In just more than two months, on October 1, open enrollment in
Health Insurance Marketplace, also known as the health
insurance exchange, will begin. Insurance coverage through the
health exchange will begin as early as January 1, 2014. This is one
of the pivotal pieces of the Patient Protection and Affordable
Care Act (ACA), and it's a little disconcerting that so few
people know even a little bit about what the health exchange is or
how it will work.
16 states, plus Washington, D.C., have chosen to expand health
coverage to those who currently count themselves among the
uninsured through a state-based exchange. As for the rest, 27
states elected not to create their own exchange and thus
defaulted to a federal exchange, and seven states have opted for a
Partnership Exchange, which enables the state to carry out
certain functions of a federally funded exchange.
But What is it and How Does it Work?
What does the health exchange mean? In Maryland, specifically,
16 percent of the population lives in poverty. Furthermore, 13
percent of our population is currently uninsured, and 10 percent of
children-or approximately 138,300 children-currently have no health
Through the state-based health exchange in Maryland, which is
Health Connection, 108,000 adults living in Maryland at 138
percent of the federal poverty level will be able to receive health
care coverage. In addition, the Maryland Health Benefit Exchange
will extend health care coverage to
448,000 state residents who are currently without coverage.
Maryland Health Connection will also help an additional 180,000
residents gain quality health care insurance that before was out of
So how does it work? Insurance plans available for purchase in
the exchange are offered by private insurance companies. Plans may
be purchased by anyone who does not receive health insurance
benefits from their employer (either because the company does not
offer them or because they decide not to receive coverage from
their employer).These plans are required to all cover the same
essential health benefits-the same benefits required of all
insurance providers. These essential benefits include emergency
services, hospitalization, maternity and newborn care, prescription
preventive and wellness services, and a handful of others.
Meanwhile, part-time employees who are not offered health
insurance coverage through their employer may qualify for
lower premiums and lower out-of-pocket costs based on the size
of their household and their income. Once the exchange opens in
October, individuals can complete an application to find out
whether they are eligible for any low-cost insurance options.
According to healthcare.gov, in 2014, an
individual making up to about $45,000, or a family of 4 making up
to about $94,000, may qualify for these lower costs.
What About the Fine for not Having
Starting in 2014, everyone will be required to purchase health
insurance or pay a penalty. The fee will start out at 1 percent of
a person's income or $95, whichever is higher, for next year.
Although not necessarily a cost-prohibitive penalty at first, the
fine will increase each year. By 2016, it will be 2.5 percent of a
person's income or $695, again, whichever is higher-at which point
the fine becomes more substantial for many people. Open enrollment
ends on March 2014, so if a person has not purchased health
coverage through the exchange by that date, they will have to wait
for the next enrollment period.
Understanding health insurance benefits has never been an easy
task-even for the most educated among us. And the health exchange
is no exception. The Obama administration is attempting to get the
word out, and various organizations have strategies in place to
help inform people about the looming open enrollment date. As
part 2 of this series, MMG has partnered with
Mobile Commons to offer a text messaging program that assists
local, state, and federal organizations provide education about the
exchange, including how to enroll.
If you don't currently have health insurance, I ask you to spend
some time to familiarize yourself with your options, and once the
exchange opens, do some comparison shopping to make sure you and
your family are covered. It's a lot of information, and it can be
confusing, but the payoff will be worth it.
This is part 5 in the Healthyist's series on the Affordable
Care Act (ACA). For more of our take on the ACA, read part 1,
Health Reform: You Think You Know but You (Probably) Have No
Idea, part 2,
Digital Health Features Prominent in Health Reform Changes,
Will a Little-known ACA Provision Give Clinical Trials a
Much-needed Boost?, and part 4,
Health Literacy: Reading Between the Lines of the Affordable Care