Posts

Insurance Alphabet: Letter E

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E is for:

“Exchange”

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Exchange: When used as a noun, an exchange is a place where goods or services are bought or sold. In this blog post, we’re specifically referring to exchanges that sell major-medical health insurance policies. These are otherwise known as health insurance exchanges.

The reason that we’ve selected this topic is because you’re going to hear a lot about “exchanges” over the next few years (and into the future in general), when it comes to health insurance. There are two types of health insurance exchanges:

  1. Public Health Insurance Exchanges
  2. Private Health Insurance Exchanges

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A Public Health Insurance Exchange is an exchange that is set up, funded, and administered by the government. There are a combination of ways that this takes place:

  • A) State-only administered exchanges.
  • B) Joint state/federally administered exchanges.
  • and C) Exchanges administered by the federal government only.

Public Health Insurance Exchanges were a large part of healthcare reform (ACA/Obamacare). These are the new exchanges that are mandated by the law. The purpose of these exchanges is to help expand affordable coverage to the uninsured. The state exchange in California is called “Covered California.”

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A Private Health Insurance Exchange is an exchange that is set up, funded, and administered by private parties. In other words, the government is not involved (examples of private parties: employers and their employees).

There are a number of different strategies when setting up a Private Health Insurance Exchange. Most of these strategies revolve around the “defined contribution” health planning concept that we’ve discussed in past blog posts. This concept (defined contribution) is gaining importance as we move forward in health benefits planning. Third party administrators (or TPAs) facilitate the administration of Private Health Insurance Exchanges.

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:

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Benefits Chalk Talk: State Health Insurance Exchanges

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There are lots of questions about state health insurance exchanges, and where/how they will fit in. In this “Benefits Chalk Talk” post, we’re going to give you some 101 (simple) insight into these exchanges, what they’re about, and how they’ll work.

A state health insurance exchange may or may not be the right option for your personal (or business) situation, but it’s a good idea to understand them. Consider them another “tool in your belt” to fund healthcare.

HealthBenefitsChalkTalk1

First off, here are some basic facts and information about these new exchanges:

  • State-based health insurance exchanges (or marketplaces) are a key component of the Affordable Care Act (ACA)
  • States have the option of running their own exchange, or partnering w/ the federal government to run an exchange (or choosing neither, and a federally facilitated exchange will be set up)
  • All exchanges must be ready to enroll customers by 10/1/2013, and be fully operational by 1/1/2014

State health insurance exchanges may be an important part of an individual or business benefits planning strategy. Although some businesses and individuals may make the decision to completely steer clear of the exchanges, others who are open to the idea of utilizing government options will want to learn more.

When it comes to healthcare reform (love it or hate it), it’s important to understand that Policy Advantage Insurance Services takes an unbiased (non-political) approach to these concepts. Our goal is to deliver fact-based information to our clients, so they can put the things in place that make the most sense.  

Health Insurance Exchange

Here is some additional information about the exchanges:

  • Plans offered within the exchange must be the same (contain the same benefits), as those offered outside of the exchange
  • Enrollment in plans will take place predominantly online
  • Plans in the exchange will be “guaranteed issue,” meaning you must be accepted for coverage if you apply
  • An “exchange certified” agent or broker can assist you with enrolling in a state health insurance exchange plan (for more details, ask your current agent/broker, or find an agent/broker)
  • There are provisions to lower premiums (through massive subsides), for Americans with household incomes under 400% of the Federal Poverty Level (that’s most Americans)

Here are the early 2012 Federal Poverty Level guidelines. If your yearly earnings fall within 100% to 400% of the FPL, you may be eligible for a tiered subsidy through the exchange:

  • 100% of the Federal Poverty Level (FPL) was $11,170 for an individual and $23,050 for a family of four through early 2012
  • 400% of the Federal Poverty Level was ~$44,680 for an individual and ~$92,200 for a family of four through early 2012

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: www.policyadvantage.com

Twitter: www.twitter.com/policyadvantage

Facebook: www.facebook.com/policyadvantage

YouTube: www.youtube.com/policyadvantage

Pinterest: www.pinterest.com/policyadvantage

Word Press (you are here): www.policyadvantage.wordpress.com