While the federal budget in Washington, D.C. shuts down over health care funding, the health insurance market in Arkansas is about to open a new outlet for business.
The Health Insurance Marketplace (HIM) is expected to launch on Tuesday, Oct. 1, but state Insurance Commissioner Jay Bradford said to expect “a bumpy road” as the major health care overhaul is instituted.
“It’s an arduous task, everything’s coming together at once,” said Bradford in a recent interview. “You’ve got the federal system, our state system, the Medicaid system – all blending in for this whole project. No one has ever done it before.”
THE INS & OUTS
The HIM is an online resource where consumers can shop for and compare rates for health insurance policies from four different carriers. Earlier last week, the Arkansas Insurance Department released the rates for 71 gold, silver, bronze and platinum plans that provide a variety of different coverage rates for Arkansans.
The different plans have varying levels of deductibles and benefit obligations aimed at providing affordable options for health insurance enrollees. The HIM is an outcome of the Affordable Care Act and is expected to serve as many 500,000 low-income or uninsured Arkansans, roughly 17% of the state’s population of nearly 3 million. In many instances, tax credits or subsidies are available for potential consumers, and age, geography and smoker/non-smoker status can affect a plan’s cost.
As part of the ACA, participants cannot be denied for pre-existing conditions and they do not have to wait for any extended periods of time to enroll. There are no lifetime caps on health care benefits and adult children are allowed to stay on their parents’ plans until age 26, among several major changes to previous health insurance policies.
The HIM is not for everyone. Insurance officials say if you currently have insurance coverage – through an employer or Medicare – the marketplace shouldn’t apply to you.
However depending on your situation, your employer insurance may not be deemed affordable (9.5 percent of household income for employee only coverage). Because large employers are not required to offer all of the essential health benefits, consumers may find options in the HIM.
There are penalties for those who do not sign up for health insurance. If you’re uninsured for three months or more in 2014, you’ll pay a penalty of $95 per adult and $47.50 per child (up to $285 per family) or the greater of one percent of taxable income. That means an Arkansas worker making more than $9,500 will be paying the one percent of taxable income penalty rate if he opts to not be covered. The penalty increases in future years.
The online web site – www.arhealthconnector.org – has been in preparation for many months. It is accompanied by a toll-free help number – 1-855-283-3483. Heavily advertised in recent weeks, it should go live on Tuesday morning despite an Arkansas legislative committee, led by GOP lawmakers, voting to halt a $4.5 million advertising contract to continue its promotion.
“It was an unnecessary expenditure of tax dollars,” said State Rep. Andrea Lea (R-Russellville), noting that the AID indicated the web site had already received 350,000 hits before its launch. “I voted ‘no’ a year ago, I voted ‘no’ today. We do not need to spend more advertising dollars on this.”
Gov. Beebe (D) said on Monday (Sept. 30) that he’ll abide by legislators’ wishes and not pursue the advertising contract, but is willing to explore other options to promote usage.
The web site addresses situations for individuals and families, employers, employees, and agents and brokers. It features a variety of answers to frequently asked questions for the different categories of potential participants.
HOW IT WILL WORK?
Below are two videos from the federal government that walk through examples of a person applying for information on health insurance plans and enrolling in an insurance plan.
State insurance officials say they are representative of how the Arkansas site will operate.
Participants create an account to fill out information including name, address, phone number, age, family members, and household income. Once the application is completed and submitted, a person is steered to “application results,” which show health plans and potential tax credits for which he may be eligible.
If a person wants to proceed, they can begin the enrollment process for health insurance. According to the federal government video example, a participant can decide how to apply a tax credit for the plan by using all, part or none. The trade-off for utilizing the credit can either result in a lower monthly insurance premium or money back on a federal tax return.
There is a filter process once a person begins narrowing down their health plan choices that allows for side-by-side comparisons of different options. The comparisons outline how the premiums, deductibles, and out-of-pocket maximum costs line up with one another.
Like a shopping cart on a retail web site, plans can be saved for later review while more comparison shopping continues.
At the end, a user enrolls and sets up a payment plan or, in theory, can connect to a customer service representative with the health insurance provider selected.