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July 06-- With the prospects of a 2014 tax hit for anyone who doesn't have "qualifying" health insurance, a prudent person might want to know if his or her insurance qualifies.
Unfortunately, there's no telling, and Oklahoma hasn't even started the process of resolving that question.
Starting in 2014, Americans must report on their income tax returns whether they have qualified health insurance. If they don't, they have to pay the higher of $95 or 1 percent of their taxable income. In 2015, the tax rises to $325 or 2 percent of taxable income. In 2016, the tax rises again, to $695 or 2.5 percent of taxable income.
The maximum penalty is $2,085 per family, and there are several exceptions to the tax.
So every Oklahoman with health insurance has an interest in what health insurance qualifies under the law.
The Affordable Care Act broadly defines 10 areas that all health insurance must cover, but it leaves specifics within those areas to be determined on a state-by-state basis.
Defining qualifying health insurance is part of the process of setting up a state health insurance exchange, and Oklahoma has never gotten to the starting line of that race.
State Deputy Insurance Commissioner Mike Rhoads said all the pieces are available for determining what a qualifying insurance plan must contain but that the state doesn't have a mechanism for making some key choices in the process.
The Oklahoma Legislature has balked two years in a row at proposals to establish an exchange, which could clarify what insurance plans qualify under the law.
Although Gov. Mary Fallin has put off deciding how the state should approach the exchange controversy until after November's election, current federal law says Oklahoma will have an exchange, either one established by the state, one imposed by the federal government or a hybrid with some tasks done by the state and others by the federal government.
That exchange will choose a benchmark health insurance program that reflects a typical employer plan in the state. The benchmark can be one of the three largest small-group plans in the state, one of the three largest state-employee health plans, one of the three largest federal health plans or the largest HMO plan offered in the state.
If the federal government sets up the state's exchange, the U.S. Department of Health and Human Services has announced that it will use the small-group plan with the largest enrollment in the state as the default benchmark. In Oklahoma, that would be Blue Cross Blue Shield.
The benefits and services included in the benchmark health insurance plan would be the state's essential health benefits package. Plans could modify coverage within a benefit category so long as they do not reduce the value of coverage.
The federal law also specifies other standards for qualifying plans, including that they all must be licensed by the state insurance department and that they all must offer four graded steps of coverage -- bronze, silver, gold and platinum -- reflecting how much of health-care costs are covered by the plan.
For example, if you had a bronze plan, the insurance company would pick up 60 percent of the cost, but a platinum plan would cover 90 percent.
For insurance plans created after Sept. 23, 2010, the law also includes a long list of preventive care services that must be covered, including cholesterol screening, many immunizations, mammograms, and autism screening for children.
There are many exceptions to those mandates -- including an exemption for plans in effect before March 23, 2011, the date the Affordable Care Act was enacted.
Under the Affordable Care Act, all health insurance will include all of the following general categories:
--Ambulatory patient services
--Maternity and newborn care
--Mental health and substance-use disorder services, including behavioral health treatment
--Rehabilitative and habilitative services and devices
--Preventive and wellness and chronic disease management
--Pediatric services, including oral and vision care
Source: Affordable Care Act
Wayne Greene 918-581-8308
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