Frequently Asked Questions
Health care has changed in many ways as a result of the passage and implementation of the Patient Protection and Affordable Care Act, Public Law 111-148 (PPACA), and the Health Care and Education Reconciliation Act of 2010, Public Law 111-152). These two laws are collectively known as the Affordable Care Act (ACA).
- + Health Care Reform Overview
- + What is the Affordable Care Act (ACA)?
Legislation signed by President Obama on March 23, 2010, that made historic changes in the availability and delivery of health insurance, Medicaid and health policy nationwide. Commonly referred to as the health reform law, Patient Protection and Affordable Care Act (PPACA), and Obamacare.
- + When will the ACA take effect?
It will take five years for the health insurance reforms adopted as part of the ACA on March 23, 2010 to be fully in effect. Most reforms won’t happen until January 1, 2014. However, some new protections already are in place.
- + What changes are already in place?
Several changes are already in place:
- Lifetime dollar limits on essential health benefits aren’t allowed. Annual dollar limits on essential health benefits are being phased out by January 1, 2014.
- The appeal procedures available to consumers are different.
- Insurers can’t deny coverage to children younger than 19 years old because of a pre-existing condition.
- Nearly all adult children up to age 26 are eligible to remain on a parent’s health insurance policy, regardless of the child’s marital status, financial dependency, enrollment in school, or place of residence.
- In-network and participating providers must cover preventive services. There can be no cost-sharing for preventative services.
- Consumers have more access to information about proposed rate changes.
- Medical loss ratio standards limit how much of premium dollars insurers can spend on administrative expenses.
- All insurers must use a standardized Summary of Benefits and Coverage (SBC), which will make it easier to compare plans.
- Small businesses that provide health care for employees can apply for a tax credit.
- Persons with Medicare prescription drug coverage receive a rebate to help cover the cost of the “donut hole.” This “donut hole” should be totally phased out by 2020.
- ACA made subsidized coverage available in every state for people with pre-existing conditions who can’t find coverage in the private market. However, because there’s not enough money, no new enrollments in this program are being accepted.
- + What changes will take effect on January 1, 2014?
Consumers will see a number of major changes in plans sold or renewed on or after January 1, 2014:
- Plans must include new consumer protections. Health insurers can no longer deny or refuse to renew coverage because of a pre-existing medical condition. They also can’t charge a higher premium due to a person’s gender or health condition.
- Insurers must cover routine medical costs if a person participates in a clinical trial for cancer or other life-threatening diseases. Insurance plans also can’t put annual dollar limits on essential health benefits.
- Individuals who can afford it must have basic health insurance coverage, referred to in the ACA as “minimum essential coverage.”
- Exchanges, which will begin enrollment on October 1, 2013, are expected to start operating in every state.
- Individuals and families who need help affording coverage may have access to financial assistance when they shop in the new health insurance exchanges.
- + Where can a person find more information about the ACA, including detailed timeline information?
The Kansas Insurance Department has established its own site to answer ACA questions here at insureKS.org or call the department’s toll-free hotline at 800-432-2484.
For more detailed information about the ACA and its key provisions, visit the federal government’s website at www.healthcare.gov or call 1-800-318-2596 (TTY: 1-855-889-4325).
For more detailed information about the timeline related to the ACA, see the federal government’s website at www.healthcare.gov/timeline-of-the-health-care-law.
There are also a number of other helpful sites and resources for more information about the ACA, including: Kaiser Family Foundation (kff.org); Commonwealth Fund (http://www.commonwealthfund.org/Health-Reform/Health-Reform-Resource.aspx); and The Robert Wood Johnson Foundation (www.rwjf.org).
- + Exchange Basics
- + What is the Health Insurance Marketplace?
The Health Insurance Marketplace is the federal health insurance exchange that will be operated for Kansas. The ACA created health insurance exchanges as places where individuals, families, and small employers can compare private health insurance plans and shop for coverage. Exchanges also provide access to a new type of tax credit to help lower and middle-income individuals pay for coverage. Through exchanges, many lower-income individuals can get help to reduce their out-of-pocket costs (deductibles, coinsurance, or copayments) when they receive health care services. Insurers may sell plans through the exchange as well as in the market outside the exchange. Premium tax credits and cost-sharing reductions are not available for plans outside the exchange.
To learn more go to insureKS.org, or to apply for coverage through the Health Insurance Marketplace, individuals and families should visit HealthCare.gov. For more general information about health insurance exchanges, visit the federal government’s website https://www.healthcare.gov/what-is-the-health-insurance-marketplace.
- + Are there different types of health insurance exchanges?
While the basic features of exchanges are the same in all of the states, the ACA allows for differences in who operates them. Some states run their own exchange (known as state-based exchanges) and some have the federal government run it (known as federally facilitated exchanges). In Kansas, the Health Insurance Marketplace and SHOP Marketplace for Small Businesses are federally facilitated exchanges; however, the federal government relies on the Kansas Insurance Department to approve insurers, plans and rates, provide consumer assistance and perform other regulatory roles.
- + What is the Multi-State Plan Program?
Under the ACA, there is a new program called the Multi-State Plan Program (MSPP) administered by the U.S. Office of Personnel Management (OPM). For 2014 there will be one MSP (multi-state plan) available through the Health Insurance Marketplace in Kansas. It is available in all Kansas counties except Johnson and Wyandotte. OPM, which also administers the program that provides health insurance to Federal government employees, retirees, and their dependents, will contract with private insurance companies to offer MSPs on the exchanges. OPM will work closely with state regulators to monitor multi-state plans. More information about the MSP is available on OPM’s website: http://www.opm.gov/healthcare-insurance/multi-state-plan-program/
- + If a person lives in one state but works in another, to which state’s exchange should they apply?
If a consumer doesn’t have access to coverage through their employer (or their spouse’s employer), they should apply for coverage in the state where they live.
- + Who can buy a plan through the Health Insurance Marketplace?
In Kansas, any individual or family may buy coverage through the Health Insurance Marketplace. The only people who can’t are those who aren’t legally in the United States or who are incarcerated (other than pending disposition of charges).
Small employers (employers with 50 or fewer employees) may buy health insurance for their employees through the SHOP Marketplace for Small Businesses.
- + When will consumers be able to enroll in plans through the Health Insurance Marketplace?
In Kansas, individuals and families may enroll through the Health Insurance Marketplace beginning October 1, 2013 and continuing through March 31, 2014.
Coverage becomes effective on January 1, 2014 for people who sign up between October 1 and December 15, 2013. For people who sign up between December 16, 2013 and January 15, 2014, coverage will be effective on February 1, 2014. Following that, coverage will be effective on the first day of the following month if a consumer enrolls by the 15th. If after the 15th, coverage will be delayed an additional month.
In future years, open enrollment will be each year between October 15 and December 7. During this time, consumers will be able to change plans, change insurance companies or stay with the plan they have, if it is still available. Consumers also may be eligible to enroll in coverage at times other than the open enrollment period. There are special enrollment periods for individuals or families if they experience a “triggering event.” Some examples of triggering events include: loss of minimum essential coverage for an individual or their dependent; marriage, birth or placement for adoption; gaining citizenship or legal immigration status; and change in eligibility for tax credit or cost-sharing reduction.
Contact the Kansas Insurance Department at 800-432-2484 or the Health Insurance Marketplace at 800-318-2596 for information about whether a consumer might be eligible to enroll in coverage through the Health Insurance Marketplace during a special enrollment period.
- + How can a consumer prepare for October 1, 2013 when the Health Insurance Marketplace begins operating?
Even before October 1, 2013, there are a number of steps consumers can take to prepare. The federal website https://www.healthcare.gov/how-can-i-get-ready-to-enroll-in-the-marketplace has suggestions for things consumers should be thinking about to prepare to enroll in a plan through the exchange. The Kansas Insurance Department has established this special website at insureKS.org with helpful information for consumers who are thinking about enrolling in a plan through the Health Insurance Marketplace.
Consumers who don’t currently have health insurance coverage should find out if help might be available now through existing programs or because of changes already in effect from the ACA. For example, a parent’s plan may cover young adults under age 26. The federal website https://www.healthcare.gov/what-if-i-need-coverage-that-starts-before-january-2014 has tips to find coverage. Consumers also can contact an insurance agent for help.
Consumers also can check with employers to find out whether they intend to offer health insurance coverage in the future or whether the coverage they currently offer meets the minimum level to meet the law’s requirement and avoid paying a penalty. Insurance companies must tell policyholders if their plan doesn’t meet the ACA requirements. Employers must inform their employees.
Finally, consumers can start gathering basic information about household income, such as their current tax return if they filed one, or other income information. Many people will qualify for tax credits or other financial help to make insurance affordable and consumers will need income information to determine their eligibility. Consumers can find more information about how to save money on coverage at https://www.healthcare.gov/how-can-i-save-money-on-marketplace-coverage/.
