|By The Associated Press|
Health insurance exchanges will change the way people buy coverage and will help millions of uninsured people get a private plan. Nearly 49 million people are uninsured in
Exchanges will be the most visible part of President
Some questions and answers on how the exchanges will work:
Q: What's a health insurance exchange?
A: "Exchange" is just another word for "marketplace." The plans sold in the new markets will start covering patients on
There will be three types of exchanges at the beginning: those run by states, those run by the federal government, and partnerships. Most Republican governors opposed to "Obamacare" are letting
For consumers, the benefits should be the same no matter who runs the exchange.
Q: How will exchanges work?
A: Exchanges are supposed to have the feel of an online travel site _ think
Middle-class people will be able to pick from a range of private insurance plans, and most people will be eligible for help from the government to pay their premiums.
Low-income people will be steered to safety-net programs for which they might qualify. This could be a problem in states that choose not to expand their
Q: How will I know if I can get help with my health insurance premiums?
A: You'll disclose your income to the exchange at the time you apply for coverage and they'll let you know. Only legal residents of
The health care law offers sliding-scale subsidies based on income for individuals and families making up to four times the federal poverty level, about
But do yourself a favor and read the fine print because the government's help gets skimpier as household income increases.
For example, a family of four headed by a 40-year-old making
A similar hypothetical family making
The estimates were made using the nonpartisan
Final note: Though it's called a "tax credit" the government assistance goes directly to the insurer. You won't see a check.
Q: What will the benefits look like?
A: The coverage will be more comprehensive than what's now typically available in the individual health insurance market, dominated by bare-bones plans. It will be more like what an established, successful small business offers its employees. Premiums are likely to be higher for some people, but government assistance should mostly compensate for that.
All plans in the exchange will have to cover a standard set of "essential health benefits," including hospitalization, doctor visits, prescriptions, emergency room treatment, maternal and newborn care, and prevention. Insurers cannot turn away the sick or charge them more. Middle-aged and older adults can't be charged more than three times what young people pay. Insurers can impose penalties on smokers.
Because the benefits will be similar, the biggest difference among plans will be something called "actuarial value." A new term for consumers, it's the share of expected health care costs that the plan will cover.
There will be four levels of coverage, from "bronze," which will cover 60 percent of expected costs, to "platinum," which will cover 90 percent. "Silver" and "gold" are in between. Bronze plans will charge the lowest premiums, but they'll have the highest annual deductibles. Platinum plans will have the highest premiums and the lowest out-of-pocket cost sharing.
Here's a wrinkle: The government's subsidy will be tied to the premium for the second-lowest-cost plan at the silver coverage level that's available in your area. You could take it and buy a lower cost bronze plan, saving money on premiums. But you'd have to be prepared for the higher annual deductible and copayments.
Federal government health care site: www.healthcare.gov
Kaiser Health Reform Subsidy Calculator: http://healthreform.kff.org/subsidycalculator.aspx
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