- Written by I. Mandate
Obamacare Facts In The New Health Insurance Marketplace
If the individual mandate is the heart of The Affordable Care Act, the health insurance marketplace is the backbone. The Affordable Care Act is the new federal health reform law that regulates the American healthcare system. Many of these new regulations address the health insurance product and marketplace. The insurance exchange authority in each state will qualify, quantify and approve the various health insurance carriers and their plans to be placed in the new marketplace exchange. The insurance exchange will provide regulated health plans that include essential health benefits, affordable tax credit subsidies while qualifying citizens for what health plans, subsidies or government programs that are available to them.
One stop shopping providing health insurance for both the individual and the small business market (SHOP exchange). Exchanges will provide a detailed and comprehensive choice of health plans that will be packaged at similar benefit levels with their prices for clear apple to apple comparisons. All of this consumer convenience delivered via the internet while you sit comfortably at your home PC drinking your coffee.
"One of the most innovative and promising features of the ACA is the creation of Health Insurance Exchanges that will serve as marketplaces where individuals, families, and small businesses can purchase health insurance. In 2022, twenty-five million people are expected to purchase health insurance through Exchanges. Exchanges will offer a single website for residents of each state to find, compare, and select health plans. Consumers can trust that the health benefits offered by Exchange plans meet minimum standards of coverage and quality as all the plans are required to cover at least the federally-determined essential health benefit. Plans will be grouped into metallic tiers and depicted side-by-side which should reduce the time needed to sort through options."
Employer Health Plans Have Lost Their Edge
How sweet is this? Gone will be the days where consumers, lacking professional insurance expertise had to rely on the word of an insurance salesman being paid commissions or whatever information they could dig up on the Internet while trying to make an educated guess at best. To be fair, I am primarily talking about the individual market, not the person afforded a employer health plan at their work. Now with health care reform, that employee with employer-sponsored health insurance won't have near the choices or advantages afforded the to the individual in the health insurance exchange, thanks to Obamacare. Also, those below 400% of the poverty income level for individual or family will have access to affordability tax credits, that's right government subsidies similar to the subsidies that the people with employer sponsored health plans receive only difference more straight forward. The employer-sponsored coverage is subsidized with tax loopholes for both the employer and the employee.
Employer health plans have also lost their advantage in the guaranteed issue department. The individual health insurance market used to be subject to underwriting where the insurance companies had a choice of accepting, revising terms or flat-out rejecting the policy applicant at their whim. Starting in 2014 this type of underwriting will be a thing of the past, all insurance carriers will have to provide guaranteed issue to applicants regardless of pre-existing conditions or medical history. Another huge advantage to Obamacare is health insurance portability, insurance coverage not dependent or reliant on your employer. I have a feeling group employer health insurance is never going to be viewed quite the same again. As a matter of fact, I see a big future for a "free choice option", where employees choose between their employer sponsored health plan or those in the health insurance exchange.