For updated information, visit the federal government’s website at www.healthcare.gov or call 1-800-318-2596 (TTY: 1-855-889-4325).
- + Shopping for Health Insurance Coverage
- + What types of plans will be available through the Health Insurance Marketplace?
Health plans sold through the Health Insurance Marketplace will be required to meet comprehensive standards for items and services that must be covered. To help consumers compare costs, plans available through the Health Insurance Marketplace will be organized in four tiers, or four levels of generosity of the cost-sharing that each plan includes:
- Bronze level –The plan must cover 60% of expected costs across a standard population. This is the lowest level of coverage.
- Silver level – The plan must cover 70% of expected costs across a standard population.
- Gold level –The plan must cover 80% of expected costs across a standard population.
- Platinum level – The plan must cover 90% of expected costs across a standard population. This is the highest level of coverage.
Also, a catastrophic plan will be offered, and will cover the same services. But, its coverage will be less generous than the Bronze level plans. A catastrophic plan may be a less expensive option for those who are eligible: only young adults under 30 and individuals who have a hardship exemption from the individual mandate are allowed to purchase catastrophic plans. Premium tax credits and cost-sharing reductions are not available for catastrophic plans.
Also, stand-alone dental plans are available through the Health Insurance Marketplace.
- + How do the tiers (bronze, silver, gold and platinum) help consumers compare plans?
The tiers are a way to categorize plans based on “actuarial value.” Plans within each tier have a similar actuarial value, even if they cover benefits differently or have different cost-sharing. While all plans in a tier must cover essential health benefits, the details of their coverage (such as how many physical therapy visits are covered or which prescription drugs are covered) may be different. Some plans may offer benefits in addition to the essential health benefits.
- + What is actuarial value?
Actuarial value compares how much the insurance company will pay versus how much you will pay for health care costs. The percentage the plan pays depends on the cost-sharing details – how much out-of-pocket the consumer pays for deductibles, coinsurance, and copayments and the out-of-pocket limits. The percentage is an estimate of what the plan will pay for all policyholders. Your individual benefits may be more or less.
Actuarial value only reflects differences in cost-sharing. It doesn’t give any other information about a plan that may be important to a particular person or affect their costs. It doesn’t tell you how broad or narrow a plan’s provider network is, the quality of the provider network, about the plan’s customer service and support, how broad or narrow the drug formulary is, or the premium levels. All of this information is important for consumers to consider when they choose a plan.
See www.healthcare.gov/how-do-i-choose-marketplace-insurance for additional information for consumers about actuarial value.
- + What insurance companies will offer coverage through the Health Insurance Marketplace? How can I get a list of companies and plans available?
There will be listings of the health plans available through the Health Insurance Marketplace at HealthCare.gov and the SHOP Marketplace for Small Businesses at https://www.healthcare.gov/small-businesses/. People without access to the Internet can call the customer service line for the Health Insurance Marketplace at 800-318-2596, and for the SHOP Marketplace for Small Businesses at 800-706-7893, or get help from an agent or other type of assistor.
- + How can a consumer find out the details about what a particular plan covers?
To learn if a specific benefit is covered, and at what level, check a plan’s Summary of Benefits and Coverage (SBC). An SBC is a uniform document that includes details about what a plan does and doesn’t cover. It also includes information about what kinds of costs a consumer can expect to pay out-of-pocket, such as copayments, coinsurance, and deductibles. An SBC comes with plans offered through the exchange and in the market outside the exchange. It gives information in the same way for every plan to make it easier to compare plans. The SBC forms will be available through the Health Insurance Marketplace or from an agent for plans offered in the market outside the exchange.
The Health Insurance Marketplace website at HealthCare.gov includes information about what each plan covers and links to the insurer’s plan brochures.
Consumers can read more about the Summary of Benefits and Coverage here: http://www.cms.gov/CCIIO/Programs-and-Initiatives/Consumer-Support-and-Information/Summary-of-Benefits-and-Coverage-and-Uniform-Glossary.html
- + How can consumers compare benefits and understand what a plan covers?
Today, every insurance company and group health plan must give consumers a Summary of Benefits and Coverage (SBC) and glossary of commonly-used terms both before they enroll and each year at plan renewal time. Through an SBC, consumers can compare insurance options based on covered benefits, excluded services, deductibles and out-of-pocket costs, as well as other features that may be important to them.
An SBC is designed to help consumers compare plans and understand the benefits and coverage limits of their plan in clear and concise language.
In addition to getting an SBC, starting on October 1, 2013, when the Health Insurance Marketplace opens, consumers also will be able to get information about the health plan options available online at the Health Insurance Marketplace website at HealthCare.gov , through the Marketplace’s toll-free telephone number, 800-318-2596, or from agents, navigators or certified application counselors.
A copy of the form for an SBC can be found at http://www.cms.gov/CCIIO/Resources/Forms-Reports-and-Other-Resources/Downloads/sample-completed-sbc.doc
- + How can consumers see and compare prices for plans?
The Health Insurance Marketplace is set up to let consumers compare policies on the basis of price, actuarial value and other factors. Consumers can get this information from the Health Insurance Marketplace website at HealthCare.gov or call center at 800-318-2596. Also, agents, navigators, and certified application counselors should be able to help consumers compare plans.
Consumers will not be able to see the cost of a specific service or benefit unless that service or benefit is provided through a stand-alone dental plan.
- + Can an insurance company charge tobacco users more than non-tobacco users?
Yes. Under the ACA, health insurance companies can ask about tobacco use before they enroll a consumer in a plan, and can then charge consumers who use tobacco products a higher premium. This additional premium is not eligible for premium tax credits. Consumers in group plans may not have to pay this extra charge if they complete a tobacco cessation program.
- + Are dental or vision benefits available through the Health Insurance Marketplace?
The ACA requires plans sold through the Health Insurance Marketplace to include vision coverage for children, but there is no process for offering a stand-alone vision plan through the Marketplace. Dental benefits are treated differently. The ACA lets insurance companies offer health plans through the Marketplace that do and don’t include pediatric dental benefits. The Marketplace also will offer stand-alone dental plans that include pediatric dental benefits. In Kansas some medical plans on the Marketplace offer pediatric dental and others do not. Stand-alone dental plans for children and adults are available.
If a consumer has minimum essential health coverage from another source, they may buy a stand-alone dental plan on the Marketplace without purchasing medical coverage.
Check the federal website HealthCare.gov for more information about dental benefits.
- + How Health Plans Work
- + What services/benefits must plans cover? What are essential health benefits?
After January 1, 2014, plans sold in the individual and small group market, including those sold through the Health Insurance Marketplace and SHOP Marketplace for Small Businesses, as well as most plans sold in the market outside the exchange, must cover, at a minimum, a comprehensive set of benefits known as essential health benefits. These essential health benefits include the following:
- Ambulatory patient services
- Emergency services
- Maternity and newborn care
- Mental health and substance abuse disorder services, including behavioral health treatment
- Prescription drugs
- Rehabilitative and habilitative services and devices
- Laboratory services
- Preventive and wellness services, including chronic disease management
- Pediatric services, including oral and vision care
Many documents about the Kansas essential health benefits can be found at http://www.ksinsurance.org/EHB. For more detailed information about essential health benefits in the Health Insurance Marketplace, visit the NAIC website at http://www.naic.org/index_health_reform_section.htm under Essential Health Benefits Data from The Center for Consumer Information and Insurance Oversight (CCIIO).
- + Can a person take benefits out of a plan? What if a consumer doesn’t need all of the benefits in a plan?
No, consumers can’t take benefits out of a plan. At a minimum, every health plan on the Health Insurance Marketplace must provide coverage for all of the essential health benefits the ACA requires. Even though a person may not need every benefit in a plan, plans must cover all of the essential benefits to share risk across a broad pool of consumers and be sure all benefits are available for everyone. This also helps to protect people from risks they can’t always predict across their lifetimes.
- + Can a person’s health condition affect their coverage?
No. Under the ACA, health insurance companies can no longer limit coverage based on a person’s health condition, called “pre-existing conditions.” Nor can they charge a higher premium because of a person’s health condition. These protections apply whether a person buys coverage through the exchange or outside the exchange.
- + What are preventive benefits and how are they covered?
Preventive benefits are designed to keep people healthy by providing screening for early detection of certain health conditions or to help prevent illnesses. The ACA requires that all plans except grandfathered plans cover many preventive services with no out-of-pocket costs (meaning no deductibles, co-payments, and coinsurance). Some of these covered preventive services are:
- Colorectal cancer screenings, including polyp removal for individuals over age 50
- Immunizations and vaccines for adults and children
- Counseling to help adults stop smoking
- Blood pressure screening for adults
- Cholesterol and diabetes screening for certain adults
- Well-woman checkups, as well as mammograms and cervical cancer screenings
- Well-baby and well-child exams for children
Unless an insurer does not have an in-network provider to perform a particular preventative service, plans are permitted to charge for these preventative services when performed by an out-of-network provider.
