ACA BASICS Flashcards
What is the Affordable Care Act?
The Affordable Care Act (ACA) is a federal law, signed in 2010, that reformed America’s health care and insurance landscape. Formally known as the “Patient Protection and Affordable Care Act” and colloquially called “Obamacare,” the ACA includes several key provisions that gave 20 million Americans access to affordable health insurance coverage
- The creation of health insurance marketplaces, aka exchanges
- The individual mandate - which required every American to have health insurance or pay a tax penalty
-People with pre-existing conditions cannot be denied coverage or charged more for it
- Children can stay on a parent’s plan until they turn 256 years old
- Preventative care at no additional cost
-Subsidies, or tax credits, for qualifying individuals/families purchasing through the marketplace
-The expansion of Medicaid for low-income adults up to 138 percent of the Federal Poverty Level
Individual Mandate Repealed at The Federal Level:
The individual mandate penalty was repealed at the federal level in 2019. As of 2022, a select number of state have since implemented their own health insurance individual mandates and penalties. These include California, the District of Columbia, Massachusetts, New Jersey, and Rhode Island. Vermont has their own individual mandate, but they do not have a penalty associated with it.
ACA Plans 10 Essential Coverages:
All ACA plans sold must provide care for the 10 Essential Coverages:
1. Ambulatory patient Services (i.e., outpatient care)
2. Emergency Services
3. Hospitalization
4. Pregnancy, maternity, and newborn care
5. Prescription Drugs
6. Mental health and substance use disorder services
7. Rehabilitative and habilitative services and disorders
8. Laboratory Services
9. Preventative, wellness services, and chronic disease management
10. Pediatric services (must include vision and dental care)
Note: Lesser-known rights and benefits under the ACA include access to breastfeeding equipment, support, birth control, and counseling. The ACA also secured access to coverage for substance abuse services in the middle of the opioid epidemic.
It’s important to note that the ACA further provides health policyholders the right to appeal their insurer’s decision to not pay a claim or end their coverage; the insurer must provide their reasoning for these actions. Employees are also protected from employer retaliation for receiving a premium tax credit or reporting violations of the ACA to their employer or the government.
Who Qualifies For An ACA Plan?
Someone is eligible to enroll in marketplace health coverage if they live in the United State, are a U.S. citizen or national (lawfully present), and are not incarcerated.
Key Notes: Lives in the U.S, is a U.S. Citizen, or is lawfully present
Not incarcerated
Does not have Medicare coverage
Note: Medicare beneficiaries are not eligible for ACA health coverage and are not eligible to purchase health or dental coverage through the marketplace.
Medicare Beneficiaries Not ACA Eligible?
Medicare beneficiaries are not eligible for ACA health coverage and are not eligible to purchase health or dental coverage through the marketplace.
Overview of the Marketplace:
The ACA marketplace is also known as the individual health insurance marketplace or exchanges. It includes the websites where Americans go to buy under-65 health insurance plans.
The federal marketplace can be accessed through healthCare.gov. however, the federal marketplace is not accessible in all states.. The following states have their own marketplace sites or exchanges:
California
Colorado
Connecticut
District of Columbia
Idaho
Kentucky
Maine Maryland
Massachusetts
Minnesota
Nevada
New Jersey
New Mexico
New York
Pennsylvania
Rhode Island
Vermont
Washington
Enrollment Periods:
Every year, people can shop for an enroll in new under-65 health plans on the marketplace during the Open Enrollment Period (OEP), which runs from November 1to December 15,
Or, they may enroll during a Special Enrollment Period (SEP).
Changes to a client’s ACA coverage may not occur outside of the OEP, unless they qualify for a SEP.
If your client changes employers, they can switch to an employer-sponsored health insurance plan, however, they may no longer qualify for a premium tax credit or other savings they may have had access through with their ACA plan.
SPECIAL ENROLLMENT PERIOD (SEP) QUALIFYING EVENTS:
- Job loss
- Marriage/divorce
- Coverage loss
- moving to a new zip code
- New child or death in the family
- Citizenship status change
- Government error
- Change in subsidy eligibility
- Qualifying federal reason
NOTE: TO TAKE ADVANTAGE OF AN SEP, YOUR CLIENTS MUST ACT WITHIN 60 DAYS OF THE QUALIFYING LIFE EVENT.
ACA Subsidies:
You should evaluate your clients eligibility for an ACA subsidy. This is in the form of an Advanced Premium Tax Credit designed to help lower-income and middle-income individuals and families afford health insurance. Millions of Americans are eligible for one especially after the passage of the American Rescue Plan Act of 2021 (ARP), which broadened eligibility for ACA subsidies in light of the COVID-19 pandemic.
The Inflation Reduction Act (IRA) of 2022 extended ACA subsidies through 2025.
To qualify for an ACA subsidy, someone must meet the following criteria:
- Income is between 100% to 400% of the Federal Poverty Level
- Buying health plan through the marketplace or exchange
- Does not have “affordable” employer-sponsored coverage available to select
Note: To be considered “affordable,” the health plan must provide at least 60% of covered benefits or have premiums that would cost the member no more than 8.5% of their annual household income after tax credits.
