AFFORDABLE CARE

1. Navigating the Federal Marketplace AFFORDABLE CARE PENALTY AHEAD

2. Learning Objectives • Highlight the basics of the Affordable Care Act (ACA). • Explain common health insurance terms and concepts. • Identify approaches for assisting consumers with Marketplace applications. • Highlight best practices for outreach and enrollment strategies in health centers and other consumer assistance entities. • Identify strategies for assisting consumers with maintaining health coverage and avoiding the individual shared responsibility payment. • Emphasize the Navigator’s responsibilities post-open enrollment season

3. Basics of the Affordable Care Act (ACA) • The Patient Protection and Affordable Care Act (ACA) was passed on March 23, 2010 under the Obama administration • This created: • A new avenue to purchase health insurance coverage—Marketplace, or Exchange • Accessed through www.healthcare.gov • Managed by the U.S. Centers for Medicare & Medicaid Service (CMS) • Tax subsidies to help individuals afford coverage • Tax penalties associated with not having health insurance • Restricted period of the year when coverage is available for purchase

4. Basics of the Affordable Care Act (ACA) • Eliminated the ability for insurers to deny coverage based on health status • Coverage is guaranteed available and renewable • Changed requirements around cost-sharing and the comprehensiveness of offered benefits

5. Types of Assisters

6. The Navigator’s Responsibilities To be an efficient Navigator, one must understand certain health insurance concepts and have the ability to explain terms to consumers.

8. Health Insurance Markets

9. Health Insurance Cost

10. Health Insurance Cost Out-of-pocket Maximum Increases for 2015

11. Test Your Knowledge The ___________________is the maximum amount the enrollee can expect to pay for services in any given year, while the __________________is the base amount that a member pays for services prior to their health insurance paying for their coverage.

12. Test Your Knowledge The ___________________is the maximum amount the enrollee can expect to pay for services in any given year, while the __________________is the base amount that a member pays for services prior to their health insurance paying for their coverage. out-of-pocket maximum deductible

13. Rating Rules • The ACA limits the factors that major medical plans can base the price of their plan on to age, location and tobacco use • Rating for Age • Limited to a 3 to 1 ratio—Older adults may be charged no more than 3 times the premium as younger adults

15. Rating Rules • Rating for Location • The ACA allows insurers to adjust their premiums depending on enrollee’s location • There are 17 rating areas in Indiana • Rating for tobacco • Up to 1.5 times the premium for individuals that use tobacco • Tobacco use defined as use of any tobacco product on average four or more times per week over the past 6 months • At no point may a rate increase for tobacco based on age contradict the 3 to 1 rating limit

16. Help Paying for Health Insurance Two programs to help qualified individuals afford health insurance and cost-sharing for health services: • Premium Tax Credit (PTC) • Lowers the monthly premium amount • Can be used to purchase any plan on the federal Marketplace • Can be paid directly to insurer (Advanced Payment) • Available to consumers 100-400% of the Federal Poverty Level (FPL) • Cost-Sharing Reduction Program (CSR) • Reduces out-of-pocket costs for consumers • Increases the Actuarial Value (AV) of health coverage plans for low-income consumers (below 250% FPL) • Consumer must select at least a Silver plan

17. Who is eligible for the PTC and CSR? • Individual must be a citizen, national or legal resident of the U.S. • Not currently incarcerated • Meet income requirements • Meet tax-based requirements • Plan to file a federal tax return • If married, plan to file jointly • Not eligible to be claimed as a dependent on someone else’s tax return • Lack access to Minimum Essential Coverage (MEC) OR Have MEC available, but the premium amount is ≥ 9.5% of household income or does not provide minimum value (at least 60% actuarial value)

18. How to get Help Paying for Health Insurance 2 1 Apply for health insurance on the Marketplace Provide information about income, household size, access to coverage, etc. 3 Marketplace determines eligibility for Financial Assistance 6 5 File Taxes - If married, must file jointly 4 Report any changes throughout the year (e.g. lose job or have baby) Choose a health plan

