Transcript Document

Affordable Care Act & changes to
Wisconsin Medicaid
July 2013
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Overview
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Individual Mandate
Federal Exchanges (SHOP & Marketplace)
Changes to Badgercare
Future of HIRSP
Changes to employer group health plans
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The Individual Mandate
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Starting January 1, 2014, most people
required to have health insurance or pay
penalty.
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Individual Mandate
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Purpose of mandate
Challenge to Individual Mandate
Acceptable Insurance
Exemptions to insurance requirement
Penalties for failure to have insurance
Employer shared responsibility
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Purpose of Individual Mandate
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Conceived in 1990s by conservative
economists as alternative to Hillarycare.
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Purpose of Individual Mandate
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One Goal of insurance is have healthy people
subsidize unhealthy people.
Because insurers no longer able to prohibit
people with pre-existing conditions from
obtaining insurance, no mandate may mean:
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People may wait until sick to obtain.
Thus, only sick will have insurance.
Claims will be higher.
Will drive up cost of insurance.
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Challenge to Individual Mandate
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Challenged in court by conservative
governors.
Upheld as Constitutional in June 2012 by
United States Supreme Court.
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Acceptable insurance under
Individual Mandate
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Insurance acceptable to meet mandate:
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Medicare
Medicaid
Employer Group Health Insurance
Individual health insurance
COBRA
Tri-care
Etc.
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Exemptions to requirement to have
insurance
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Most required to have health insurance.
As with every rule, there are exceptions.
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Exemptions from Individual Mandate
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Undocumented immigrants (illegal aliens)
Incarcerated persons
Members of an Indian Tribe
Religious conscience objection
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Mainly Mennonite and Amish groups
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Exemptions from Individual Mandate
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Member of health care sharing ministry
Income below requirement to file tax return
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$9,350 for individual
Out-of-pocket cost for health insurance more
than 8% of income
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Based on cost of bronze plan
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Exemptions from Individual Mandate
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Hardship exemption
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Homelessness
Eviction
Domestic violence
Death of close family member
Disasters damaged individual’s property
Income between 100 & 138% of FPL
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Exemptions from Individual Mandate
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Also get three month slide.
Can go three months, one time, without
health insurance before penalty kicks in.
After that, people assessed 1/12th of annual
penalty for each month with no coverage.
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Exemptions from Individual Mandate
Obtaining an exemption:
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Hardship & Religious exemptions determined by
exchange (Marketplace).
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Person must file application with exchange.
Exchange then issues certificate.
Remaining exemptions claimed by individual at
time taxes filed.
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Penalty for no insurance
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Called a “shared responsibility payment”
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2014:
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2015:
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Greater of $325 or 2% of family income
2016:
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Greater of $95 or 1% of family income
Greater of $695 or 2.5% of income
After 2016:
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Penalty amount increases with cost of living
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Penalty for no insurance
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Max penalty per family capped at no more
than 300% of the minimum penalty.
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For example, in 2016, max penalty would be $695
x 300% = $2,085.
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Payment of penalty
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Penalty due when taxes are otherwise due.
Assessed and collected like any other tax.
Persons who fail to pay not subject to
criminal penalties or liens and levies.
After application of exemptions, estimated
only 2% of Americans will have to pay the
penalty.
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Employer Responsibility
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Delayed until at least 2015
Penalty between $2,000 to $3,000 if:
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Employer has equivalent of 50 or more full-time
workers;
Employer does not offer affordable health
insurance with minimum essential coverage;
At least 1 Employee purchases health insurance
in Exchange; and
Employee receives subsidy in Exchange.
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Health Insurance Exchanges
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Background
SHOP Exchange
Individual Exchange (Marketplace)
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Eligibility requirements
Coverage
Plan tiers
Subsidies
Enrollment & Applications
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Health Insurance Exchanges
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November 2012, Governor Walker decided
against state-run health insurance exchange.
Thus, Federal Government will run
exchanges in Wisconsin.
