The Affordable Care Act:Overview of Coverage

ProvisionsDance/USA

2014 Dance ForumNew York, NY

January 10, 2014

Sarah J. Dash, MPHGeorgetown University Health Policy Institute

Center on Health Insurance Reforms

About the Georgetown University Center on Health Insurance ReformsResearch and analysis of private health insurance marketsMonitoring of state and federal health insurance market regulationAnalyze impact on affordability, adequacy, and availability of coverageProjects generously funded by The Commonwealth Fund, Robert Wood Johnson Foundation, and others.

Presentation OverviewHealth Insurance 101The Affordable Care Act (ACA)

Why was it needed and what does it do?

How the ACA Expands CoverageMarketplaces (individuals and small businesses)Medicaid

Implementation So FarWhat You Can Do NowQ&A

Health Insurance 101

Health Insurance 101: Where people get their coverage

Employer-sponsored coverageMedicaidUninsuredNongroup

56%21%

18%

6%

266.4 Million Non-elderly

Source: Kaiser Family Foundation

U.S.: Sources of Coverage for Non-elderly (2011)

2003 2010 2003 2010 2003 20100

25

50

75

100

6661

8580

95 94

5849

7671

90 88

4233

56 55

73 71

Employer offers Employee eligible Covered by own employer

Health Insurance 101: Fewer Small Businesses Offering Coverage, 2003–2010

^ Workers include both part-time and full-time workers who are not self-employed.Source: The Commonwealth Fund Biennial Health Insurance Surveys (2003 and 2010).

Percent of working adults^ ages 19–64

Small firms(<50 employees)

Large firms(>100 employees)

Midsize firms(50–99 employees)

In the Spotlight:

Health Insurance for Individuals and Small

Businesses

Why the Affordable Care Act?

Why the Affordable Care Act?

Why the Affordable Care Act? (Dysfunctional Insurance Markets)

Access Problems– Coverage denied due to pre-existing conditions– Rescissions (retroactive policy cancellations)

Affordability Problems– No employer or other subsidy– “Rate ups” for health status, gender, age

Adequacy Problems– Pre-existing condition exclusions– Critical benefits not covered– Out-of-pocket costs– Annual/lifetime limits on coverage

Why the Affordable Care Act? Everyone feeling the pain…

For individuals:– Barriers to care: prevention and treatment– Financial difficulties– “Job lock”– Personal anxiety, family stress

For businesses:– Skyrocketing health care costs crowd out higher

salaries or other business investments

For government:– Deficits, budget battles

Why the Affordable Care Act?Many Cooks in the Kitchen…

218 votes in the House60 votes in the Senate50 state legislatures, governors, insurance commissioners, and Medicaid directors (plus DC)17 (ish) directors of state-based Marketplaces3 federal agencies (HHS, DOL, IRS)

Plus… insurers, doctors, businesses, agents/brokers, consumer advocates, and other stakeholders….

The Affordable Care Act: How Does it Help Expand

Coverage?

Key ACA Coverage Provisions

Availability– New rules of the road for health insurance– Opens new doors for coverage

Affordability– More rules of the road for health insurance– Financial help with premiums and cost sharing

Adequacy– New standards for benefits and plan design

ACA Coverage Provisions: Availability

New rules of the road for health insurance:– Prohibits coverage denials/higher premiums based on health

status, gender, occupation

New Health Insurance Marketplaces– One stop shop for coverage, in every state)

Medicaid expansion – In some states

Other coverage provisions:– Enables dependents to stay on their parents’health plan

until age 26.

Critical Coverage Provisions: Affordability

More “Rules of the Road” for health insurance– Ends higher premiums based on health status– Ban on lifetime and annual dollar limits– Limits out-of-pocket costs– Insurers must spend at least 80% of premium revenue on health

care and quality improvements

Financial help for private insurance and Medicaid– Subsidies (premium tax credits) for individuals/families with low

to moderate incomes buy health insurance

Tax credits for small businesses that provide affordable coverage to their employees

Critical Coverage Provisions:Adequacy

Essential health benefitsPreventive services covered with no additional cost-sharing

NOTE: Health insurance plan choices may still vary based on factors such as cost sharing, networks,

and the extent of covered services!

