for medical coverage through UCO, you will want to enroll in other medical coverage for 2014 to avoid the federal tax penalty. You can enroll through a family member’s employer plan or through your state’s marketplace. Before you decide, visit the marketplace to determine if you are eligible for a federal tax credit.
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.