#ADVANTAGE: Does Healthcare Reform Make Health Plans Cheaper? (4/24/2014)

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We’ve recently created a blog segment called “#Advantage” where we’ll answer the questions that we get at Twitter. Our official Twitter hash-tag is #Advantage, and we’ll explain this in further detail in a future blog post. For now, you can find additional information at www.twitter.com/advantage (or @advantage).

Our 4/24/14 question was from “CA Medicare Assist” (@MedicareInCA) in Santa Rosa, California. The question was this:

Does healthcare reform make health plans cheaper? (see the official Tweet here) 

“CA Medicare Assist” (@MedicareInCa) mentions that this is the #1 question they’re asked. And… it’s a good one. Check out the answer below the tag.

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The answer is: In certain cases, yes it does. Healthcare reform can make health plans “cheaper” for certain policyholders. However, there are some additional important details that should be considered. Here are the questions that are raised:

  • How are these health plans made cheaper? Plans are made cheaper via “Advanced Premium Tax Credits” at public health insurance exchanges like Covered California. APTCs are commonly known as the “subsidies” that you hear so much about. These subsidies are applied to individual health insurance premiums to make them more affordable.
  • Who are these health plans made cheaper for? Health plans are made cheaper for individuals and families that fall between approximately 100% and 400% of FPL (or Federal Poverty Level). For individuals, this is about $11,000 to $45,000 per year in gross income.
  • Are health plans made cheaper for everyone? Nope. In fact, for many of those who fall outside of 100% to 400% of FPL (or individuals making more than about $45,000 per year), health plans can actually get more expensive in a lot of cases.
  • How are the subsidies that make these plans “cheaper” funded? These new subsidies are funded from a variety of different sources, mostly in the form of taxes. Here are a few of them: A) increasing the Medicare tax on high-income households, B) taxing high-cost medical plans, C) penalties for those who don’t get coverage, D) employers paying if they don’t provide coverage, E) new fees on the health industry, and certain others.

Thanks for stopping by at our “#Advantage” blog segment dedicated to questions from our followers and others. We hope you found our information to be valuable.

We’ll continue to roll-out answers as questions come in. Don’t forget to hash “#Advantage” at Twitter, and visit our official tag here: www.twitter.com/advantage.

Check back at our blog to get further information about funding healthcare. Also, please share with your friends, clients, colleagues, and family. Here are a few of our other information outlets:

Home Page: https://policyadvantage.com

Twitter: http://www.twitter.com/PolicyAdvantage

Facebook: http://www.facebook.com/PolicyAdvantage

YouTube: http://www.youtube.com/PolicyAdvantage

Pinterest: http://www.pinterest.com/PolicyAdvantage

Word Press: http://www.policyadvantage.wordpress.com

 

The Policy Advantage Insurance Services Lion: He’s Got a Name

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Today’s blog post is a “fun” blog post. We’ll do this every once in a while. Instead of talking about insurance and employee benefits, we’ve got some news to share (ie: some “insider” info about our brokerage). We like to keep you up-to-date about what’s going on within the business too.

If you’ve been following along at Twitter (@PolicyAdvantage) you’ll know there have been some recent tweets about our lion having a name. It’s TRUE: we’ve found a really-really good name for him. It fits our theme well. In fact, he’s even got his own .co that we’ll be developing, where you can visit.

So yes… there’s been some buzz. But we have not yet shared his name. There are a couple of different reasons for this:

  1. We’re still in the very early stages of his development (logos, website, his three dimensional design, etc). So he’s not even really a cub yet.
  2. We’re still determining exactly what his role will be. We’ve got a really good idea, but we’re still “fine tuning” things.

You’ll find some further information about this undercover project below.

His biggest goals will be to:

  1. Create a fun & interactive consumer engagement environment.
  2. Share important information about the insurance industry.
  3. Promote Policy Advantage Insurance Services to the public as our front-line icon.

Symbolism of the Lion (and White Lion)

He does represent specific qualities. These qualities are important as an insurance brokerage and every day. Many of these qualities were a big part of the basis behind our original image and logo design:

  • Symbolism of the Lion: courage, wisdom, honor, leadership, loyalty, pride, territorial, generosity, intuition, self-confidence, royalty, dignity, strength, assertiveness, power, justice, authority.
  • Often referred to as the “King of Kings,” white lions are especially rare, and are considered to be divine by many cultures.

Additionally, here are a couple of foundations that he already contributes to:

Question: When will his name be released?

Answer: We’re not sure yet. It could be next week, next month, by the end of 2014, or who knows. Keep checking back (OH the suspense). We do know this: our clients will be the first to hear about it.