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Health Insurance Exchanges
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Two types of exchanges in Wisconsin:
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SHOP Exchange for small businesses.
Exchange for individuals.
Federal government has rebranded Individual
exchange as “Marketplace.”
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Health Insurance Exchanges
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Wisconsin Department of Health Services
estimates approximately 700,000 people will
enroll in exchanges (SHOP & Marketplace).
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Health Insurance Exchanges
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Open enrollment begins October 1, 2013.
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Insurance starts January 1, 2014.
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SHOP Exchange
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Small Business Health Options Program.
In 2014 & 2015, businesses with up to 50
employees can buy insurance in exchange.
Some aspects of SHOP Exchange delayed
until 2015.
In 2016, businesses with up to 100
employees will be able to buy insurance in
exchange.
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Individual Exchange (Marketplace) Eligibility
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Individuals can buy individual and family
health insurance on Marketplace if:
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Not undocumented immigrant (illegal alien);
Not incarcerated; and
Meet state residency requirements.
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No more underwriting
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Anyone will be able to purchase health
insurance on Marketplace regardless:
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Pre-existing conditions
Health status
History of claims
Premium cannot be higher because of health
condition.
Cannot charge women higher price.
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No more underwriting
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Price can vary on:
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Age – but limited.
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Cannot charge more than 3 times for older person
compared to younger person.
Currently, averages about 5 times more for older person
– but can be as high as 10 times more.
Where person lives.
Tobacco use.
Plan tier.
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Plan coverage
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Insurance obtained thru Marketplace called
Qualified Health Plan (QHP)
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Plan coverage
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All plans include Essential Health Benefits.
This includes coverage for:
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Ambulatory patient services
Emergency services
Hospitalization
Maternity and newborn care
Mental health and substance use disorder services, including
behavioral health treatment
Prescription drugs
Rehabilitative and habilitative services and devices
Laboratory services
Preventive and wellness services and chronic disease management
Pediatric services, including oral and vision care
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Plan coverage
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All plans will also include state mandates
such as:
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Autism
Cochlear implants coverage
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Similar plan coverage will allow
apples-to-apples comparison
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In past, difficult to compare insurance plans
because differed on what was covered.
Because all plans will cover EHB,
Marketplace will allow for apples-to-apples
comparison.
Plans will materially differ only by provider
network & by plan tier.
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Plan tiers
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Different tiers based on actuarial coverage:
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Platinum
Gold
Silver
Bronze
Catastrophic
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- 90%
- 80%
- 70%
- 60%
Must be under 30 years old
Cannot have other affordable
insurance option
Not eligible for subsidies
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Plan Tiers
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Bronze plan:
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Insurance covers 60% health care costs for
average person.
Enrollees, on average, responsible for paying
40% costs.
Platinum plan:
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Average individual would pay 10% out-of-pocket
for covered benefits.
Insurer would pay 90%.
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Plan Tiers
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However, individuals with high-cost health
conditions could pay significantly more than
average.
Premiums higher for Platinum plan, lower for
Bronze plan.
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Subsidies
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Subsidies available if:
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Not eligible for Medicare or Medicaid; and
Cannot obtain affordable employer insurance; and
Income between 100 & 400% of FPL.
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Subsidies
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Congressional Budget Office estimates that 7
out of every 8 people buying insurance on
Marketplace will receive subsidies
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Not Eligible for Medicare or Medicaid
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“Eligible” is key word.
Person cannot obtain subsidy by disenrolling
in Medicare.
If disability determination needed for
Medicaid, person not “eligible” for Medicaid
until favorable disability determination made
by SSA or state Medicaid.
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Affordable employer health insurance
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Employer insurance affordable if:
Worker’s share of premium less than 9.5% of
household income.
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Calculation based solely on what worker would pay for
self-only coverage and not family coverage;
And
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Insurance must provide also “minimum value.”
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Covers at least 60% of costs.
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Affordable employer health insurance
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By October 1, 2013, employers must give
employees notice about:
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Coverage that is available on the Marketplace;
If employer-sponsored coverage is offered; and
Whether that coverage provides minimum value.
