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How Has the Affordable Care Act Changed Your Healthcare?

If you’re one of the lucky Obamacare “survivors,” you might not be aware of all the changes that this new law has imposed on others. People who have m...
Tuesday, 15 July 2014

colorado-health-insuranceIf you’re one of the lucky Obamacare “survivors,” you might not be aware of all the changes that this new law has imposed on others. People who have managed to maintain their original health plan since the enactment the Affordable Care Act became law might consider themselves lucky, or perhaps they haven’t noticed the subtle differences quite yet.

Where are we in “Obamacare history”?

Some provisions of the Affordable Care Act are already in force, like the fact that plans can no longer set lifetime limits on coverage, or how they must cover dependent children on their parents’ plan up to the age of 26. As of January 1, 2014, a broader set of changes was implemented which will have a more profound effect on Americans. One of these is the introduction of health care exchanges.

In addition to plans that offer state-based health insurance, individuals and families will have more options under the Arizona Health Insurance Exchange. For example, small businesses will have options now and larger employers will be able to participate in 2017. The benefit of a health insurance exchange is that it allows consumers to compare quotes with the plans offered through various state-based health insurance programs.

How is health insurance purchased in 2014?

The state-based health insurance exchanges offer four plans – Bronze, Silver, Gold and Platinum – which cover anywhere from 60% to 90% of medical expenses. Coverage details and cost will vary from one plan to another, but within a state each plan “class” must be consistent among health insurance companies.

For those who already have coverage through an individual plan or through an employer, you will be able to retain coverage with those plans or shop for coverage in the Exchange.Those who don’t have current coverage are now eligible to obtain coverage three different ways: a) purchase coverage through the Exchange, with or without help from a government subsidy, b) obtain coverage through Medicaid (must meet low income qualifications), or c) purchase private coverage outside of the Exchange.

What happens if I don’t buy health insurance?

As specified under the “individual mandate” provision of the law, individuals who choose not to participate by purchasing health insurance will pay a penalty. This year, the penalty will be $95 or 1% of taxable income, whichever is greater. However, each year this penalty will get steeper. In 2015 it goes up to $325 or 2%; in 2016 it will be $695 or 3%; with annual adjustments in 2017 and thereafter.

Business owners must follow new rules

Recent regulations in the healthcare law have had a measurable impact on business owners and how they offer health insurance to employees.
Each employer must now provide workers with a “Summary of Benefits and Coverage” (SBC), which provides information about the plan benefits and coverage in an easy-to-read format. Additionally, employers must provide employees with a written notice about the existence of exchanges and the services they provide; how to qualify for a tax credit on their health insurance premiums; and the financial risk they might take if they were to lose employer contributions toward the cost of coverage.

Starting in 2014, the employer mandate provision started requiring businesses with at least 50 employees to pay a penalty of $2,000 per employee if they do not offer them “affordable” coverage.” There is a waiver for the first thirty employees, but a penalty would apply to the remainder of the full-time workforce.

Most individuals and business owners still have questions about healthcare and how to make informed decisions in this new world of “Obamacare”. The amount of paperwork and regulations coming out of Washington has been described by some as an “avalanche,” so it is no surprise that the average consumer is confused. If you are looking for advice in purchasing health insurance under the new laws, consult with an experienced Arizona health insurance broker.

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