Under Reform - 2019

Employer156 million

56%

Medicaid/CHIP48 million

17%

Nongroup & Other

27 million 10%

Private Exchanges23 million

8%

Uninsured26 million

9%

Employer161 million

58%

Medicaid/CHIP32 million

11%

Uninsured57 million

20%

Nongroup & Other

30 million 11%

Without Reform - 2019

280 Million U.S. Residents Under Age 65

What Does it Mean for Coverage?U.S. Coverage in 2019, With and Without the ACA

Source: Congressional Budget Office, March 2012 Estimate of the Effects of the Affordable Care Act on Health Insurance Coverage

What Else Does the ACA Do?

ACA: More than coverage reformsNot discussed today:– Delivery system reform– Quality improvement– Cost containment– Public health/prevention– Medicare

What Does the ACA not Do?

It doesn’t fix everything all at once for every person It’s not a “government takeover” – builds on current systemIt doesn’t make health insurance more fun (but it might make it easier)

Opening the Door to Health Insurance Coverage:Marketplaces and Medicaid

Health Insurance Marketplaces

Marketplace Basics

One-stop-shop for coverage– Individuals without other affordable coverage– Small businesses (SHOP marketplace)

Compare private insurance plans based on price, benefits, quality, and other features Most people will get a break on costs

Coverage Levels in Marketplace

40%

30%

20%

90%

80%

70%

60%

10%

0% 20% 40% 60% 80% 100%

% covered by plan % enrollee cost share

Platinum

Bronze

Gold

Silver

Additional “catastrophic” plan available to individuals under age 30 or if no other coverage is affordable

*All levels have essential health benefits

Who Is Eligible?

Marketplace SHOP

To buy coverage

U.S. citizen or legal residentNot incarcerated

Up to 50 full-time employees (up to 100 in 2016)Self/employed or sole proprietors go to individual marketplaceMust offer coverage to all full-time employees

For financial help

Income up to 400% of the poverty levelNot eligible for other “minimum essential coverage”

Tax credits up to 50% of employer’s costLess than 25 FTE employees, <$50K average wages, and employer pay 50% of premium

Types of Financial Assistance:(Individual Marketplace)

Premium Tax Credits (subsidies)– Individuals and families between 100 - 400% of

poverty, who aren’t eligible for affordable/adequate job-based insurance, Medicaid, or Medicare

Help with Cost-sharing (deductible, copays, and coinsurance)– Individuals/families up to 250% poverty ($28,725

individual)

>$45,960;>400% of FPL

Job-based coverage, or Full-cost Marketplace coverage

$34,470-45,960; 300-400% of FPL

Job-based coverage, or Marketplace coverage: premiums capped at 9.5% of

income by tax credits

$22,980-$34,470;200-300% of FPL

Job-based coverage, or Marketplace coverage: premiums capped at 6.3 –

9.5% of income by tax credits

<$15,856; < 138% FPL

Medicaid (depending on state)

Fam

ily In

com

e2014: ACA Provides Support Fitted to Income

Family income based on 2013 federal poverty income levels for an individual

Premium Tax CreditsPremiums capped at 2-9.5% of income, on sliding scale. Value of credit linked to second lowest-cost silver level plan, but can “go shopping” with tax credit and choose any metal tier level of plan.Tax credits can be paid directly to insurer. Enrollee only owes the difference. Insurers must have ways to accept payments from people who lack credit cards and bank accounts.

Note! Individuals must report changes in income throughout the year or risk

paying back some or all of tax credits to IRS.

