OVERVIEW OF THE AFFORDABLE CARE ACT September 23, 2013
Outline The New Continuum of Coverage Medicaid and CHIP Are Changing The New Marketplaces Insurance Affordability Programs Shared Responsibility Requirement
The New Continuum of Coverage
Key Elements of the New Coverage Continuum Medicaid & CHIP Expansion Health Insurance Marketplaces for Private Insurance and Improvements Individuals and Small Businesses Market Reforms • Expands eligibility to 133%* • Launches in fall of 2013 with • Guaranteed issue & FPL for low-income adults coverage effective 1/1/14 renewability • As a result of the Supreme • Will offer Qualified Health Plans • No annual or lifetime limits Court decision, some states (QHPs) with comprehensive • Health status may not be may elect not to expand benefits considered in setting premiums Medicaid • Individuals with incomes 100%- • Must cover preventive health • In all states, makes major 400% FPL are eligible for services at no-cost changes to simplify enrollment premium tax credits and with • Young adults may remain on and allow for coordination with incomes 100-250% FPL are parent’s plan until age 26. the Marketplaces. eligible for cost-sharing reductions to help subsidize the cost of coverage. *138% FPL
Snapshot of Coverage in 2014 The type of health coverage a person receives is based on their income (measured as percent of the FPL) and other factors. Federal Poverty Level 0% 100% 138% 200% 300% 400% Medicaid eligibility levels vary by state Children’s Health Insurance Program (CHIP) eligibility levels vary by state Qualified Health Plans Premium Tax Credits and Cost Sharing Reductions for Qualified Health Plans Employer-Sponsored Coverage
Medicaid is Changing
Medicaid Expansion Enhanced FMAP for Newly Eligible Adults ≤ 133% FPL Covers adults <65 with incomes up to Year State Share Federal Share 133% FPL* who do not fall into an existing coverage category 2014 0 % 100% Provides “ benchmark ” benefits to the 2015 0 % 100% new adult coverage group 2016 0 % 100% Enhanced federal funding All other Medicaid rules apply to new 2017 5 % 95% adult group 2018 6 % 94% About half the states will expand in 2019 7 % 93% 2014 2020 10 % 90% *138% FPL
The New Vision for Medicaid Coverage Expansion: Expands eligibility for low-income adults Single Streamlined Application : Provides new, simple way to apply for coverage for Medicaid and CHIP and other insurance affordability programs (tax credits and cost sharing reductions). Simplified Eligibility and Enrollment Rules: Changes the way eligibility is determined (“MAGI - based rules”), simplifies Medicaid eligibility groups, and requires coordination across Medicaid, CHIP and other insurance affordability programs. Modernized Eligibility Systems: Increases reliance on electronic data sources, minimizes paper documentation, and makes renewal more automatic. Eligibility workers no longer will have to touch every case. Children’s Coverage Improvements: Holds children’s coverage steady through 2019 and applies Medicaid improvements to CHIP.
New Ways to Apply Individuals will have new ways to submit an application for coverage for Medicaid, CHIP and tax credits. They can apply online, in- person, by mail, or by phone. In-person Mail Online Phone
Help From Assisters is Various kinds of entities will help people apply for coverage. Available Your state may already have groups, such as hospitals, clinics, and non- Certified profit organizations, that help individuals apply for Medicaid and CHIP. Application They can continue to do so as “certified application counselor” if they Counselors undergo training and meet other requirements. State Agency (e.g., Depts. Of State eligibility workers will continue to help people apply for coverage. Health / Social They may see an increase in volume as people hear about new coverage Services) options. Marketplaces will establish new “Navigator” programs to help people Navigators applying for coverage. They will assist with QHP enrollment, but also be knowledgeable about Medicaid and CHIP. Non- Sometimes also known as “in - person assisters,” they will provide the same Navigator services as Navigators but be funded by federal grants. Assisters Agents/ Brokers/ Will help people and small businesses apply for Marketplace coverage. Producers
The New Marketplaces
The Marketplace Marketplaces Will Open For Enrollment on October 1, 2013 Coverage is Effective January 1, 2014 Think: A simple way to shop for health insurance Find out your eligibility for QHPs Marketplaces are a major Compare your plan options new entryway Choose a plan and enroll to Medicaid. Find out your eligibility for Medicaid, CHIP, and subsidies Individual Marketplace SHOP Marketplace Small businesses shopping for their employees Consumers shopping for themselves will will use the Small Business Health Options use the Individual Marketplace Program (SHOP) Marketplace
Residents of All States Will Have Access to Marketplaces Three Marketplace Options for States: State-Based State Partnership Federally-Facilitated Marketplace Marketplace Marketplace State takes on some responsibility for State operates all HHS operates all running Marketplace, such as marketplace functions; functions. providing consumer assistance or state may use federal managing which QHPs are offered. government services for However, the Federal government certain activities. remains ultimately responsible.
Who is Eligible for a Qualified Health Plan in the Marketplace? Resident of the state Lawfully present Not incarcerated
Types of Qualified Health Plans Offered in the Marketplace Premium Costs Lower Catastrophic High Deductible Health Plan for individuals up to age 30 or individuals What is actuarial value? exempted from mandate The percentage of an enrollee’s medical Bronze costs that a plan will cover on average. The balance will be covered by the 60% actuarial value enrollee though co-pays and Benchmark Silver deductibles. 70% actuarial value Premium Costs Higher Gold 80% actuarial value Platinum 90% actuarial value
QHPs Cover 10 Essential Health Benefits Ambulatory Patient Services Prescription Drugs Rehabilitative & Habilitative Emergency Services Services & Devices Hospitalization Laboratory Services Preventive & Wellness Services Maternity and Newborn Care & Chronic Disease Management Mental Health and Substance Use Pediatric Services, Including Disorder Services, including Oral & Vision Care Behavioral Health Treatment
Insurance Affordability Programs
Insurance Affordability Programs The Affordable Care Act creates new coverage options by expanding Medicaid and creating Health Insurance Marketplaces that offer Qualified Health Plans (QHPs). The law includes several programs that help low- and moderate-income people purchase health insurance coverage. Together, they are known as “insurance a ffordability programs”. Insurance Affordability Programs Children’s Cost- Advance Health Sharing Premium Medicaid Insurance Tax Reductions Program Credits (CSR) (CHIP) (APTC) NEW federal program that uses tax Existing federal-state NEW federal program Existing federal-state health credits to reduce premium costs for Helps reduce out-of- health insurance insurance program for low QHP enrollees. program for low- and pocket costs for income people. For people who meet financial criteria moderate-income enrollees in QHPs. Expanded to more low-income and don’t have access to other Payments are made children. adults by the ACA. States can coverage. Provides directly to issuers to opt out of expansion. Can be paid in “advance” to provide comprehensive health reduce deductibles, Provides comprehensive immediate help in paying premiums. care benefits co-insurance and/or health care benefits IRS reconciles over/under payments Modest out-of-pocket copayments (out of Minimal out-of-pocket costs. of advance premium tax credits when costs. pocket) costs. people file taxes. 19
Two Types of Financial Assistance for QHPs Premium Tax Credit: 100% - 400% FPL New federal tax credit that will help subsidize the cost of purchasing a QHP on the Marketplace for individuals without access to other coverage. Cost Sharing Reductions: 100% - 250% FPL New federal financial assistance that will help reduce out-of-pocket costs after payment of premiums. Individuals can receive both a premium tax credit and a cost sharing reduction.
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