Slated for the year 2014, new laws pertaining to healthcare will allow all consumers and small businesses to compare and purchase healthcare plans through a State Marketplace. Millions of Americans will be eligible for tax credits and financial aid to help pay for their health insurance policies. Marketplaces, or Exchanges, will grant citizens in every state access to new open markets run by the State, Federal government or a State and Federal run hybrid called a State Partnership Exchange, depending on which one the State has chosen.
Beginning January 1, 2014, Americans will have access to insurance regardless of pre-existing conditions. The Obama administration crafted the Patient Protection and Affordable Care Act (PPACA) intending to foster a more competitive market place system, resulting in lower rates for the consumer. By establishing a 3:1 cap on age-based premiums, the Administration hopes that no older American will pay more than three times as much as a younger American. Their goal is an affordable plan for all, regardless of age or health.
Many states have already received federally subsidized grants as financial aid to help fund and establish the new Marketplaces. The states in those situations elected to independently run their own Marketplaces. The Federal government will establish and operate Marketplaces in the states that chose not to establish their own. All Marketplaces will launch Open Enrollment in October 2013.
Tax subsidies will make the plans offered through the Marketplace more affordable for some people with lower incomes. The state of California offers an online calculator that allows residents to enter in their household income, age and number of dependents to get an estimate of their costs at www.coveredca.com. Residents that don’t qualify for a Subsidy due to higher income can still enroll in an Exchange plan but will not receive cost reductions. Residents can also apply for coverage outside of the Marketplace. Since private insurance carriers cannot deny coverage or increase rates due to health conditions or expensive medications, they will have the capability of competing with the Exchange for business.
Some Small businesses may find better or more affordable plans through the Marketplace also. Increasing tax subsidies, ease of administration and more plan options for employees may make the State Exchange a better option for some employers. Private insurance carriers will also offer plans that may alternatively appeal to other employers. A good Broker, Certified with the State Marketplace, can assist employers in weighing their options. Brokers will need to consistently educate themselves on the ever-changing nuances of PPACA in order to effectively advise their clients. Several changes in the law have taken place since it’s approval in 2010. Changes will continue to occur as the dust settles. If you need a trusted advisor throughout the changes, please contact J.S. Tucker Insurance today.