Many of the remaining regulations of the Affordable Care Act, or ACA, that are driven by healthcare reform will take effect Jan. 1, 2014. If you currently purchase or plan to purchase health insurance for yourself or for your family, you will be affected.
Providence Health Plan offers this information on some of the laws applicable to health care reform so that you can understand the general legal landscape and seek your own counsel. Where possible, we provide tips for how to find additional information from regulators. This guide is offered for general educational purposes only and should not be taken as legal advice.
Here are the key topics that matter most when making health care decisions for 2014.Most individuals will be required to have health insurance coverage.
The ACA requires most U.S. citizens and legal residents to have basic health coverage beginning Jan. 1, 2014, or pay a penalty. Exceptions to this requirement include people with certain religious beliefs, members of Native American tribes, undocumented residents, people who are in prison and people whose income is below a certain level.
If you don't purchase health insurance, the federal government will assess a penalty that you will have to pay on your federal tax return. The penalty will vary by person based on income and household size. In 2014, the penalty is $95 per person and $47.50 per child, up to $285 per family or 1 percent of the family income, whichever is greater. Penalties will increase each subsequent year.Individuals will not be denied coverage due to preexisting conditions because plans no longer will be underwritten.
Health insurance companies will be required to provide coverage to anyone who applies for it and cannot charge premiums based on health status. That means you'll be able to get health insurance coverage, even if you were previously denied. And you can't be charged more if you have significant health issues. Benefits will be more comprehensive.
All health plans will be required to cover a comprehensive package of items and services known as essential health benefits. These essential health benefits include services such as outpatient care, emergency services, mental health and substance abuse care, rehabilitation services and devices, and preventive care.Total out-of-pocket expenses will be capped.
Out-of-pocket expenses, such as copays and deductibles, will be capped. Most health plans must cover a minimum
of 60 percent of average health care costs. In 2014, all individual plans will be categorized based on one of four actuarial value level, known as "metal levels" as follows: bronze, silver, gold or platinum, with platinum plans offering the richest level of benefits. Catastrophic plans, described below, are exempt from this requirement.Some individuals will be eligible for tax credits and/or subsidies to help offset the cost of insurance coverage.
Many individuals and families will qualify for subsidies to help pay their premiums as well as their out-of-pocket expenses. Eligibility is determined based on income and family size.Coverage can be purchased only during open enrollment unless you have a qualifying event.
Open enrollment begins Oct. 1 and ends March 31, 2014. During this period, you can shop and sign up for health insurance coverage. After March 31, you can purchase health insurance for 2014 only if you have a qualifying event. Examples of qualifying events include marriage, divorce, loss of employment, loss of insurance through your employer.
During open enrollment, you will be able to purchase health insurance coverage in many different ways, such as:
Existing plans will be discontinued.
- Directly from an insurance company
- From a producer who represents multiple insurance companies
- From private health insurance exchanges, also known as private health care marketplaces, that represent multiple insurance companies online
- From public health insurance exchanges, also known as public health care marketplaces, that represent multiple insurance companies online and provide tax credits and subsidies to eligible individuals
Existing insurance plans will be discontinued because they do not meet ACA requirements.* If you currently have an individual or family insurance plan, your plan will be discontinued and you will be required to purchase one of the many new plans if you wish to continue being covered.*Discontinuation effective dates will vary by insurance company, and Providence Health Plan Individual and Family plans currently in force will be discontinued Dec. 31, 2013.Catastrophic coverage will be sold only through public exchanges and will be available only to a specific group of people.
Catastrophic coverage, as it exists today, is a health plan with a very high deductible and available to most people. Beginning Jan. 1, 2014, catastrophic health insurance plans will be available to individuals younger than age 30 or those exempt from the individual mandate because no affordable health plan is available to them or because of hardship. For those eligible, a catastrophic plan may be purchased only through a public exchange.Portability plans are going away.
All portability contracts expire Dec. 31. You can purchase an individual insurance policy during the open enrollment period. Beginning in 2014, there is no requirement for insurance companies to offer portability plans.Pediatric dental coverage is required with medical coverage.
Pediatric dental coverage either will be embedded in an insurance company's health plan or it will be available on a stand-alone basis. Embedded means that the dental coverage is integrated with the medical plan benefits. Stand-alone means that the pediatric dental benefits are separate from the medical plan benefits and are purchased separately. When you are shopping for health insurance, be sure to understand whether or not pediatric dental coverage is embedded.
Two important nuances in Oregon:
- Pediatric dental coverage must be offered through Oregon's public health exchange, Cover Oregon, though you are not required to purchase it along with a medical plan if it's not embedded.
- If you purchase a medical plan outside of Cover Oregon, you are required to purchase pediatric dental coverage if it isn't embedded, regardless of your age.
We understand there is a lot to consider. Use this guide to understand how health care reform affects you and to prepare for the upcoming changes.