Health Exchanges: R.S.V.P.

By Kevin A. Luss

    Who: You and all of the various stakeholders in the health care delivery, consumer, and insurance fields are impacted by the federal Patient Protection and Affordable Care Act. All of us will continue to be affected by this law, whether through changes in the way you purchase health insurance or in the many new reports required of your employer by the Department of Labor. Individuals, employers of all sizes, insurance companies, your family doctor, and every single department of your local and regional hospitals from recordkeeping to patient protocol are changing to meet the requirements of this act.

    When: The Patient Protection and Affordable Care Act was a United States statute signed into law by President Obama in March 2010. We have, in fact, been living with the Affordable Care Act as the law of the land for over three years now. The state exchanges, or health insurance marketplaces, are just one of the many components of the law that will go into effect on Jan. 1. They are unquestionably the most visible and the law’s primary mechanism to enroll the nation’s uninsured. Open enrollment for New York State’s health plan marketplace is scheduled to begin on Oct. 1, for the effective date of Jan. 1.

    Action Item: At this time, the only mandate is for individuals who do not currently have health insurance. If you are an early retiree and not eligible for Medicare, an employee not eligible for your company’s group health plan, or an unemployed person with no health insurance, for instance, you are now required to purchase health insurance. The fine for not purchasing coverage is the greater of $95 or 1 percent of your family’s annual income. The dollar amounts and percentages are scheduled to increase quickly over the next three years. There is a grace period until March 1 to buy coverage in this first year of enrollment.

    Where: The Web. is the address of the Web site set up by the New York State Department of Health. This is the official site for the state’s health plan marketplace, with its newly branded name of “NY State of Health.” (And is that not a perfect segue for a Billy Joel ad campaign?)

    Your Current Insurance Broker. New York, in particular, is committed to allowing you to use your current health insurance broker when buying plans on the state marketplace. There is no added cost in using your current representative, but you must make sure that he or she is certified with whichever of the two exchanges you will be enrolled in.

    Suffolk County Navigators. In Suffolk County there are three officially deemed state health care exchange navigators. These navigators are charged with providing advice and assistance to consumers who are interested in learning more about the New York’s insurance marketplace. While these navigators are unlicensed and prohibited from recommending particular plans or companies, they may serve an important educational role in shepherding uninsured people toward the marketplace. The Nassau-Suffolk Hospital Council, the Community Service Society of New York, and Public Health Solutions are Suffolk County’s three navigators.

    Whether you choose to access the Web site, an agent certified in the New York exchanges, or a health care navigator, it is imperative that you assess the accuracy of the information that is being shared as well as its current validity. Timelines and specific components of the legislation such as the “employer mandate” are being delayed or amended on a weekly basis. The political climate is unsettled and the potential for further changes is strong. Make sure you take your time and be as mindful with this purchase as you would with any other high-dollar purchase.

    What: The Affordable Care Act requires states to create exchanges, a competitive marketplace for individuals and small businesses to buy health insurance. Exchanges, which must be operating in states by Jan. 1, will be the main way that people gain coverage under the act. It’s estimated that by 2019 exchanges will serve as a gateway for an estimated 29 million people to find their insurance — 1.1 million in New York State alone. While the exchanges will be a major way people get insurance, the majority of people over all will continue to get coverage from their employers, just as they do now.

    The New York State exchanges will offer plans based on four tiers, or “metallic” levels, i.e., Platinum, Gold, Silver, and Bronze, and a Catastrophic Plan, that are expected to cover costs at approximately 90 percent, 80 percent, 70 percent, and 60 percent, respectively. The prices for these plans have been released but not the supporting plans of benefits or physician-hospital network descriptions.

    On the individual exchange there will be a vast array of plans from which to pick. The choices will include well-known insurers such as Oxford and Empire Blue Cross-Blue Shield. There will also be never-before-seen entities like Oscar, which is an all-online health plan started by three young New York City hedge fund managers.

    At present, the only insurer who will be offering plans on the SHOP, or Small Business Health Options Program — created for businesses of 50 employees or fewer — will be Oxford Health Plans. Again, we have the prices, but the supporting coverage has not yet been released by the New York State Department of Financial Services and the Department of Health.

    How: In my opinion, seeking out the advice of an expert in this ever-changing field is critical. Health insurance brokers, consultants, attorneys, and certified public accountants can either provide advice or direct you to one of their trusted resources for current information. Be wary of those who purport to be experts in an attempt to capitalize on the sense of panic that is beginning to typify the workplace.

    If you offer your employees health coverage through the small-business marketplace, you may be able to use the Small Business Health Care Tax Credit. As of 2014, NY State of Health will be the only place you will be able to access this tax credit. Your C.P.A. is the only person certified to provide you with tax advice, while your broker can assist with resources to address this as well.

    Conclusion: As I sit and type this it is difficult for me to fathom that this will all be up and running in a week, but this is the intention of New York State and its 49 counterparts. In the absence of further delays or changes, the majority of us are going to be impacted in some way by the launch of the health care exchanges next week. Stay tuned to sources of local news and your trusted advisers as this historic public policy is implemented, and you should be well prepared for the coming changes.

    Kevin A. Luss is the president of the Luss Group, an insurance and financial planning firm in Southampton.