How Healthcare Reform Affects You
Since you have healthcare coverage through your employer, you might think the Affordable Care Act doesn’t apply to you. Your employer may continue to offer you healthcare coverage, but it’s a good idea to know what’s changed and how you might be able to benefit from the new Affordable Care Act options.
You may already have some new benefits, did you notice?
Since being signed into law in 2010, the Affordable Care Act has probably already changed your health plan. Children can now remain on a parent’s health insurance plan until age 26. Insurers must cover preventive care, including immunizations and wellness check-ups for women, babies, and kids (there are exceptions for grandfathered plans). If you are shopping for new coverage, you can’t be turned down or charged more if you are sick. Insurers can no longer limit your coverage due to pre-existing conditions.
Beginning in 2014, most of us are required to have health coverage. With some exceptions, individuals who go without coverage will generally be subject to an annual penalty in 2014 of 1% of income or $95 per person, whichever is greater. The maximum penalty per family in 2014 is $285. Individuals like you who choose to enroll in health benefits through work are don’t need to worry about this penalty.
What will happen to employer coverage
Starting in 2015, some companies will be subject to a penalty if they don’t offer affordable healthcare coverage to employees. If the penalty is less than what it costs them to offer benefits, they may chose to drop coverage and pay that penalty.
It’s difficult to predict how many companies will do this, but we do know that before the Affordable Care Act, most large companies offered health benefits without a requirement. Healthcare is something that qualified employees have come to look for in a job.
Still, the health plan you have through work could change as employers adapt to the new law. Over time, your plan’s premiums may rise, doctors’ networks may become smaller, or you may pay more out-of-pocket.
What happens if you lose employer coverage
If your employer stops offering health benefits, or ends your coverage due to a layoff or termination, you’ll have to get a health plan on your own, or you might face the individual penalty fee.
There is a public exchange, or Marketplace, to help you choose a health plan. Think of the Marketplace as something like an online travel site, but instead of travel you compare health plan premiums, provider networks, deductibles, and out-of-pocket costs for things like copayments and prescriptions. Plans sold through the Marketplace come from health carriers like Humana. You can also purchase individual and family coverage directly from these health carriers rather than through the Marketplace.
If you shop on the Marketplace, you can select from Bronze, Silver, Gold, or Platinum plans. Bronze plans will have the lowest annual premium, and the highest deductibles and copays. Platinum plans will have the highest up front premiums, and lower deductibles and out-of-pocket costs. There is also a catastrophic plan option for those 30 and younger, which has low annual and out-of-pocket costs in exchange for a very high deductible in the event of a serious accident or illness. (There are also hardship exemptions for some individuals older than 30 who qualify.)
Understand the new tax credits
Some individuals and families who buy plans on the Marketplace will qualify for subsidies to help pay for them. Advance tax credits are available on a sliding scale based on income. Individuals with incomes less than 400% of the Federal poverty line (around $46,000 for the average single person in the US) may qualify for a credit that represents the difference between what you are expected to pay and what you actually pay for your plan. Tax credits can be applied to premiums for every type of plan on the Marketplace, except for catastrophic plans.
Individuals with incomes between 100% and 250% of the Federal poverty line (or about $11,500 to $28,500 in 2013) may also qualify for a cost-sharing subsidy to help pay for high out-of-pocket costs.
You can visit the Marketplace to determine if you’re eligible for a tax credit or subsidy and compare premiums, deductibles, and out-of-pocket costs. Your employer may also provide details to help you compare your current plan to potential options.
So if you and your employer are happy with your current health benefits, things may not change much for you in the wake of the Affordable Care Act. But if you are wondering if there is a more affordable option, you can always shop around and compare prices on the Marketplace or with individual insurance carriers.
Have questions? Contact us
This information is only a high-level summary of certain provisions of the health care law. This information does NOT attempt to summarize all provisions of the health care reform law. This information is not and should NOT be used as legal or tax advice; it should not be used as a basis for decisions regarding how the health care reform law will affect you and/or your business. Should you have any questions on how the health care reform law (including the high level summary of certain provisions of health care reform) will affect you and/or your business, you should seek professional advice from attorneys or other advisors.
Insured by Humana Insurance Company, Humana Health Plan, Inc., Humana Health Insurance Company of Florida, Inc., or Humana Health Benefit Plan of Louisiana, Inc. or offered by Humana Medical Plan Inc., Humana Employers Health Plan of Georgia, Inc., or Humana Health Plan of Texas, Inc.
For Arizona residents: Insured by Humana Insurance Company. For Texas residents: Insured by Humana Insurance Company or offered by Humana Health Plan of Texas, Inc.
Our health benefit plans have exclusions and limitations and terms under which the coverage may be continued in force or discontinued. For costs and complete details of the coverage, call or write your Humana insurance agent or broker.