Cost Sharing Help

No cost-sharing for recommended preventive servicesOut-of-pocket maximums ($6350 for individual)Cost sharing reductions: deductibles and copays reduced for families under 250% FPL

% of FPL 100-200% 200-300% 300-400% 400%+Annual Out-

of-pocket Maximum

individual $2,017 $3,025 $4,033 $6,050 family $4,033 $6,050 $8,067 $12,100

SHOP: Features of Note for Small Businesses

Ability to more easily compare plans– Online enrollment starts in 2015 for federal SHOP

marketplace“Employee choice”: Ability to give employees a choice of plans – Currently available in most state-based marketplaces– Starts in 2015 for federal SHOP marketplace

Small Business Tax Credit– Only through SHOP starting in 2014

Timeline for Coverage

Individuals:– Initial Open Enrollment: October 1, 2013 –

March 31, 2014– Annual Enrollment: Nov. 15-Jan. 15, 2015– Special enrollment periods for qualifying

events– First effective date is January 1, 2014 (must

enroll by December 15, 2013) Small businesses: continuous enrollment

Medicaid Under the Affordable Care Act

ACA’s Medicaid Expansion

Before ACA:– Medicaid generally not

available to single (childless) adults

– Income eligibility levels vary by state

– Federal minimum benefit requirements; states may modify

After ACA:– States may choose to

make single (childless) adults eligible up to $15,856 for a single person

– Expansion decisions vary by state

– Required “benchmark” benefit package must cover Essential Health Benefits; may vary from state to state

Coverage Gap for People in Poverty

Source: Kaiser Family Foundation

Implementation So Far

ACA Implementation So Far

States of the States:– Insurance Market Reforms: Most (but not all) states

are enforcing the market reforms– Health Insurance Marketplaces: 14 states plus DC

fully running individual and SHOP marketplaces this year

– Medicaid: 26 states expanded to date

Some Bumps in the Road to be expected…But Enrollment is Picking Up

States Running Their Own Marketplaces

CaliforniaColoradoConnecticutDistrict of ColumbiaHawaiiIdaho (in 2015)KentuckyMarylandMassachusetts

MinnesotaNevadaNew Mexico (SHOP only)New YorkOregonRhode IslandUtah (SHOP only) VermontWashington

The Affordable Care Act: What Dance Artists and

Companies Need to Know

What Individual Dance Artists Need to Know

Responsibility for obtaining coverage (individual mandate)How to access coverage (Marketplaces/Medicaid)Other coverage optionsWhat to look for in health insurance coverageHow to get assistance

What Small Companies Need to Know

No responsibility to provide coverage if <50 full-time employeesSHOP MarketplacesSmall Business Tax CreditsHow to get help

What Large Companies Need to Know

Employer responsibility to provide affordable, “minimum essential coverage” if > 50 full-time employees (enforcement delayed until 2015)SHOP Marketplaces open to employers up to 100 employees in 2016Other requirements applying to large employers– Not all requirements apply to self-insured or

“grandfathered” plans

What You Can Do Now

How to Get Moving on Finding Coverage

Explore current coverage optionsVisit healthcare.gov

Links to Marketplaces in every stateCreate an account Get personalized help:–Availability of free “assistors” or

agents/brokers–“Live talk” through call centers or “live

chat” on healthcare.gov

Ways to Enroll

In-person Assistance:

• Agents/Brokers

• Navigators

• Certified Application

Counselors

Special Considerations for Dance Artists

Some Special Considerations for Dance Artists

Know what you are buying– Marketplace vs. non-Marketplace coverage– Understand the tradeoffs (low premiums=higher cost-

sharing)– Understand terminology (deductible, co-pay)– Carefully review benefits in each plan– Tobacco “surcharge”

Provider networks and out-of-network benefitsEstimating income and reporting changes

Questions?

Thank you!

Sarah J. Dash, MPHGeorgetown Health Policy Institute

Center on Health Insurance Reforms sd850@georgetown.edu

202-687-1405

http://chir.georgetown.edu/