For more detailed information about covered preventive services, visit the federal government’s website at: https://www.healthcare.gov/what-are-my-preventive-care-benefits.
- + How does a consumer find out what drugs a plan covers?
Health insurers keep lists of which drugs are covered and which are covered at the lowest cost for each of their plans. These lists are called formularies. Drug cost-sharing is often “tiered;” that is, consumers pay less for a generic drug, more for a brand-name drug, and sometimes even more for a non-preferred brand-name drug. Consumers should review the formularies in any plan they select to be sure they meet their prescription drug needs and to know what cost sharing is required for any given drug. For plans that use formularies, statements of benefits and coverage include an internet address for obtaining information on the plan’s drug coverage, and the Health Insurance Marketplace will include links to company formularies. Consumers also can call the health insurer for help.
- + What are out-of-network services and do consumers have any coverage for them?
Services are considered out-of-network if they’re from a doctor, hospital, or other provider that doesn’t have a contractual relationship with a particular health plan. Not all plans cover out-of-network services, but when they do, a consumer’s share of the cost is usually higher than for an in-network service. Consumers may want to find out whether a provider is in-network before they receive services. Consumers may also want to find out if their regular health care providers are in-network before they buy a plan.
Though the ACA limits how much money a person is required to spend on his or her family’s health care, out-of-network services do not count toward these limits.
A plan’s Statement of Benefits and Coverage will include information about coverage for out-of-network services.
- + How do consumers determine if their doctor or dentist is in the network?
The Health Insurance Marketplace and the SHOP Marketplace for Small Businesses will include a link to the insurance company website that will let consumers look up whether or not their doctor is in a plan’s network. It’s always a good idea to also check with the doctor or dentist before you schedule an appointment to learn if the information on the website is up to date.
- + Do consumers have access to emergency care out-of-network?
Yes, the ACA requires any health plan that provides benefits for emergency services to cover them regardless of whether the provider is in or out of the network. Under the ACA, health plans aren’t allowed to charge a higher copayment or coinsurance for out of network services received in an emergency. In addition, Kansas prohibits balance billing for emergency care received out-of-network, meaning only in-network rates will apply for all emergency care.
- + Do consumers have to re-enroll annually?
Eligibility for premium assistance and enrollment in a health plan will be decided annually using updated income, family size, and tax information (when authorized). Each year, before the open enrollment period, the Health Insurance Marketplace will check income data and send a notice to consumers who are determined eligible for enrollment in a plan through the Marketplace. This notice explains the consumer’s eligibility for the upcoming year and tells the consumer to let the Marketplace know of any changes. After this, there will be an annual open enrollment period for consumers to change plans or insurance companies if they want to.
During the year, consumers must report any changes in circumstances to the Health Insurance Marketplace within 30 days of experiencing the change. Changes include changes in income from a new job. Consumers who have not requested financial assistance do not need to report changes related to financial assistance eligibility. The Marketplace will review available data sources on a quarterly basis for individuals who become eligible for Medicare, Medicaid or CHIP.
- + Under what circumstances can consumers enroll if they didn’t when enrollment was first available?
If consumers do not enroll during the initial open enrollment period (October 1, 2013 - March 31, 2014), they can enroll during annual open enrollment (October 15 – December 7) of each year starting in 2014 or may be eligible to enroll during a special enrollment period under certain circumstances, Examples of special enrollment periods are when an individual or dependent loses health insurance coverage, or an individual gains a dependent or becomes a dependent through marriage, birth or adoption, or an individual moves into a new exchange service area.
- + Employer-Sponsored Coverage
- + What is a “grandfathered” health plan?
A grandfathered health plan is a plan that has existed continuously since before March 23, 2010 without significant changes in the plan. Grandfathered plans aren’t subject to many of the requirements of the ACA, such as the requirement that plans cover essential health benefits.
Grandfathered plans that make certain changes, such as significant increases in their cost-sharing, (such as coinsurance, deductibles, copayments), or eliminating benefits to diagnose or treat a particular condition may lose grandfathered status and then would have to follow the ACA. Employer-sponsored plans that substantially raise the employee share of the premium also could lose grandfathered status.
A plan must indicate in the plan materials if it is a grandfathered plan. Also, consumers can check with their insurance company or employer.
- + What is the SHOP Marketplace for Small Businesses?
Under the ACA, states may create small business health options programs (SHOP) exchanges, where small employers who want to offer coverage to their employees can shop for plans. In Kansas, this is the SHOP Marketplace for Small Businesses offered by the federal government. For 2014, under the federal SHOP, employers will select the plans that will be available to their employees.
After 2014, employees should have a choice of health plans available from insurers participating in the SHOP. When employee choice is available, employers will get a single aggregated bill for all their employees regardless of how many different insurers’ plans are chosen by employees.
There are resources for information about small employer issues and the ACA on the following websites:
- + Is there a cost to participate in the SHOP Marketplace for Small Businesses?
There’s no fee for small employers to use SHOP.
- + Can insurers charge more (or less) for policies sold through SHOP Marketplace for Small Businesses than they charge outside the SHOP?
No, insurers must charge the same for same plans whether they’re sold through SHOP Marketplace for Small Businesses or in the market outside of the SHOP.
- + What happens if an employer’s staff increases to more than 50 employees after the employer bought coverage through the SHOP?
The small employer will still be eligible to buy health insurance through the SHOP Marketplace for Small Businesses because the employer had 50 or fewer employees at the time they first bought coverage through the SHOP.
- + How will employers with fewer than 100 employees, but more than 50, be affected in 2016 when the definition of small group increases to 100?
Beginning in 2016, employers with up to 100 employees will be eligible to buy small group health insurance coverage through the SHOP Marketplace for Small Businesses.
- + How are small employers defined for purposes of purchasing on the SHOP Marketplace for Small Businesses?
In 2016, to be eligible for the SHOP Marketplace for Small Businesses, a small employer will be defined as an employer with 100 or fewer employees. Before then, in Kansas a small employer is defined as an employer with 2 to 50 full-time employees.
- + How do employers with full-time and part-time employees know whether they’re required to offer health insurance?
Once the federal calculation for full-time equivalent employees is finalized, all employers will want to determine whether they have at least 50 full-time equivalent employees. Penalties have been delayed a year, and will not be assessed until January 1, 2016 against employers with at least 50 full-time equivalent employees not offering health coverage in 2015, and will only be assessed if an employee gets the premium tax credit.
Below are links to the IRS proposed regulation and notice of delayed implementation:
- + Are small employers who decide to buy health insurance for their employees required to do so through the Health Insurance Marketplace?
No, small employers may buy health insurance for employees through SHOP or in the market outside the exchange. It will be important for small employers to understand and compare all options available to them. State licensed health insurance agents are available to help small employers compare options and determine which plan best meets their needs.
- + Can insurers require employers to meet an employee participation rate to buy small group coverage through the SHOP Marketplace for Small Businesses or in the market outside the SHOP?
Common practice in Kansas has been a participation rate of 75% of a small business’ employees taking the health care plan. The federal government has proposed a rate of 70%. However regardless of the participation rate, small employers must be allowed to purchase coverage during an annual enrollment period that begins November 15 and extends through December 15 of each year.
- + Can small employers who are the sole employees of their business buy small group coverage either through the SHOP Marketplace for Small Businesses or outside the marketplace?
No. Neither federal nor state law lets insurers sell small group health insurance plans to self-employed individuals with no other employees. Self-employed individuals with no other employees can buy coverage through the Health Insurance Marketplace for individuals or individual coverage outside the Marketplace.
- + What are the penalties if large employers don’t provide coverage?
Large employers may have to pay a tax penalty if they don’t offer affordable coverage that provides minimum value for at least 95% of their full-time employees and their dependents, or all but 5 full-time employees, whichever is greater, and at least one of their employees gets premium tax credits through the Health Insurance Marketplace. The penalty will be imposed starting January 1, 2016 for plan year 2015. For detailed information, employers should seek professional advice.
The penalty for a large employer that doesn’t offer coverage to full-time employees and their dependents is $2,000 multiplied by the number of applicable full-time employees, if at least one full-time employee has received a tax credit from the Health Insurance Marketplace. The first 30 employees are exempted in the count.
Similarly, the penalty for a large employer that offers coverage that isn’t affordable or doesn’t give minimum value is $3,000 multiplied by the number of full-time employees who are receiving tax credits. (The maximum penalty may not be greater than $2,000 multiplied by the total number of all full-time employees.)