19. Premium Tax Credit (PTC) 1. Full Advanced Payment 2. Partial Advanced Payment 3. Claim Later • Reduces premium costs & likelihood of PTC overpayment • Consumer bears more of the premium cost immediately than if full advancement payment is taken • Reduces monthly premium cost • Paid in full to insurance carrier • If income increases during the year, consumer may owe some or all of the PTC back at tax filing • Ensures that PTC is not overpaid and that consumer will not owe at tax filing • Consumer bears the full cost of the premium immediately

20. Claim Later Partial Advanced Payment Full Advanced Payment

21. Premium Tax Credit (PTC) If an individual or family falls between 100-400% of the Federal Poverty Level (FPL), then they will generally qualify for a PTC. (Based on the 2014 FPL)

22. How is the Premium Tax Credit Calculated? - = Cost of a Benchmark Plan Expected Family Contribution Advanced Premium Tax Credit Set on a sliding scale based on income; varies from 2% of income at 100% FPL to 9.5% at 400% FPL. “Fills the gap” between what a family is expected to contribute to health insurance and the cost of a benchmark plan. The cost of the second lowest cost Silver plan adjusted to reflect selected characteristics of the family, such as age and size.

23. Premium Tax Credit (PTC) Required Premium Contribution *This estimated contribution is for the second lowest-cost Silver plan available on the federal Marketplace; estimated annual contribution could change based on plan metal tier selected

24. Premium Tax Credit (PTC) Calculation Example In Marion County, IN, the estimated annual premium for a 35-year old non-smoker’s second-lowest Silver plan is $3,912 annually* for 2014. The PTC amount is calculated by taking this total premium cost and subtracting the required contribution. *Source: Indiana Department of Insurance

25. Cost-Sharing Reductions (CSR) Who is eligible? • Individuals who meet all requirements for the PTC AND • Have household income between 100% to 250% of the Federal Poverty Level (FPL) AND • Enroll in a Silver plan (70% Actuarial Value) on the federal Marketplace

26. Cost-Sharing Reductions (CSR) Benefits: • Increase the Actuarial Value (AV) of health coverage plans for low-income consumers • Reduce out-of-pocket costs for consumers • Offered in addition to PTC • Qualifying individuals do not have to apply for CSR separately

27. Cost-Sharing Reductions (CSR) Based on 2014 FPL

28. Test Your Knowledge To be considered for cost-sharing reductions, an individual must enroll in a _______________ plan. The ________________ is an insurance affordability program that can be applied to any plan on the Marketplace to lower a monthly premium.

29. Test Your Knowledge To be considered for cost-sharing reductions, an individual must enroll in a _______________ plan. The ________________ is an insurance affordability program that can be applied to any plan on the Marketplace to lower a monthly premium. Silver Premium Tax Credit

30. HEALTH INSURANCE PLANS

31. What’s Offered on the Marketplace? • The Marketplace offers four categories of Qualified Health Plans (QHPs), known as “Metal Levels” • Distinguished by the share of health care costs QHP are expected to cover • Actuarial Value (AV) The percentage that insurance companies will pay on average for the health services consumers use • Other Plan Options • Catastrophic plans • APTC cannot be applied • Stand-alone plans such as dental

32. Actuarial Value and Metal Tiers Lower Premiums Higher Premiums Higher Consumer Cost-Sharing Lower Consumer Cost-Sharing 60% 70% 80% 90% Percent of Total Cost of Care Covered

33. Actuarial Value and Metal Tiers

34. Actuarial Value and Metal Tiers

35. Test Your Knowledge • A plan in the ____________tier will have the lowest premium amount and ___________cost-sharing amount. • A plan in the ____________tier will have the _____________ premium amount and the lowest cost-sharing amount.