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Subsidies
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Premium reductions if income between 100 &
400% of FPL.
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Cost-sharing reductions if income between
100 & 250% of FPL.
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Between about $23,000 to $94,000 a year for
family of four.
About $59,000 for family of four.
Out-of-pocket maximum reduced if income
between 100 & 400% of FPL.
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Premium reductions
(Based on Silver Plan)
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Also called advanced premium tax credits.
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Premium reduction Example
(Based on Silver Plan)
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2013 Household income 110% FPL = $12,639
Unsubsidized silver plan yearly premium = $3,018
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Monthly premium = $251.50
With premium reduction, max % of income for
premium = 2% of income.
2% of yearly income = $253
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Monthly premium = $21.08
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Cost-sharing reductions
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Won’t know exact details of cost-sharing
reductions until plan info released in August
or September
Can only obtain with Silver Plan
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Out-of-pocket maximum
reductions
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2013 maximum out-of-pocket limits:
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$6,250 for self-only coverage
$12,500 for family coverage
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Premium & cost-sharing estimates:
(Based on taking Silver Plan)
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Premium & cost-sharing estimates:
(Based on taking Silver Plan)
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Subsidies
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Subsidy calculator at UC Berkeley Labor
Center:
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http://laborcenter.berkeley.edu/healthpolicy/calcul
ator/index.shtml
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Open Enrollment Period for 2014
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Open enrollment October 1, 2013 to March
31, 2014.
If enroll by December 15, coverage starts
January 1.
If enroll between Dec. 16 & Jan. 15, coverage
starts February 1.
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Open Enrollment Period for 2014
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In future, if enroll between 1st & 15th of month,
coverage begins 1st of following month.
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Example: enroll Feb. 6, coverage begins March 1.
If enroll between 16th & end of month,
coverage begins 1st day of 2nd following
month.
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Example: enroll Feb. 18, coverage begins April 1.
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Future Open Enrollment
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For 2015 and later years, Open Enrollment
Period is October 15 to December 7 of the
previous year.
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Special Enrollment Periods
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SEP triggered by “qualifying life event.”
SEP 60 days from “qualifying life event.”
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Only applies to individual market
For employer plans, SEP is 30 days.
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Special Enrollment Periods
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Coverage start date similar to open
enrollment.
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Enroll between 1st & 15th of month, coverage
begins 1st of following month.
Enroll between 16th & end of month, coverage
begins 1st day of 2nd following month.
However, coverage effective on date of birth,
adoption or placement for adoption, when that is
“qualifying life event.”
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Special Enrollment Periods
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Qualifying Life Events
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Losing other minimum essential coverage unless
caused by nonpayment of premium.
Becoming dependent through marriage, birth,
adoption or placement for adoption.
Gaining status as citizen, national or lawfully
present individual in USA.
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Special Enrollment Periods
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Qualifying Life Events
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Experiencing an error in enrollment.
QHP substantially violated material provision of its
contract.
Losing exemption from individual mandate
Becoming newly eligible or newly ineligible for
different amount of subsidies.
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Special Enrollment Periods
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Qualifying Life Events
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New QHPs becoming available as result of
permanent move.
Individual is Indian, as defined by the Indian
Health Care Improvement Act.
Other exceptional circumstances, as determined
by the Exchange or Health & Human Services
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Error by exchange employee or agent, etc.
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Applying thru Marketplace
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Consumers will be able to enroll in QHP:
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Online
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Phone
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www.healthcare.gov.
Website will have chat capabilities;
24 hour call center: 1-800-318-2596;
Mail; or
In person at certain locations.
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Applying thru the Marketplace
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Call Center
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Massive call centers expected to handle 42 million
calls by end of 2013.
Caveat: call centers may be inaccurate.
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When Part D launched, about one-third of callers got an
inaccurate or incomplete answer from new call center.
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Navigators
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Navigators will assist people with
enrolling in insurance in Marketplace.