- + How do small employers find out if they’re eligible for the small employer tax credit?
For an employer to qualify for federal small business tax credits, they must: (1) have fewer than 25 full-time equivalent employees; (2) pay employees an average annual wage of less than $50,000, and (3) pay at least half of the insurance premiums.
In 2014 the tax credit will increase from a maximum of 35% to a maximum of 50% and will only be available to small employers buying health insurance through the SHOP Marketplace for Small Businesses.
Contact the SHOP Marketplace for Small Businesses at 800-706-7893 for more information. A competent tax advisor also should be able to advise a small employer. There’s more information on the Internal Revenue Service website at http://www.irs.gov/uac/Small-Business-Health-Care-Tax-Credit-Questions-and-Answers:-Calculating-the-Credit.
- + What ACA requirements apply to large employers?
A number of ACA requirements apply to non-grandfathered health plans that large employers offer on either an insured or self-insured basis. The requirements include limits on out-of-pocket expenditures and waiting periods, no annual or lifetime dollar limits of coverage or cost sharing for preventive services, the requirement that coverage be offered to adult children up to age 26, and the requirement of access to internal and external appeals. Also, large employers are required to offer affordable and adequate coverage or face a tax penalty.
- + How Employees Are Affected
- + Is employer-based coverage required to cover dependents (spouses and children)?
Under the ACA, if an employer with 50 or more employees doesn’t offer coverage that meets minimum standards for employees and their dependents, and employees access premium tax credits through the exchange, the employer may have to pay a tax penalty beginning for plan year 2015. However, the proposed rules about employer shared responsibility have interpreted the phrase “and their dependents” to mean children under age 26, but not spouses. At this writing, final regulations haven’t yet been issued. For more information, see http://www.irs.gov/pub/newsroom/reg-138006-12.pdf. Small employers with fewer than 50 employees aren’t required to offer coverage to employees or their dependents.
Also, if employer-based coverage includes children, the ACA requires the employer to let children up to age 26 stay on their parent’s policy. Adult children can stay on their parent’s policy whether or not they live in the parent’s home, are married, or the parent no longer claims them as a dependent on their tax return. The employee can be required to pay for this coverage, however.
- + What can a consumer do when employer-based health coverage ends?
Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), a federal health law since 1986, when an employee and his or her dependents lose employer-based coverage they’re still eligible to stay on their employer’s group health plan, even though that coverage would otherwise end. COBRA does not apply to employers with fewer than 20 employees. In Kansas, for those not eligible for COBRA, state law allows for continuation of coverage for 18 months.
However, COBRA and state continuation coverage can be expensive, since the former employer isn’t required to pay any part of the premium. Those who have lost employer-based health coverage may be eligible to access new tax credits to buy a more affordable individual or family policy through the Health Insurance Marketplace.
- + If a consumer has access to employer-based coverage, can an employer make the consumer wait before becoming eligible for benefits?
Yes, employers may require a waiting period before individuals become eligible for benefits. Under the ACA, this waiting period can’t be longer than 90 days. For more information, contact your employer’s human resources department or review the health plan’s Statement of Benefits and Coverage.
- + Can a consumer with access to employer-based coverage get a tax credit to buy a plan through the Health Insurance Marketplace?
A consumer who has access to employer-based coverage is free to buy a plan through the Health Insurance Marketplace. But tax credits to buy the coverage are only available if the employer’s plan isn’t affordable or doesn’t provide minimum value. If a consumer has access to employer-sponsored coverage that is affordable and provides minimum value, the consumer will not be able to get tax credits and cost-sharing reductions.
Coverage isn’t affordable if the cost of employee-only coverage under the employer plan costs the consumer more than 9.5% of the employee’s annual household income. The plan doesn’t provide minimum value if it pays for less than 60% of medical costs that the plan covers. HHS and IRS have developed a minimum value calculator at www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/mv-calculator-final-4-11-2013.xlsm.
An employer must provide a consumer with a minimum value written statement indicating whether the plan is above or below the 60% threshold. Consumers will receive this information together with the Statement of Benefits and Coverage when shopping for coverage through the Marketplace. An agent or navigator also should be able to help.
There’s more information on the IRS website at http://www.irs.gov/uac/Newsroom/Questions-and-Answers-on-Employer-Shared-Responsibility-Provisions-Under-the-Affordable-Care-Act.
- + If a consumer has employer-based coverage, can that consumer’s spouse get a tax credit to buy coverage through the exchange?
If the spouse can enroll in the consumer’s employer-based plan, and the plan meets the standards for adequacy (including that the premium to cover only the employee is less than or equal to 9.5% of household income), the spouse isn’t eligible for the tax credit. Contact the Health Insurance Marketplace to learn more.
- + Are health insurers required to sell their plans through the federal SHOP Exchange?
No. In 2014 two Blue Cross Blue Shield companies will be offering plans on the SHOP Marketplace in Kansas, one in the Kansas City area and the other throughout the rest of the state. No other insurers were required to offer plans on the SHOP Marketplace.
- + Must small employers offer health care insurance coverage to their employees?
No. The ACA doesn’t require small employers (defined as employers with fewer than 50 employees) to offer health insurance coverage to their employees. Small employers who want to provide coverage may be eligible for a tax credit to help make insurance more affordable.
If the employer does offer coverage, however, the coverage must meet ACA’s minimum standards for all insurance plans, as well as specific requirements that apply to the small group market, such as coverage of the essential health benefits.
In Kansas, the SHOP Marketplace for Small Businesses is a place where small employers can purchase coverage for their employees.
- + Must large employers offer health care insurance coverage to their employees? What about seasonal employees?
Under the ACA, if a large employer doesn’t offer affordable coverage that provides minimum value to full-time employees and their dependents (in proposed regulations defined as children under 26), and an employee gets a premium tax credit, the employer has to pay a penalty. Enforcement of this penalty has been delayed until plan year 2015. For employer-based coverage to be considered affordable, the premiums for the plan’s employee-only option must be less than 9.5% of his or her annual household income. To offer minimum value, the plan must pay at least 60% of the medical costs for services the plan covers. HHS and IRS have developed a minimum value calculator at http://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/mv-calculator-final-4-11-2013.xlsm.
Large employers are employers with 50 or more full time employees, including full-time equivalent (FTE) employees. Full-time employees are employees with 30 hours or more of service in a week. The number of full-time equivalent (FTE) employees is determined by adding the number of hours of service in a month for all part-time workers and dividing by 120 hours per month. Employers should seek professional advice in making this calculation.
Employers with a large seasonal workforce (such as agricultural workers hired for the harvest season or retail clerks hired for the holiday season) are given leeway under the ACA not to count seasonal employees to decide if they meet the definition of a large employer. If the employer has more than 50 full-time or FTE employees only during 120 or fewer days per year, the employer may not have to count those employees for those months. Professional advice in making this determination is also recommended.
There’s detailed information in the IRS proposed regulation: Shared Responsibility for Employers Regarding Health Coverage http://www.irs.gov/pub/newsroom/reg-138006-12.pdf.
- + ACA Requirement to Have Basic Health Care Coverage (Individual Mandate)
- + What is the individual mandate, and does that mean consumers must buy coverage through the Health Insurance Marketplace?
Under the ACA, starting January 1, 2014, consumers and their dependent children are required to have “minimum essential coverage” or pay a penalty, unless they fit within an exemption. This requirement is commonly known as the “individual mandate.”
Consumers may buy a plan through the Health Insurance Marketplace to satisfy the individual mandate, but they don’t have to. Other forms of health coverage that satisfy the requirement to have “minimum essential coverage” include most employer-sponsored plans, union plans, and enrollment in a government program such as Medicare, Medicaid, TRICARE or CHIP. Consumers can continue to use agents to buy insurance available in the market outside the exchange.
Some examples of health plans that do not meet the requirement of minimum essential coverage and do not satisfy the individual mandate requirement to have basic health care coverage are plans that cover only specialty or ancillary services (for example, hearing, chiropractic, etc.).
Check the website https://www.healthcare.gov/what-if-someone-doesnt-have-health-coverage-in-2014 for more information.
- + What happens if a consumer doesn’t satisfy the individual mandate?
Those who don’t have health insurance coverage or fit within an exemption will pay a tax penalty beginning in 2014. The penalty is set to increase each year as follows:
- In 2014, it will be the greater of $95 per adult or 1% of taxable income above the filing limit.
- In 2015, it will be the greater of $325 per adult, or 2% of taxable income above the filing limit.
- In 2016, it will be the greater of $695 per adult, or 2.5% of taxable income above the filing limit.
- After 2016, the tax penalty increases annually based on a cost-of-living adjustment.