36. Test Your Knowledge • A plan in the ____________tier will have the lowest premium amount and ___________cost-sharing amount. • A plan in the ____________tier will have the _____________ premium amount and the lowest cost-sharing amount. bronze highest platinum highest

37. The Individual Mandate • Also called the Individual Shared Responsibility Requirement– Affordable Care Act (ACA) condition requiring individuals to maintain health coverage for themselves and their dependents • Health coverage must be considered Minimum Essential Coverage (MEC) as determined by the federal government • All Qualified Health Plans (QHPs) on the Marketplace must cover certain benefits • There are 10 Essential Health Benefits (EHBs) set for 2014 and 2015 which must be offered by health plans • Will change in 2016

38. Minimum Essential Coverage (MEC) • Coverage that is considered comprehensive health insurance under the ACA • Coverage for one day in the month is considered to be coverage for the entire month

39. Minimum Essential Coverage (MEC)

40. Essential Health Benefits (EHBs) Emergency Services Hospitalization Ambulatory Patient Services Maternity & Newborn Care Mental Health Services Prescription Drugs Rehabilitative Services Laboratory Services Pediatric Services Preventive & Wellness Care

41. Qualified Health Plans (QHPs) • Plans sold on the Marketplace must be certified as QHPs • QHPs sold on the Marketplace must • Provide Minimum Essential Coverage (MEC) • Cover Essential Health Benefits (EHBs) • Meet Actuarial Value (AV) • Meet provider network standards • QHPs are the only plans that an individual can purchase that are eligible for the Premium Tax Credit (PTC) or Cost-Sharing Reductions (CSRs)

42. Catastrophic Coverage • What is catastrophic coverage? • Plans with high deductibles and lower premiums • Consumer pays all medical costs up to a certain amount • Includes 3 primary care visits per year and preventative services with no out-of-pocket costs • Protects from high out-of-pocket costs • Who is eligible? • Young adults under 30 • Those who qualify for a hardship exemption • Those whose plan was cancelled and believe Marketplace plans are unaffordable NOTE: People who enroll in catastrophic health plans are not eligible for PTC

43. Grandfathered Plans • Health plans in existence prior to the passage of the ACA and do not have to comply with some provisions related to: • Benefits • Cost-sharing • Pre-existing condition exclusions • Annual maximum • Plans may only maintain grandfathered if they do no make substantial changes to their policies • Individuals offered grandfathered coverage through an employer may choose to not accept the coverage and purchase coverage that meets ACA requirements instead

44. Excepted Benefit Plans • Plans that cover a specific service or condition and do not provide comprehensive health coverage • Not subject to many of the ACA market reforms • Most common is stand-alone vision • Stand-alone dental plans are the only excepted benefit plans offered on the Marketplace • Not offered in the metal tier levels of QHP • Subject to a $700 maximum out of pocket amount for a single individual and $1,400 for family • May be purchased using the APTC • Not eligible for cost-sharing reductions

45. Shared-Responsibility Payment • Those who do not have MEC or an exemption will be required to pay a shared-responsibility payment to the IRS upon tax filing

46. Test Your Knowledge Stand-alone ________ plans are the only excepted benefit plans available on the Marketplace, while the most common is stand-alone __________ plans.

47. Test Your Knowledge dental Stand-alone ________ plans are the only excepted benefit plans available on the Marketplace, while the most common is stand-alone __________ plans. vision

48. Assisting Consumers with Marketplace Applications

49. Screening Consumers • Introduce yourself as a Navigator • Explain your role and how you can help • Reveal any potential conflicts of interest • Assess their knowledge • Are they familiar with the Affordable Care Act? Individual Mandate? Premium Tax Credits? • Ask about • Household income • Household size • Plans to file taxes • Answer any questions • Direct them to additional • resources if necessary

50. Screening Consumers • To purchase coverage on the Marketplace, individuals must: • Be a United States citizen or legal resident • Reside in the state they are applying in • Not be incarcerated • You can help individuals compare plans based on: • Quality • Covered benefits • Covered providers • Expected cost-sharing level