Thanks for stopping by, we’re glad that you’re here. Please check back for future updates. Here are a few of our other information outlets:

Home Page: https://policyadvantage.com

Twitter: http://www.twitter.com/PolicyAdvantage

Facebook: http://www.facebook.com/PolicyAdvantage

YouTube: http://www.youtube.com/PolicyAdvantage

Pinterest: http://www.pinterest.com/PolicyAdvantage

Word Press: http://www.policyadvantage.wordpress.com

Covered California: Special Enrollment Period

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Thanks for stopping by today, we’re glad that you’re here. In this blog post we’ll be talking about Covered California’s “Special Enrollment Period.” To keep it simple, this is a period of time when people will be able to enroll in an individual or family health insurance plan outside of open enrollment if certain “life-changing events” are experienced.

Let’s review before we move on: open enrollment for the new Covered California insurance exchange recently finished up. If you’ve been following along, you’ll know that there are now open enrollment periods for individual and family plans both on and off of the new public exchange. In other words, in order to participate in an individual health insurance plan, you’ll now have to enroll during specific times each year. This is called open enrollment.

However, if you experience a qualifying “life-changing event” you may be eligible for a “Special Enrollment Period” in the middle of the year. In other words, yes: you may be able to enroll outside of open enrollment.

Here are some common examples of those qualifying “life-changing events” we described above:

  • Marriage or domestic partnership.
  • Childbirth, adoption, or placing a child up for adoption or in a foster home.
  • Changing your place of permanent residence, therefore gaining access to Covered California plans (this includes moving from another state).
  • Losing your health insurance (ie: losing or changing jobs, losing MediCAL coverage, or COBRA coverage expiration).
  • Changes in income. If you have an income change in the middle of the year, you may be eligible for more (or less) of a subsidy if you’re currently receiving assistance.
  • Becoming a citizen, national, or someone who is residing here legally. This event would only apply to those who were not previously a citizen, national, or legally residing here.
  • An “exceptional circumstance.” Covered California will determine on a case-by-case basis whether-or-not someone may be eligible to enroll via an “exceptional circumstance.”
  • American Indians or Alaska Natives. You are be eligible to change your plan (or enroll in a new plan) up to once per month even if open enrollment is over.
  • Your enrollment was wrong due to the misconduct or misrepresentation of your health insurance company, Covered California, or a Covered California entity (ie: a Certified Enrollment Counselor).

The above listed are examples of common “life-changing events” that might make someone eligible for a “Special Enrollment Period” outside of open enrollment.

Question: How long do I have to enroll if I experience one of these “life-changing events?”

Answer: You have 30 to 60 days (depending on the event). For example, if you lose your job-based coverage, you have 30 days. However, many of the other events give you 60 days. Make sure you know which event occurred, and how much time you have to enroll. 

If you think you’ve experienced a “life-changing event” and are eligible for the “Special Enrollment Period,” please contact us anytime. As a “Certified Insurance Agent,” Policy Advantage Insurance Services is able to help you find plans both on and off of the Covered California exchange (please note: the “Special Enrollment Period” rules do also apply to plans off of the exchange).

Thanks for stopping by, we hope you found our information to be valuable. Check back at our blog to get further information about funding healthcare. Also, please share with your friends, clients, colleagues, and family. Here are a few of our other information outlets:

Home Page: https://policyadvantage.com

Twitter: http://www.twitter.com/PolicyAdvantage

Facebook: http://www.facebook.com/PolicyAdvantage

YouTube: http://www.youtube.com/PolicyAdvantage

Pinterest: http://www.pinterest.com/PolicyAdvantage

Word Press: http://www.policyadvantage.wordpress.com

Covered California: SHOP (Small Business Health Options Program)

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Thanks for stopping by today, we’re glad that you here. Today we’re going to talk about the Covered California SHOP program, otherwise known as the Small Business Health Options Program.

As you know, Covered California is the new state health insurance exchange in the state of California. The new exchanges were a major part of healthcare reform, and were designed to help extend health insurance coverage to eligible individuals and businesses. There are two different programs available at Covered California:

  1. Individual & Family Plans (IFP): these are plans that you enroll in outside of an employer (or group) plan. They are available with APTCs (or subsidies) at the exchange. These subsidies make premiums more affordable.
  2. SHOP (Small Business Health Options Program): these are group health insurance plans through Covered California that are available to qualified businesses. Depending on the size and average income of your business, you may be eligible for tax credits that can help reduce the cost of coverage. 

Many of you are probably familiar with the individual plans that are available through the exchange (option #1 above). A lot of you probably even enrolled — over 1.2 million people in California participated during the exchange’s first open enrollment period that just ended.

Even though you might be familiar with individual health plan enrollment at the exchange, this article is about option #2 above. Covered California can also help small businesses. 

SHOP

If you’re a small business owner (especially in a group with less than 25 FTEs), you may want to take a close look at Covered California’s SHOP. This program is specifically designed to help small businesses offer coverage. Here are some important facts about the SHOP:

  • It’s a new marketplace through the Covered California exchange designed specifically for businesses with 1-50 eligible employees.
  • Employers under 50 FTE are not required to provide health insurance, but this program could be a good option.
  • Important: unlike individual enrollment, Covered California SHOP enrollment is open all year in 2014. So, request information and a quote anytime this year.
  • An eligible full-time employee is an employee that works 30hrs per week or more for the month. An eligible part-time employee is an employee that works 20hrs per week or more for the month.
  • To be eligible for SHOP, an employer must provide a minimum 50% contribution to employee plans.