The penalty starts after three months without coverage. For each month, the penalty due is 1/12 of the total annual penalty. The penalty for a child is half that of an adult. The total liability for a family is capped at 300% of the individual penalty. Only the first two children are counted to calculate the penalty.
- + Are there any exemptions to the individual mandate?
Yes. The ACA lists the following who aren’t required to pay a penalty if they don’t have health insurance coverage:
- Individuals and families whose income is low enough that they don’t need to file federal income tax returns,
- People who would pay 8% or more of the income for coverage, after taking premium tax credits and employer contributions into account,
- Individuals who have been uninsured for less than three months,
- People who are incarcerated,
- Individuals who aren’t lawfully present in the country,
- Members of federally recognized American Indian tribes and individuals who are not members of federally recognized American Indian tribes who can get services through an Indian health care provider,
- People who don’t have coverage because they belong to a religious group that objects to insurance coverage,
- People who are members of a health care sharing ministry, and
- People who experience hardship in obtaining coverage.
The Kaiser Family Foundation has put together a flowchart to help consumers understand who must have insurance: http://healthreform.kff.org/en/the-basics/requirement-to-buy-coverage-flowchart.aspx. There’s more information about who doesn’t have to pay a penalty if they don’t have health insurance in the IRS FAQ at: http://www.irs.gov/uac/Questions-and-Answers-on-the-Individual-Shared-Responsibility-Provision.
- + What if a consumer already has health insurance coverage?
Consumers with health insurance coverage don’t need to do anything, unless their insurance company sends them a notice that their health insurance doesn’t qualify as “Minimum Essential Coverage.” Consumers who get such a notice may have to pay a tax penalty for not having adequate health insurance coverage. To avoid this, contact the Health Insurance Marketplace at HealthCare.gov or 800-318-2596, or contact an agent or navigator.
- + Enrolling in Health Care Coverage: Where Can I Get Help?
- + Where do consumers go for help to choose and enroll in a plan?
Consumers should make a list of questions before they shop for a health plan. Consumers should gather information about household income and set a budget for health insurance. Consumers should find out if they can stay with their current doctors and pharmacy, and understand how insurance works – including getting an understanding of deductibles, out-of-pocket maximums and copayments.
The Kansas Insurance Department offers resources at InsureKS.org and Ksinsurance.org. There are a number of other resources from the Kaiser Family Foundation, Consumer Reports, the National Association of Insurance Commissioners, and theU.S. Department of Health and Human Services and the Department of Labor to help consumers understand how insurance works, the different insurance options, and what to consider when you buy coverage.
A new standard form called the Summary of Benefits and Coverage (SBC), and the companion Uniform Glossary that includes a set of uniform definitions, are also available for all health insurance plans. This information can help consumers compare different insurance options. Consumers can get the form and definitions through the Health Insurance Marketplace or ask the plan for it. A sample of the SBC and the Uniform Glossary are available here at insureKS.org.
If a consumer is eligible to buy coverage through the Health Insurance Marketplace, he or she can enroll through a link on insureKS.org, the Marketplace website at HealthCare.gov, by phone at 800-318-2596, or in person through agents, navigators or certified application counselors. More information on these programs is found elsewhere on this website.
There are three types of individuals trained to help consumers make decisions about health coverage.
- Insurance agents
Health insurance agents sell insurance coverage on behalf of one or more insurance companies. Health insurance agents are licensed by Kansas and receive continuing education related to their job. They can help educate consumers about health insurance policies, help consumers apply for coverage, and advise consumers about the type of health insurance coverage that best suits them and their family. Agents can sell consumers insurance plans in the market outside the exchange, as they always have.
Agents who want to sell policies through the Health Insurance Marketplace will have had extra training from the U.S. Department of Health and Human Services (HHS). They will have passed a test at the end of their training to sell insurance policies through the Health Insurance Marketplace. Consumers may wish to talk with more than one agent before making a decision on which plan to buy.
Navigators are individuals trained to help consumers understand the insurance policies available through the Health Insurance Marketplace and answer consumer questions about the Marketplace as well as insurance affordability programs, including Medicaid and CHIP. Navigators also can help educate consumers about their health insurance policy options and help them apply for coverage. Navigators get grants from the federal government and receive training on how to assist consumers. After training, they must pass a test and be certified by the federal government. Contact information for navigators can be found elsewhere on this website.
- Certified application counselors
Certified application counselors are to provide enrollment assistance to consumers. Certified application counselors receive and successfully complete comprehensive training. They, too, can help educate consumers about health insurance plans and help them complete an application for coverage. Examples of application counselors include staff at local community health centers, hospitals or other consumer non-profit organizations.
- Insurance agents
- + How are people who help consumers make decisions about health coverage paid?
Insurance agents may have an agreement with one or more insurance companies that will pay them if they enroll consumers in a health insurance policy consistent with state law. Other agents may work directly for an insurance company and be paid a salary by the company.
In Kansas, navigator organizations will get funding from the federal government. Individual navigators may be volunteers or in some cases staff paid by the organization. They don’t get enrollment-based reimbursement from insurance companies and are not allowed to charge a fee.
Certified application counselors may be paid staff of the organization for which they work but will not be paid through the Health Insurance Marketplace. They don’t get enrollment-based reimbursement from insurance companies and are not allowed to charge a fee. They may, however, receive federal funding through other grant programs or Medicaid, or from another source.
- + Where should consumers go with a problem enrolling in a plan through the Health Insurance Marketplace?
The Health Insurance Marketplace should be able to help consumers with enrollment problems. In particular, the Marketplace operates a call center to help answer consumer questions. The number for the call center is 800-318-2596. Insurance agents, navigators, and certified application counselors should also be able to help.
- + How will a navigator be able to help consumers with enrollment through the Health Insurance Marketplace?
In Kansas, navigators can help consumers log-on to the Health Insurance Marketplace. Consumers will log into their own Marketplace account. The navigator can help consumers as needed to complete the application. Consumers will be asked to enter the navigator’s Marketplace user identification number on the application to show that the navigator helped them.
The navigator can help consumers to compare qualified health plans and answer questions about health insurance policies in general. The navigator can answer questions from consumers about the differences in health plans and what they might mean for them, but the navigator CANNOT recommend or suggest which health plan would be best for consumers and their families. Navigators are not permitted to collect premium payments on behalf of an insurer or the Health Insurance Marketplace.
Navigators CANNOT sell, solicit, or negotiate a qualified health plan through the Marketplace. They CANNOT suggest that one health plan would be better for the individual than another.
- + How will the certified application counselor be able to help consumers with enrollment through the Health Insurance Marketplace?
In Kansas, the certified application counselor can help consumers log-on to the Health Insurance Marketplace. Consumers will log into their own Marketplace account. The certified application counselor can help consumers as needed to complete the eligibility application. Consumers will be asked to enter the certified application counselor’s Marketplace user identification number on the application to show that the counselor helped them.
The certified application counselor can help consumers to compare qualified health plans and answer questions about health insurance policies in general. The counselor can answer questions from the consumer about the differences in health plans and what they might mean to them (such as explaining deductibles or out-of-pocket limits), but the counselor CANNOT recommend or suggest which health plan would be best for consumers and their families.
The certified application counselor CANNOT sell, solicit, or negotiate a qualified health plan through the Marketplace. They CANNOT suggest that one health plan would be better for the individual than another.
- + Will small employers be able to use navigators to buy health insurance?
No. Navigators, by law, aren’t allowed to sell health insurance. Navigators are not permitted to collect premium payments on behalf of an insurer or the SHOP Marketplace. They are available to help small employers view plan options displayed on the SHOP website and can assist consumers with enrolling through the SHOP. Navigators can explain the parts of the plans offered through the SHOP Marketplace but CANNOT legally offer advice as to which plan is a better fit for the small employer. Only a licensed agent is qualified and allowed to offer this service.
- + Will consumers have to share their personal information, including their tax returns with an agent, navigator, or certified application counselor?
No, a consumer is not required to share personal information, including tax returns with an agent, navigator, or certified application counselor. If a consumer is completing the application on the Health Insurance Marketplace website with the help of an agent, navigator or counselor, the consumer should be able to fill out and submit their eligibility application without the agent, navigator or counselor in direct view of the application. Income figures obtained from the IRS will not be displayed during the application process, whether or not the consumer gets help filling out the application or does it independently. After training, agents, navigators, and certified application counselors must complete a privacy and security agreement before use of the Health Insurance Marketplace.
- + Will consumers have to share their account username and password with an insurance agent, navigator, or certified application counselor?
No. Agents, navigators, and certified application counselors shouldn’t ask for a consumer’s account username and password. If a consumer is asked to share a username or password, he or she should contact the Kansas Insurance Department at 800-432-2484 and discuss this with a consumer assistance representative.
- + What help should an insurance agent, navigator or certified application counselor give consumers if they or their dependents are eligible for Medicaid or CHIP?
