Navigating the Health Law

By Grace-Marie Turner

The first deadlines have now passed for enrollment in health insurance through the health law’s exchange “marketplaces,” but surveys show that consumers are as confused as ever about what’s required of them.

Most people have heard about some of the early provisions of the law – such as allowing 26-year-olds to stay on their parents’ policies, free preventive care, and coverage for pre-existing conditions.

But a Kaiser Family Foundation survey found that more than half of Americans say they don’t understand how the health law will affect them or their families, and well over half of the uninsured don’t know the law requires them to purchase health insurance unless they can show they are exempt or paying for the policy would be a hardship.

There is danger ahead for those who don’t know the law, especially the uninsured.  Three road signs described below may help:  1) Navigators Ahead, 2) Beware of Mandates, and 3) Watch for Costs.

1) Navigators Ahead:  The health law will subsidize health insurance for millions of Americans, and thousands of “Navigators” and “Assisters” are being hired, generally by non-profit organizations, to help people apply. Navigators are not licensed, and while they do receive some training, they do not go through the extensive process of certification and background checks required of insurance agents and brokers.  Further, not everyone who says they are a Navigator may actually be one.

They will be gathering personal information, such as Social Security numbers, address, income, employer’s name and address, names and birthdates of your children, and health habits to find out if you qualify for ObamaCare subsidies.

Giving this information to strangers presents a risk for identity theft. Thirteen attorneys general have expressed deep concerns about the security of the information. The risks of potential identity theft are very real. Be very careful who you give this information to.

2) Beware of Mandates:  Second, the law contains an “individual mandate” that requires virtually everyone to have health insurance.  The “individual mandate” is aimed primarily at uninsured Americans who must obtain government-approved health insurance or pay a fine, but surveys show that the uninsured are least likely to know they will be subject to the mandate.

People have until March 31 to obtain health insurance which meets government specifications or pay a tax penalty.  If you are on Medicare or have health insurance through your job, your coverage likely meets the test.  If not, the penalty for not complying in the first year starts at $95 or 1% of income, whichever is greater. The penalty will increase to $325 in 2015 and $695 in 2016, or 2 ½% of income. The penalties scale up after that.

The administration announced on December 19, 2013, it was expanding the “hardship waiver.”  If you can show that health insurance is not affordable or if you previously had insurance that was cancelled, you will not be subject to the tax penalties for 2014.

3) Watch for Costs:  Finally, it is very important to properly state your income on the application and to understand the full costs of the health insurance plans you are choosing to adequately prepare for the new expenses.

The health plans offered through the health exchange “marketplaces” will NOT be free. Almost all consumers will be required to pay monthly premiums and high deductibles as well as co-payments for doctors’ visits.  The amount depends both upon the plan you select and your income.

If you do not pay your premiums, your policy will be cancelled, and you will be penalized.  Further, if you understate your income and get a larger subsidy than you are entitled to receive, you will be required to repay the surplus, possibly thousands of dollars.

When considering future costs, it is also important to be aware of the possible increase in premiums. While campaigning in 2008, then-Senator Obama promised his health plan would “cut the cost of a typical family’s premium by up to $2,500 a year.” However, early evidence shows that, on average, premiums are expected to increase by 24 percent, and some states will see premium increases as high as 130 percent.

To be a wise consumer, you should protect your personal information, understand your choices when it comes to purchasing insurance, and educate yourself so you are fully aware of how much your new insurance plan is going to cost you.

Posted on Fairfax Free Citizen December 26, 2013

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