Question #1: What businesses are eligible for a tax credit?

Answer #1: Businesses that 1) have fewer than 25 FTE for the year, 2) have an annual average wage of less than $50,000 per FTE, and 3) who pay at least 50% of their employees’ premium costs.

Question #2: How much is the tax credit?

Answer #2: Starting in 2014, the maximum tax credit for businesses as a percentage of insurance premium expense is 50% (or up to half of your premium). The maximum tax credit for tax-exempt organizations as a percentage of insurance premium expenses is 35%. These premium subsides are available for two consecutive years.

As a small business owner, it’s a great idea to talk with a Covered California “Certified Agent” about this program. They can run a quote for you. You may be eligible for substantial premium savings. Policy Advantage Insurance Services is certified and can help you with your questions. Feel free to contact us anytime. For more information about SHOP, please visit their official FAQ page here.

Thanks for stopping by, we hope you found our information to be valuable. Check back at our blog to get further information about funding healthcare. Also, please share with your friends, clients, colleagues, and family. Here are a few of our other information outlets:

Home Page: https://policyadvantage.com

Twitter: http://www.twitter.com/PolicyAdvantage

Facebook: http://www.facebook.com/PolicyAdvantage

YouTube: http://www.youtube.com/PolicyAdvantage

Pinterest: http://www.pinterest.com/PolicyAdvantage

Word Press: http://www.policyadvantage.wordpress.com

 

 

Phrases Made Easy: “Advanced Premium Tax Credits” (APTCs)

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Welcome back to another edition of “Phrases Made Easy.” This series at our blog aims to help make all of those long, drawn-out insurance phrases easier to understand. One thing we notice when talking about health insurance (and health benefits in general) is that the concepts can be “wordy” and boring. We emphasize fixing that here.

Today we’re going to talk about “Advanced Premium Tax Credits” (or APTCs). And we’ve got great news for you: this one is really easy.

If you’ve enrolled in a health insurance plan at the new health insurance exchanges, there’s a pretty good chance that you’ve already put “Advanced Premium Tax Credits” to work. We’re going to give you the long version of the definition first. This one comes directly from www.healthcare.gov (*note: skip below the “Easy St” sign if you want to make this easier):

The Affordable Care Act provides a new tax credit to help you afford health coverage purchased through the Marketplace. Advance payments of the tax credit can be used right away to lower your monthly premium costs. If you qualify, you may choose how much advance credit payments to apply to your premiums each month, up to a maximum amount. If the amount of advance credit payments you get for the year is less than the tax credit you’re due, you’ll get the difference as a refundable credit when you file your federal income tax return. If your advance payments for the year are more than the amount of your credit, you must repay the excess advance payments with your tax return. Also called premium tax credit.

Easy

OK. That was pretty wordy. Now let’s make this easy. Here’s what you need to know about “Advanced Premium Tax Credits” (or APTCs):

  • APTCs are the health insurance “subsidies” that you hear so much about.
  • They are credits that make your premiums more affordable if you purchase insurance through the new exchange.
  • The APTCs that you may qualify for are based on FPL or “Federal Poverty Level” (we made that phrase easy one time before, go check it out).
  • The more money that you make, the less of a monthly APTC you will get.
  • The less money that you make, the more of a monthly APTC you will get.
  • If you get too much credit for the year (because you under-stated your income), you’ll have to pay it back at tax time.
  • And (you guessed it), if you don’t get enough credit for the year (because you over-stated your income), you’ll get a credit at tax time.

The moral of the story: APTCs are really what makes individual health insurance “affordable” in the Affordable Care Act. They’re government tax credits that are designed to make health insurance premiums less expensive.

In certain exchanges (like Covered California), when you shop and compare plans (using their “Shop & Compare Tool“), they will apply the APTCs you may eligible for, and give you your total monthly premium estimate. This estimate is based on four factors:

  1. Number of People in the Household
  2. Ages of People in the Household
  3. Yearly Household Income
  4. and Zip Code

Once again, if you want to see an example, look at Covered California’s “Shop & Compare Tool.” Once you input the factors listed above, you’ll be able to see what kind of APTC you may qualify for.

Thanks for stopping by, we hope you found our information to be valuable. Check back at our blog to get further information about funding healthcare. Also, please share with your friends, clients, colleagues, and family. Here are a few of our other information outlets:

Home Page: https://policyadvantage.com

Twitter: http://www.twitter.com/PolicyAdvantage

Facebook: http://www.facebook.com/PolicyAdvantage

YouTube: http://www.youtube.com/PolicyAdvantage

Pinterest: http://www.pinterest.com/PolicyAdvantage

Word Press: http://www.policyadvantage.wordpress.com