An agent, navigator, or certified application counselor working with consumers eligible for Medicaid or CHIP is expected to refer consumers to KanCare, the state Medicaid and CHIP program. Agent, navigator, and certified application counselor training will include information about where to direct Medicaid or CHIP-eligible consumers.
- + Working with an Insurance Agent
- + How can consumers find an insurance agent to help them enroll in a plan?
The Kansas Insurance Department hopes to provide a link elsewhere on this website to help you find an agent who has been qualified to sell on the Marketplace.
- + What are the qualifications required for health insurance agents to participate in the Health Insurance Marketplace?
In Kansas, health insurance agents are regulated by the Kansas Insurance Department. Agents who can sell on the Health Insurance Marketplace also receive training and certification to sell on the Marketplace from the federal government. The insurance companies must appoint the insurance agents who sell their plans through Marketplace and agents can only sell for plans that have appointed them.
- + How will insurance agents be able to help consumers with enrollment through the Health Insurance Marketplace?
In Kansas, health insurance companies appoint agents to sell for them. Insurance companies will make sure the agent’s license is valid and registered with the Health Insurance Marketplace. The insurance agent can help consumers log-on to the Marketplace. Consumers will log into their own Marketplace account. The agent can help consumers as needed. The agent will then work with consumers to complete the application. Consumers will be prompted to enter the agent’s Marketplace user identification number and national producer number on the application to show that the professional helped them.
The agent can help consumers compare qualified health plans and submit the application. The insurance agent can answer questions from consumers about the differences in health plans and which plan would be best for consumers and their families.
- + Can small employers use licensed insurance agents to buy health insurance through the SHOP Marketplace for Small Businesses?
Yes, licensed insurance agents are available to help small employers compare and determine which health plan best meets their needs, like they do today. This is true whether they’re interested in buying coverage in the market outside the SHOP Marketplace or through it.
Licensed insurance agents will be able to compare plans in the market outside the SHOP against those offered through the SHOP Marketplace to decide where they can buy the best plan for them. Employers may wish to talk with more than one agent before making a decision on which plan to buy.
- + How can an insurance agent help a small employer interested in participating in the SHOP Marketplace for Small Businesses?
An insurance agent will be able to help any small employer, as they have in the past. The agent can help the employer decide which health insurance policy would be best for them, enroll employees in the plan, file health insurance claims, and understand the process of enrollment.
In the SHOP Marketplace, HHS expects that insurance agents will be in contact with employers both before and after enrollment, as they will be a primary contact for customer service issues.
- + What is the benefit of using an insurance agent to enroll in the Health Insurance Marketplace or the SHOP Marketplace for Small Businesses?
Whether consumers are individuals or small group businesses, the insurance agent can work with their needs and requirements. Agents have a working knowledge of the qualified health plans and their benefits. Consumers may be more comfortable sharing their medical wants and needs for a health insurance policy with an agent.
The agent may help individual consumers or small employers to create their account with the Health Insurance Marketplace or SHOP Marketplace if needed, but consumers, or a legally authorized representative, must create their own Marketplace username and password. Consumers shouldn’t share this information with third parties, including health insurance agents.
- + Will an insurance agent show consumers all of the plan choices available through the Health Insurance Marketplace?
If the consumer is using the Health Insurance Marketplace website with the help of an agent, all qualified health plan choices will be displayed. If the agent goes through an insurance company portal, all plans available through the Health Insurance Marketplace may not be shown but other plans available in the market outside the exchange, that aren’t eligible for the advance premium tax credit, may be shown. Consumers should ask the insurance agent if they’re being shown all of the plans available through the Health Insurance Marketplace and whether tax credits or cost sharing reductions apply to the plans they are looking at.
All agents must follow applicable Kansas laws, regulations, and Health Insurance Marketplace requirements, including standards related to relationships or appointments with insurance companies.
- + May an insurance agent continue to work with consumers once they’re enrolled in a plan through the Health Insurance Marketplace?
Insurance agents may continue to communicate with consumers after they’ve enrolled in a plan through the Health Insurance Marketplace, as long as the communications follow applicable laws and regulations.
The communications also must comply with the privacy and security standards adopted by the Health Insurance Marketplace which limit how an agent may use any information gained to provide help and services to qualified consumers.
HHS expects to issue more rules about privacy and security requirements.
- + Costs and Assistance With Costs
- + May consumers directly enroll in Marketplace coverage through insurers?
Yes, consumers may buy Health Insurance Marketplace coverage directly from an insurance company selling on the Marketplace. Consumers should make sure that the plan they are sold is a Marketplace plan, and that the insurer has an agreement to do direct enrollment through the Marketplace so they can get any tax credits or cost sharing reductions to which they are entitled.
Consumers enrolling directly through the insurance company portal may not see all plans available through the Health Insurance Marketplace.
- + How much will plans offered through the Health Insurance Marketplace cost?
There will be a wide variety of plans intended to fit different budgets, both through the Health Insurance Marketplace and in the market outside the exchange. Also, many consumers will qualify for the new premium tax credits, which will pay for part of their premium and help lower the cost of coverage. For a calculator to find a mid-point premium and an estimate of tax credits that may be available, go to insureKS.org. There you will also find a link to the Marketplace, or you can go there directly at HealthCare.gov. Finally, you can call 800-432-2484, or talk to a navigator, certified application counselor, insurance agent.
- + Will plans offered through the Health Insurance Marketplace have large out-of-pocket costs?
The health insurance plan choices feature a wide variety of out-of-pocket costs for consumers. But, the ACA requires that all plans limit consumers’ annual out-of-pocket costs for services to no more than roughly $6,350 for individuals and $12,700 for families in 2014. However, out-of-network services do not count toward these limits on annual out-of-pocket costs. There are separate out-of pocket maximums for stand-alone dental plans. Plans are also required to cover certain preventive services without cost-sharing.
These maximum out-of-pocket amounts will go up in future years.
Also, consumers whose incomes are below a certain amount may be able to buy a plan that features lower cost-sharing and lower out-of-pocket costs (copayments, coinsurance, and deductibles) without paying a higher premium. Check with the Health Insurance Marketplace, agents, navigators or certified application counselors to learn if you qualify.
- + Where can consumers go to learn if they’re eligible for help paying premiums or for Medicaid?
The Health Insurance Marketplace will determine eligibility for advance payments of premium tax credits and cost-sharing reductions. They will also assess Medicaid and CHIP eligibility and make a referral, if appropriate, to KanCare for a final determination.
Consumers who first apply to KanCare for Medicaid and are determined ineligible, will be referred to the Health Insurance Marketplace to see if they are eligible to purchase subsidized insurance.
- + Is there help for consumers who can’t afford coverage? Who’s eligible for tax credits?
The ACA created new premium tax credits and cost sharing reductions to help cut costs for eligible consumers who buy a plan through the Health Insurance Marketplace. The amount of the tax credit or cost sharing reduction depends on family size and income. Larger families and families with lower incomes get the most help. Tax credits and cost-sharing reductions are not available for individuals who are eligible for Medicaid, CHIP, Medicare, or qualifying employer-sponsored coverage. More information about tax credits is available at insureKS.org. Also for information on tax credits and cost-sharing reductions see www.healthcare.gov.
In Kansas, children may be able to get coverage through Medicaid or CHIP programs for which their parents aren’t eligible. Some families may find it more affordable to enroll their children in Medicaid or CHIP and have the parents buy coverage through the Marketplace.
- + How do tax credits to buy coverage through the Health Insurance Marketplace work?
Consumers who qualify for the tax credits can use them at any time – they don’t have to wait until they file their taxes. The advance payment is sent by the federal government to the insurance company that a consumer chooses and is used to reduce the monthly insurance premium. Consumers also have the choice to wait to use their tax credits until they file their taxes. They also can use just part of their estimated tax credit in advance.
Consumers who want to use their tax credit in advance need to be as accurate as possible to estimate how much income they expect to have in the coming year. If they underestimate their income and the tax credit is overestimated, they may have to repay part of their tax credits at tax time.
Consumers need to update the Health Insurance Marketplace during the year with any changes in income, family size (like having a baby), or employment (like getting a job where health insurance coverage is offered). The Health Insurance Marketplace will change the tax credit amount to reflect the new information. A consumer who forgets to update the Health Insurance Marketplace might owe money at tax time or realize they could have been using a larger tax credit amount in advance.
Consumers who don’t use the tax credit in advance don’t have to tell the Health Insurance Marketplace about any changes to their income, or employment during the year. They can get the tax credit on their tax returns.
Consumers may go to the Health Insurance Marketplace website through insureKS.org or HealthCare.gov, or call the Marketplace at 800-318-2596 for more information about tax credits. Agents, navigators, and certified application counselors, insurance agents are also able to give consumers information about the tax credit. There’s more information about premium tax credits on the federal website at www.healthcare.gov. Also see the premium and tax credit calculator at insureKS.org.
