In the 2009 Richland County census, 82 percent of Richland County workers earned private wages or salaries, meaning most of these employees could currently be under health insurance plans set up by their employers.
What this also means is that many in Richland County are going to be eligible for government subsidies. Whether this is a good or bad thing is a matter of opinion.
Here is a skeletal explanation: if an employer has more than 50 employees, and they meet full-time requirements (30 hrs/week), employers must offer a health care plan. Furthermore, if the plan offered is considered unaffordable, or over 9.5 percent of the employee’s salary, the employee must purchase health care through the Health Insurance Marketplace. If the employer does not offer a plan starting in 2015, the employer will be fined $2,000 per employee.
Brian Thompson of Thompson Benefit Solutions said of the mandate, “Monthly premiums for employers are going to continue to increase, and when they do, employers will have to make a decision on whether they continue to pay for health benefits. Benefits do not generate revenue for businesses.”
Thompson’s prediction is continually coming true on a local and national level.
According to an article published on Oct. 31 by Townhall.com, 51 percent of employer-sponsored plans will get canceled [during the open enrollment period- October 1, 2013 to March 31, 2014]. Small and large business owners all across the nation are canceling their policies, placing their employees’ fates in the hands of the private exchange, known as the Health Insurance Marketplace, which opened for business on October 1, 2013. Why are employers canceling their plans?
The answer is two-fold: canceling the plans is less expensive for employers and they face no penalties (until 2015) for not offering health insurance to their employees.
What does this mean? First, it is not the same for everyone. As described by Forbes.com, the Marketplace is designed for a one-stop, online shopping experience for health insurance. Each state has its own Marketplace and offers insurance from various participating companies.
As of 2009, Richland County had an average household income of $39,350. According to the Kaiser Family Foundation Subsidy Calculator, the average person here in Richland County might pay $3,210 per year for health insurance under the current Affordable Care Act. The national average is $4,028.
All plans, regardless of your home state, are categorized into four levels: Bronze, Silver, Gold and Platinum. Each plan denotes the amount covered by the health insurance company. Below is a graph showing what the amount covered by the plan (in blue) and what you spend out-of-pocket (in orange).
As the levels increase from Bronze to Platinum, so does your premium, but the amount you pay for health services decreases. For example, with a Bronze plan, your premium will be less each month, but the amount you owe for routine doctor visits increases.
Furthermore, in order for insurance companies to participate in the Marketplace, they must offer at least Bronze and Silver plans. All plans, whether it be Bronze, Silver, Gold or Platinum, will cover the Essential Health Benefits. Some companies will offer more, but all the essentials will be covered. They are:
- Addiction treatment
- Ambulatory patient services
- Care for newborns and children
- Chronic disease treatment (like diabetes and asthma)
- Emergency services
- Hospitalization
- Laboratory services
- Maternity care
- Mental health services
- Occupational and physical therapy
- Prescription drugs
- Preventative and wellness services (vaccines, cancer screenings)
- Speech language therapy
Another element of the health reform is the adjusted out-of-pocket maximums. For 2014, limits are $6,350 for individuals and $12,700 for families. Usually, the limits are based on one year, the policy’s pay period. Once these limits are met, your insurance company will start to pay 100 percent of the allowed amount under the plan.
Because so many businesses are canceling their insurance plans for their employees, some of these employees will be eligible for lower monthly premiums and out-of-pocket expenses. These subsidies, which are applied for on healthcare.gov through the Marketplace, are called Cost-Sharing Reductions, and Advanced Premium Tax Credits.
The Cost-Sharing Reductions subsidy is designed to help decrease the out-of-pocket costs such as, deductibles, co-pays and co-insurance.
The Advanced Premium Tax Credits are designed to reduce monthly premium costs.
In order to receive these subsidies, an individual must meet two requirements: ineligible for public coverage (Medicaid, Medicare and Children’s Health Insurance Plan) and, health insurance through an employer is unavailable.
In other words, if you are a worker for a privately owned, or corporately owned business that no longer offers health insurance, and your income is above the poverty line, you will need to sign up for health insurance by shopping through healthcare.gov by March 31, 2014, or face fines.