Federal government offering around
$800,000 in grants for Wisconsin Navigator
program.
Grants to be awarded in August 2013.
Also may be Certified Application Counselors
to help apply.
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Applying thru the Marketplace
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Marketplace should know previous year’s
income thru tax return automatically.
Individuals will be able to apply for Medicaid
thru Marketplace
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Will not be a real-time decision.
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Termination of coverage
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Persons with subsidized policy qualify for
three-month grace period on premium
payments after paying at least one month's
premium.
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Potential Medicaid Expansion Background
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Under Affordable Care Act, states were required to
expand Medicaid to all adults with incomes less than
133% FPL or lose all Federal funding for Medicaid.
Supreme Court held states could decide not to expand
Medicaid without losing Federal funding for all Medicaid.
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Potential Medicaid Expansion
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No deadline for states to decide whether to
take Medicaid Expansion.
Could take in future years or drop after taking
Expansion.
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Cost of potential Medicaid
Expansion
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Currently, Wisconsin pays approximately
40% cost of Medicaid, and Federal
government pays 60%.
For expanded Medicaid population,
Federal government would pay 100%
costs for 2014, 2015, and 2016.
After 2014, Federal government share
would be reduced to 90% by 2020.
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Badgercare Plus Changes
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2013 – 2015 budget rejects Medicaid
expansion.
Instead, alternative plan in budget.
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Badgercare Plus Changes
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Currently, parents with children eligible for
Badgercare Plus if income below 200% of
FPL.
Budget lowers eligibility for Badgercare Plus
to 100% of FPL on January 1, 2014.
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Badgercare Plus Changes
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Currently, some childless adults receive
Badgercare Plus Core if income below 200%
of FPL.
However, enrollment closed in Core.
Budget terminates anyone above 100% of
FPL from Core on January 1, 2014.
Childless adults below 100% will be eligible
for new Badgercare Plus plan.
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Cannot be eligible for Medicare
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Badgercare Plus Changes
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Coverage for new Badgercare Plus plan for
childless adults will be Badgercare Plus
Standard Plan.
Thus, coverage for childless adults will be
better than current Core plan.
No annual enrollment fee for childless adults.
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Badgercare Plus Changes
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DHS estimates approximately 93,000
childless adults will gain Badgercare
coverage under Badgercare Plus changes.
Approximately 92,000 adults will lose
Badgercare Plus and Core on Jan 1, 2014.
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They will have to purchase health insurance
through the Marketplace.
Only affects Badgercare Plus & Core; does
not affect Elderly, Blind, & Disabled Medicaid.
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Future of HIRSP
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Because people with pre-existing conditions
will be able to obtain insurance in
Marketplace, HIRSP ending January 1, 2014.
HIRSP non-Medicare members will:
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Below 100% FPL, be eligible for new Badgercare
Plus benefit.
Above 100% FPL, obtain insurance in Exchange.
HIRSP Medicare members will have
guaranteed issue into traditional Medicare
Supplement.
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Changes to employer group health
insurance
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Beginning January 1, 2014 – out-of-pocket
maximum for non-grandfathered plans
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$6,350 for individual
$12,700 for family
Includes copayments, coinsurance & deductibles
but not premiums
May not apply to drug cost if plan uses separate
administrator
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Changes to employer group health
insurance
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Beginning January 1, 2014 – maximum 90
day waiting period.
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Changes to employer group health
insurance
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Currently, employer plans may exclude
coverage for preexisting conditions for 12
months.
Exclusion period reduced by 1 day for every
day of previous creditable coverage.
On January 1, 2014, preexisting condition
exclusions prohibited for all employer plans.
Thus, HIPAA provisions re creditable
coverage obsolete after January 1, 2014.
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End of Presentation
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These materials are current as of July 11,
2013.
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Because federal government & state responses to
implementation of ACA has frequently changed,
materials may not be correct after July 11, 2013.
Any questions – contact Jason Klimowicz
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(608) 267-0214
[email protected]
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