- + What is the Federal Poverty Level (FPL) and why is it important?
The federal poverty level is how the federal government defines poverty, and it’s used to decide who’s eligible for premium tax credits and reduced cost sharing on the Marketplace, as well as other programs like Medicaid and CHIP. FPL is based on a family’s annual income and family size. Premium tax credits may be available to Kansans who are at 100% to 400% of the FPL. Cost-sharing reductions may be available until a family’s income reaches 250% of the FPL.
- + Where can consumers find more information about Medicaid?
Contact www.kancare.ks.gov, for the Kansas Department of Health and Environment, the state Medicaid agency, with any questions or concerns about Medicaid and the ACA. Also, the HHS website has basic information about Medicaid posted at www.healthcare.gov.
- + Will consumers need to submit documentation of their income?
As much as possible, the Health Insurance Marketplace can use existing data sources or get information from various federal and state agencies, such as the IRS, to verify income. This is designed to ensure a high degree of program integrity and should reduce the amount of paperwork that consumers need to provide.
There will be situations in which income documentation is needed.
There are separate processes for income verification for premium tax credits and cost-sharing reductions, vs. Medicaid and CHIP. For premium tax credits, and cost-sharing reductions, as well as Medicaid and CHIP assessment, the Health Insurance Marketplace will use data from the IRS, the Social Security Administration, and other income data sources as a part of the verification process. In Kansas, the state KanCare program will make final Medicaid and CHIP determinations and will request any documentation needed.
- + Questions About Other Types of Coverage
- + What is available in the market outside the Health Insurance Marketplace?
In Kansas, health insurance coverage will continue to be available in the market outside the Health Insurance Marketplace that meets the requirement to have health insurance. However, if consumers want to take advantage of premium tax credits to help pay for part of their premiums, they must buy coverage through the Health Insurance Marketplace.
Consumers also can buy plans outside the Marketplace that don’t cover the essential health benefits, such as plans that cover only specialty or ancillary services (for example, cancer, hearing, chiropractic, etc.) Note, though, that these policies do not provide minimum essential coverage and will not satisfy the individual mandate. The NAIC has some resources discussing these types of plans:
You may want to contact an insurance agent for help.
- + If consumers already have coverage, may they buy separate policies for their children?
Consumers who already have coverage for themselves are eligible to buy a policy for a child through the Health Insurance Marketplace. The ACA requires that any health plan offered through the exchange must also be offered as a child-only plan at the same tier of coverage. Consumers may also be eligible for tax credits for child-only plans they buy through the Health Insurance Marketplace. Visit the Health Insurance Marketplace website through insureKS.org or at HealthCare.gov for more information about child-only plans available through the Health Insurance Marketplace.
Children who aren’t citizens or legal residents of the United States aren’t eligible for plans through the Health Insurance Marketplace. Consumers may be able to buy a child-only policy outside the Health Insurance Marketplace, either directly from an insurer or through an agent. For a list of licensed insurers in Kansas, visit the Kansas Insurance Department website at www.ksinsurance.org/consumers/companysearch.htm. A child also may be eligible for the Kansas Children’s Health Insurance Program (CHIP). To learn more about CHIP plans, visit www.kdheks.gov/hcf/medical_assistance/apply_for_assistance.html or www.insurekidsnow.gov.
- + ACA Medicare-related Questions
- + Who should consumers contact with questions about Medicare, Medicare Supplement insurance, or Medicare Advantage plans?
Medicare coverage, Medicare Supplement insurance, and Medicare Advantage plans are not available through the Health Insurance Marketplace. Consumers eligible for Medicare can purchase other coverage through the Health Insurance Marketplace, but are not be eligible for tax credits or cost-sharing reductions. Direct questions involving the ACA and Medicare, Medicare Supplement insurance, or Medicare Advantage Plans to Senior Health Insurance Counseling For Kansas (SHICK) www.kdads.ks.gov/SHICK/shick_index.html or call 800-860-5260. The federal government’s Medicare website, www.medicare.gov, also has more information about health reform and Medicare changes.
- + Is there anything that consumers and their dependents who are already on Medicare and employer-based coverage need to do because of the ACA?
Generally, there’s nothing consumers need to do because of the ACA if they’re already on Medicare and have employer-based coverage. If consumers have coverage through an employer, and that employer’s current benefits pay first and Medicare pays second, the ACA doesn’t change that.
If the employer changes the benefits that cover consumers or their dependents, then they will send consumers a notice about those changes. Consumers can ask their employers’ human resources department how those changes work with Medicare.
The Senior Health Insurance Counseling For Kansas (SHICK), 800-860-5260 or at http://www.kdads.ks.gov/SHICK/shick_index.html should be able to give consumers more information about how their existing coverage works with Medicare.
- + Is there anything that consumers and their dependents who are already on Medicare and have retiree coverage from an employer need to do because of the ACA?
The new federal law doesn’t change those benefits. Consumers should contact their employer’s human resources department for help. If they need more information about how Medicare and retiree benefits work together, they can contact the Senior Health Insurance Counseling For Kansas (SHICK) http://www.kdads.ks.gov/SHICK/shick_index.html or call 800-860-5260.
- + Will consumers with Medicare Supplement insurance be affected by the ACA?
- + How will consumers’ Medicare prescription drug “donut hole” be affected?
The ACA began closing the “donut hole” in 2011, and it’s expected that the “donut hole” will be closed by 2020. This means that Medicare beneficiaries whose prescription drug costs are greater than the Part D deductible will need to pay only a 25% coinsurance rate until their expenditures reach the catastrophic level. The “donut hole” is being closed by combining a 50% discount on the cost of brand-name drugs and a gradual increase in the share of prescription drug costs for both generics and brand-name drugs that Medicare pays, until a beneficiary only owes 25% of the total cost.
- + Will consumers with Medicare Advantage plans be affected by the ACA?
Yes. The ACA implemented quality incentives for Medicare Advantage plans. Also, it limited plans’ ability to require cost-sharing on certain high-cost services. So, some Medicare Advantage plans may cover more costs. The ACA also cut the Medicare Advantage program to line up payments for Medicare Advantage plans more closely with the traditional Medicare program. This may mean higher premiums or reduced coverage under some Medicare Advantage plans.
- + What about long-term care insurance policies?
The Health Insurance Marketplace doesn’t include long-term care insurance policies, and policies sold on the Marketplace don’t typically cover long-term care services. Insurance agents still sell long-term care insurance outside the exchange. See www.ksinsurance.org/ltc/ or the HHS website www.longtermcare.gov for more information about long-term care insurance.
- + Common Concerns About How the ACA Affects Consumers
- + Does the ACA eliminate private health insurance?
No, there is still private health insurance under the ACA. The ACA created health insurance exchanges where consumers can compare and shop for private insurance plans. The ACA also sets many new federal rules and protections that apply to private health insurance plans in each state.
- + Does the ACA include new rules about insurance premiums?
Yes, premiums may vary based on a person’s age, the area of the state in which the policy is sold, tobacco use, and family composition. Under the ACA, these are the only factors that an insurance company can use when they set premiums. Insurance companies can’t refuse to insure or charge higher premiums to consumers with medical problems. The ACA also reduces the difference in premiums charged for younger and older people and eliminates differences between premiums charged for men and women. Health plans in the individual and small group markets must, under the ACA, cover certain services.
To help make coverage affordable, many consumers who buy health insurance in the individual market will be eligible for premium tax credits, and consumers under age 30 or who can’t afford coverage may be eligible to buy catastrophic plans, which cost less.
- + Does the ACA address discrimination?
The ACA explicitly prohibits insurance companies from discriminating on the basis of age, disability, or expected length of life. The ACA regulations prohibit discrimination against individuals on the basis of race, color, national origin, sex, age, disability, gender identity, or sexual orientation. These nondiscrimination standards apply to the Exchanges and Exchange activities; issuers and insurance plans; and the essential health benefits, among others.
Also, health insurers must comply with any applicable state laws and regulations regarding marketing by health insurance issuers and cannot employ marketing practices or benefit designs that will have the effect of discouraging the enrollment of individuals with significant health needs in health insurance coverage or discriminate based on an individual's race, color, national origin, present or predicted disability, age, sex, gender identity, sexual orientation, expected length of life, degree of medical dependency, quality of life, or other health conditions.
Insurance companies won’t pay for services not covered by a plan, such as care that isn’t medically necessary. However, consumers have the right to ask their insurance company to reconsider a decision to deny coverage and, after that, consumers have the right to an independent external review of the decision.
- + What are the income tax implications of the ACA?
