Louisiana Healthcare 101

It is taking effect in bits and pieces, but the end result of America’s new health care law will be a dramatic change in how United States citizens gain access to care.

A key provision of the Patient Protection and Affordable Care Act, which requires that nearly all citizens be covered by health insurance, is a nationwide Health Insurance Marketplace where people can shop for suitable coverage, and the market opens for business this month.

The Health Insurance Marketplace is actually a website – at HealthCare.gov – where people can examine health plans that meet the federal government’s requirements for “affordable” insurance and use tools that will help them choose and apply for coverage. Businesses will also be able to shop the marketplace for employee health plans.

The final list of Louisiana insurers that will participate in the exchange was not yet final at press time, but at least one well-known carrier was expected to be involved.

Blue Cross and Blue Shield of Louisiana has already played an integral role in helping the state prepare for the marketplace. After Gov. Bobby Jindal flatly refused to create a state-run insurance exchange, thus defaulting to the federally run marketplace, the Blues plan organized community organizations across the state to help inform residents about the era of insurance availability.

The Blues last spring led the way in organizing the Louisiana Healthcare Education Coalition to educate people about what to expect under the new law and how the insurance marketplace will work.

In addition to familiar names, participating insurers will include a new organization.

The Louisiana Health Cooperative is a not-for-profit insurer set up just this year specifically to inject more competition into the Louisiana health insurance industry. The co-op received both its Louisiana license and federal approval to offer its plans in the Health Insurance Marketplace, and spokesman Jim Pittman says LAHC intends to market itself aggressively.

“We have done our best to keep our premiums as low as we can across Louisiana, and we’re going to be competitive,” he says.

LAHC is one of about 24 nonprofit carriers that have sprouted around the country as a direct result of the Affordable Care Act, one provision of which was the establishment of a loan program to encourage the development of nonprofit insurers in each of the 50 states. New insurers started up in fewer than half of the states, however, before the federal budget sequester took the remaining loan money off the table.

Pittman says that LAHC will fill a niche in the evolving insurance marketplace.

“We know that there are 800,000 people in Louisiana who don’t have health insurance and are not eligible for Medicaid or Medicare,” he says. “Some percentage of those people will be interested in our health plan.”

While the law’s focus is on health insurance affordability, plans that qualify under the Affordable Care Act are not necessarily offering bare-bones coverage.

The law requires, for instance, that all plans in the marketplace include, at a minimum, these benefits:

• Ambulatory patient services (outpatient care that doesn’t require hospital admission)
• Emergency services
• Hospitalization
• Maternity and newborn care
• Mental health and substance use disorder services, including behavioral counseling and psychotherapy
• Prescription drugs
• Rehabilitative services and devices (to help people with injuries, disabilities or chronic conditions gain or recover mental and physical skills)
• Laboratory services
• Preventive and wellness services and chronic disease management
• Pediatric services

Differences in pricing likely will be based on how much additional coverage each plan offers above these minimum requirements. Other pricing variables will include co-pays and deductibles.

In general, insurers are expected to offer policies in a series of “graded” levels ranging from catastrophic coverage to bronze, silver, gold and platinum plans. The marketplace will enable prospective buyers to compare plans side-by-side.

While no one can force individuals to enroll in a health plan, those who don’t will face an annual tax penalty which begins at $95 and likely will increase in subsequent years.

Other motivations to sign up include the fact that the law says insurers cannot deny coverage to anyone or charge more because of a pre-existing condition.

In addition, some individuals will be eligible for subsidies that will help them purchase coverage, just as some businesses will qualify for assistance in buying employee health insurance.

When all provisions of the Patient Protection and Affordable Care Act are implemented, businesses that employ more than 50 people will face an annual penalty of $2,000 for each full-time employee who isn’t covered by an employee health plan. While that coverage requirement takes effect in January, the penalty provision has been delayed until 2015, giving owners of businesses that are likely to be subject to the measure more time to plan how they will comply.

Employers subject to the act’s provisions still have responsibility this year for notifying employees about insurance affordability and their potential eligibility for insurance subsidies.

Some people may be surprised to learn that they qualify for the assistance. Subsidies will be available for people whose annual income totals as much as 400 percent of the federal poverty level benchmark. That means an individual with an income of about $46,000 a year, or a family of four with income of $94,200 could be eligible.

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