Individuals who fall below 138% of the FPL (or their state’s designated limit) should qualify for free-or-low-cost health insurance through Medicaid. If your client live in Hawaii or Alaska, be aware that poverty guidelines differ.
Before the American Rescue Plan Act of 2021, households barely above 400% of the FPL made just enough money to be ineligible for the Advanced Premium Tax Credit. Now that the maximum net premium is capped at 8.5% through the end of 2025, these clients have access to subsidies.
When helping you client apply for a plan, you’ll work together to estimate how much income they think they’ll have for the year. then, they’ll receive a subsidy based on that income estimate, as well as additional factors. When your client files their taxes at the end of the year, they may have to pay back some or all of the subsidy if they earned over their estimated income for the . Alternatively, if they made less than their original estimate, they should get a refund of any additional portion of the subsidy they may qualify for.
Plan Differences in Provider networks
Insurance carriers offer many different type of ACA plans. There are three different plan types in regard to provider networks. Health Maintenance Organization (HMO), Preferred Provider Organization (PPC), and Exclusive Provider Organization (EPO).
HMO and EPO plans limit coverage to a local network of physicians and facilities and typically will not cover out-of-network care, except for emergency services. PPO plans have a larger medical provider network and will cover costs out-of-network but for a higher premium.
HMO: Has a small and local network , will provide coverage for out-of-network services in emergencies only. Monthly premium costs are the lowest; and there is limited flexibility in its coverage.
EPO: Has a medium size and local network, will provide coverage for out-of-network coverage in emergencies only. Monthly premium cost is moderate; and there is moderate Flexibility in its coverage.
PPO: Has a Large size network, will provide out-of-network coverage for an added cost; Monthly premium cost is the highest; and there is a high flexibility in its coverage.
How Effective Dates Work?
Effective dates for ACA plans are the date when the client’s new coverage will begin. For most marketplace plans sold during the OEP between November 1 and December 15, this is January 1.
Most ACA plans sold between December 16 and January 15 will be effective February 1.
NOTE: Effective dates can differ for plans sold on state exchanges. For example, some state may have an extended OEP, allowing a client to enroll in ACA coverage as late as January 31 and have an effective date of March 1.
If you are enrolling a client in marketplace coverage during an SEP, most plans will be effective starting the first day of the following month, including plans sold on HealthCare.gov. Some state follow different effective date guidelines for SEPs, where a client must enroll by the 15th or 23rd of the month for their new coverage to begin the first of the following month. Those who enroll after the state’s mid-month deadline would have coverage effective the first of the second following month. For example, if you enroll a client in an ACA plan on March 13, their coverage could possibly begin April 1; but if you enroll that client in the plan on March 24, their coverage could possibly only begin May 1.
Be mindful of coverage gaps when enrolling clients in ACA insurance. Often, a client’s previous plan will end in the middle of the month, while most ACA plans don’t begin until the first of each month. If these coverage gaps are a problem for your client, consider COBRA or other short-term insurance solutions.
Effective Dates and Coverage Gaps?
Be mindful of coverage gaps when enrolling clients in ACA insurance. Often, a client’s previous plan will end in the middle of the month, while most ACA plans don’t begin until the first of each month. If these coverage gaps are a problem for your client, consider COBRA or other short-term insurance solutions.
What is The Consolidated Omnibus Budget Reconciliation Act (COBRA)
The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death, divorce, and other life events. Qualified individuals may be required to pay the entire premium for coverage up to 102% of the cost to the plan.
COBRA generally requires that group health plans sponsored by employers with 20 or more employees in the prior year offer employees and their families the opportunity for a temporary extension of health coverage (called continuation coverage) in certain instances where coverage under the plan would otherwise end.
COBRA outlines how employees and family members may elect continuation coverage. It also requires employers and plans to provide notice.
What is Short-Term Health Insurance?
Short-term health insurance is a type of health plan that can provide you with temporary medical coverage when you are between health plans, outside enrollment periods, and need some coverage in case of an emergency. However, to get the most out of a short term health plan, you need to understand how they work, what they cost, and what they cover.
What are the pros and cons to short-term health insurance?
If you’re considering whether a short-term health insurance plan is right for you, here are some pros and cons:
Pros:
Designed to fill short-term gaps in coverage should you need it
You can cancel coverage whenever you’d like without penalties
You can typically choose a plan that covers you up to a year, if needed
Many different plan designs are available, depending on insurance carrier
Cons:
Significantly higher deductibles than traditional health plans with other possible unforeseen costs
No coverage for pre-existing conditions and limited coverage for most services
A medical questionnaire may be required to be approved for coverage
Coverage is not mandated or standard, so plans vary greatly in covered services and costs with very little government oversight
Short-term health plans are not a good fit for everyone. For comprehensive coverage and benefits, make sure you enroll in a traditional health plan. This is either a plan offered through your employer or one you buy on your own through an individual insurance company or the Health Insurance Marketplace.