The Kansas Insurance Department does not interpret or enforce obligations under the tax code. Consumers can contact the internal revenue service or their tax advisor for information.
- + What does the health plan “accreditation status” information on the exchange web page mean?
Accreditation is a comprehensive process by private, non-profit organizations that review how well health plans deliver care and how they work to improve the delivery of care over time. Health plans offered through the Health Insurance Marketplace must be certified by a recognized accrediting body, such as URAQ at www.urac.org and the National Committee for Quality Assurance (NCQA) at www.ncqa.org.
Part of a health plan’s certification requires that the plan be accredited by a recognized accrediting entity within a timeframe set by the Health Insurance Marketplace. Accreditation ensures that the plans sold on the Health Insurance Marketplace meet minimum quality, access, non-discrimination and marketing standards in the ACA.
- + What does the health plan “consumer experience” information on the Health Insurance Marketplace web page mean?
Consumer experience ratings come from surveys that ask individuals who have coverage through a health insurance plan how they like the plan. These individuals also rate the quality of the medical care they receive and the accessibility of the medical care that they need.
- + What appeal rights do consumers have?
Consumers have a right to appeal an unfavorable coverage decision by their health insurance company. Insurance companies must give consumers owning an individual policy a first-level internal appeal, administered by the company, and then a second-level external review administered by an independent third party. For group policies, the insurance company may require two levels of internal appeals before the external review. For more information about how to appeal a health insurance company’s unfavorable decision, contact the Kansas Insurance Department at 800-432-2484.
Consumers can also file complaints when claims are denied, or when they believe that their health insurance company isn’t properly following the legal appeals process. To reach the state insurance department, consumers can call 800-432-2484 or visit ksinsurance.org/consumers/complaint.htm.
Also, if a consumer is dissatisfied with an eligibility decision made by the Health Insurance Marketplace there will be an appeals process. The consumer can contact the Marketplace for more information.
- + Where do consumers file a complaint for a product sold through the Health Insurance Marketplace? What about plans sold in the market outside the Health Insurance Marketplace?
Consumers should first contact the insurance company with any complaint about benefits or services not being received from an insurer on or off the Marketplace. If consumers aren’t satisfied, they should contact the Kansas Insurance Department for help with questions or complaints.
To find out more about filing complaints, contact the Kansas Insurance Department at 800-432-2484 or ksinsurance.org/consumers/complaint.htm.
- + If consumers apply for coverage in the market outside the Health Insurance Marketplace, are there different rules for open and special enrollment?
In Kansas, insurance companies will have policies for sale in the market outside the Marketplace. Enrollment periods outside the Health Insurance Marketplace generally are the same as enrollment periods through the Marketplace. Contact the Kansas Insurance Department at 800-432-2484 or an insurance agent for more information about enrollment.
- + Questions Involving Special Circumstances and Populations
- + What insurance is available for consumers with chronic conditions? Will the new law help them get better coverage?
Yes, under the ACA insurance companies can’t refuse to insure consumers with chronic or preexisting medical conditions, exclude coverage for preexisting conditions, or charge higher premiums because of a health or medical condition. The ACA also requires insurance companies in the individual and small employer markets to offer more comprehensive coverage than is currently available for some people with chronic illnesses. It prohibits discrimination on the basis of age, disability, or expected length of life. Coverage for these benefits is available from the beginning of the policy coverage period, without a waiting period, even if there was no prior coverage.
- + Does coverage provided through a religious health care sharing ministry satisfy the individual mandate?
The ACA includes an exemption from the individual mandate for individuals who are members of a health care sharing ministry. This type of organization is not licensed as an insurance company and doesn’t guarantee payment of health care claims or expenses.
- + Are undocumented immigrants eligible for coverage through the Health Insurance Marketplace or for tax credits?
No, undocumented immigrants aren’t eligible for coverage through the Health Insurance Marketplace or for advance premium tax credits. They may be able to buy coverage from an insurance company or through an agent off the Marketplace.
- + What options are there for consumers with children who aren’t citizens or legal residents?
Consumers won’t be able to buy a policy through the Health Insurance Marketplace for children who aren’t citizens or legal residents, but they may be able to buy coverage from an insurance company or through an agent off the Marketplace.
- + Are incarcerated people eligible for coverage through the Health Insurance Marketplace or tax credits?
No, incarcerated people aren’t eligible for coverage through the Health Insurance Marketplace. They also aren’t eligible for advance payments of the premium tax credits. However, consumers who are incarcerated pending the disposition of charges still are eligible.
- + Are tribal members eligible for coverage through the Health Insurance Marketplace or tax credits?
Yes, members of federally-recognized Indian tribes may buy coverage through the Health Insurance Marketplace. They’re also eligible for premium tax credits. And, because of the federal government’s special trust responsibility, members of federally-recognized Indian tribes are eligible to receive benefits not available to others, such as plans with no cost-sharing under certain circumstances and special enrollment periods. For more information, go to https://www.healthcare.gov/if-im-an-american-indian-or-alaska-native-what-do-i-need-to-know-about-the-marketplace/.
- + Questions About Medical Loss Ratio (MLR)
- + What is the “Medical Loss Ratio” (MLR) requirement?
The ACA’s “medical loss ratio” (MLR) requirement is that health insurers must spend at least a certain percentage of consumers’ premium dollars on direct medical care and health care quality improvement. That limits the amount of premium dollars spent on administrative expenses, such as overhead, marketing, salaries, and profit.
The ACA requires that health insurance companies providing coverage in the large employer market (usually 50 or more employees) must spend at least 85% of premiums on direct medical care and quality improvement activities. Health insurers who provide coverage in the small employer market (usually fewer than 50 employees) and individual market must spend at least 80% of premiums on direct medical care and quality improvement activities.
- + What is an MLR Rebate?
Under federal law, if a health insurer doesn’t meet the MLR target of premiums spent on direct medical care or quality improvement activities, then that health insurer must give consumers or employers a rebate for the amount of premiums they collected that was greater than the target.
- + Questions About Whether a Plan Is Legitimate
- + Why is this a time to especially be on guard against health insurance fraud?
The health insurance reforms now underway during ACA implementation are bringing big changes. Few Americans are aware of all of the ACA requirements. Unfortunately, experience shows that during times of big change or confusion, fraud flourishes.
As the ACA is phased-in, con artists posing as representatives of the federal government or as legitimate insurance agents or navigators might try to steal consumers’ money or identity through various health insurance schemes. For instance, criminals might try to convince consumers to reveal personal information to receive a fictitious “national health insurance card” or a new Medicare card under the ACA. Or they might try to sell consumers health insurance policies that are fake and worthless.
- + Can consumers and employers get help from their current insurance agent or insurance company to buy health insurance coverage through the Health Insurance Marketplace?
Yes. Working with individuals known personally or known to be working for legitimate organizations is a dependable way to avoid fraud.
- + If consumers don’t have a relationship with an insurance agent or company, where should they go for help?
When consumers contact the Health Insurance Marketplace they’ll have the option to contact a navigator specifically trained to help them choose the best health coverage or insurance product for their needs. Certified Application Counselors also will be available through trusted community health centers, other health care providers, hospitals, or many social service agencies.
- + How do consumers know that the insurance they’re being sold is what they need to comply with the law?
When consumers are buying a plan because the ACA requires them to have health insurance coverage, consumers should be sure they’re given a “Summary of Benefits and Coverage” (SBC). This form also should be available through the Marketplace at HealthCare.gov. The SBC will indicate whether a particular insurance plan provides “minimum essential coverage.”
- + If someone comes to consumers’ homes, calls consumers out of the blue, or sends email to offer consumers health insurance coverage at a terrific price, how will consumers know whether the person and the health insurance coverage are legitimate?
Remember this simple formula: STOP – CALL – CONFIRM.
- STOP – Consumers should ask the person for identification and a phone number where they may be reached later. If the person refuses to give this information for any reason, or tries to pressure them into signing any document, consumers should immediately hang up, close their door, or walk away.
Consumers should NOT volunteer their Social Security number or a credit/debit card number to anyone unless they personally know the individual. Likewise, they should NOT sign any paperwork or write a check.
- CALL – Consumers should then contact the Kansas Insurance Department or the Health Insurance Marketplace. The insurance company or agent must be licensed with the Kansas Insurance Department before they can sell coverage and counsel consumers about the Health Insurance Marketplace. The department also will have information about federally registered navigators.
- CONFIRM – Consumers always should confirm that the company or agent offering insurance coverage, or the navigator trying to provide assistance, is authorized to provide information or coverage before they sign any documents or give any personal information.
Remember that if something seems too good to be true, it usually is.
- STOP – Consumers should ask the person for identification and a phone number where they may be reached later. If the person refuses to give this information for any reason, or tries to pressure them into signing any document, consumers should immediately hang up, close their door, or walk away.