Price is always foremost on the minds of Texas consumers when shopping for health insurance. At the same time, consumers typically want the most coverage for the least amount of premium. You can immediately see that there exists a significant conflict when the need is affordable health insurance. Finding affordable health care in Texas can be accomplished achieved, but dependent on the level of coverage needed or your coverage requirements, either through an Affordable Care Act (ACA) plan or short-term coverage if ACA coverage is too expensive.
The Affordable Care Act (ACA) May Provide Some Relief
One of the principal justifications for approving the ACA in March 2010 was the need to stabilize premium cost for consumers through increased competition, more diligent government oversight and premium subsidies for eligible policyholders. In addition to addressing the need for affordable health insurance, the legislation also included consumer protections such as guaranteed issue, expanded benefit access with essential benefit requirements, and eliminating annual and lifetime benefit caps. Stabilizing premium cost was the major goal of the legislation because it was believed that by reducing health insurance cost, the number of uninsured Americans would be reduced and access to care would be expanded.
Increased Competition Fosters Affordable Care
ACA created health insurance exchanges, also known as marketplaces, which is an online portal where Texas consumers can research, review and shop for health insurance in their state. The state marketplaces have attracted health insurance carriers and have increased the number of plan options for consumers. All individual plans can be purchased either as “On-Exchange” with a subsidy, a government tax credit based on your annual household income, or “Off-Exchange” without a subsidy. If you’re eligible for and want to use the qualified subsidy to offset your monthly premium costs, On-Exchange plans are purchased through the government-created marketplaces, like the Federally-Facilitated Marketplace (healthcare.gov), or a state-based marketplace. Conversely, the Off-Exchange plans are offered privately by each health insurance company. The plan designs are basically the same, whether Off-Exchange or On-Exchange, with the number one benefit of shopping Off-Exchange being a simplified application process.
Regulatory changes such as guaranteed issue and elimination of preexisting conditions have also increased coverage options and competition by allowing consumers to switch from one carrier to another. Previously, health conditions may have restricted a consumer’s options for coverage. Now since these practices have been eliminated, consumers can move from one carrier to another during enrollment periods, which creates increased completion.
Affordable Care through Increased Government Oversight
ACA has given the federal government a much more active role in the review and approval of health insurance plans and their premiums. Prior to ACA, health insurance regulation was the responsibility of each state. The McCarran-Ferguson Act, passed in 1945, established that the states are the primary regulator of insurance. The McCarran-Ferguson Act was in response to state and industry concern over a U.S. Supreme Court decision rendered in 1944 (U.S. v. South-Eastern Underwriters Assn., 322 U.S. 533 (1944)) which stated that insurers conducting a substantial part of their business across state lines were engaged in interstate commerce and thereby subject to federal antitrust laws. McCarran-Ferguson specified that federal law which does not specifically regulate the business of insurance would not preempt a state law enacted for that purpose.
Health and Human Services Department (HHS) and Centers for Medicare and Medicaid Services (CMS) were given principal oversight responsibilities by ACA for each state’s health insurance market. The federal government has review and approval responsibility for plans and the premiums charged in each state. The federal government issued grants to provide the resources for the states to expand their role in the review of plans and rates.
Additional rate review actions were adopted by the federal government requiring health insurance carriers to post on their websites easy-to-understand information and the justifications for unreasonable rate actions as determined by the federal government.
Premium Subsidies Promote Affordable Care
Beginning January 1, 2014, eligible policyholders will receive financial assistance in paying their monthly healthcare premium. Individuals and families who meet defined income requirements will be able to receive premium subsidies and financial assistance for out-of-pocket expenses.
The goal of the subsidies is to help consumers who cannot access affordable coverage either from employers or from the private insurance market by having the federal government pick-up a portion or all of the monthly premium.
Eligibility for the subsidies and financial assistance with out-of-pocket expenses will be determined by comparing an individual’s or family’s gross income to the federal poverty level (FPL). The level of assistance will be determined by the percentage of gross income to the FPL as determined by the number of family members.
|Persons in Family/Household||Federal Poverty Level (Low)||Federal Poverty Level (High)|
Subsidies will be available according to ACA rules for individuals and families with incomes ranging from 100% to 400% of the FPL. The subsidies will be used to reduce the premium cost for health insurance coverage offered within the health insurance marketplaces. In addition, financial assistance will be available for out-of-pocket healthcare expenses for those with incomes ranging from 100% to 250% of the FPL. Examples of these out-of-pocket costs include copays and deductibles that would typically be the responsibility of the policyholder.
The 2021 FPL is $12,760 for a one-person household and increases by $4,480 for each additional family member. The FPL benchmark will be adjusted for inflation each year. The Congressional Budget Office estimates that 6 million participants will take advantage of the premium subsidies during 2021 enrollment.
STATESIDE CAN HELP!
Stateside Insurance Services, since 2003, has focused on providing comprehensive health insurance information, responsive customer service and expert industry knowledge for Texas consumers. Stateside has annually been recognized by health insurance carriers and the Health Insurance Marketplace as a Top Producer in Texas.
Whether the health insurance policy is for an individual, family, small business or supplemental Medicare coverage, Stateside dedicates the time, and our deep industry expertise, to ensure our clients have identified the best health insurance plan for their specific needs.
Stateside is available to answer any general questions regarding your coverage options, can provide a subsidy determination, and even assist in creating and submitting online applications for ACA compliant plans during an Open Enrollment or throughout Special Enrollment periods.
By using the Telephone Appointment System, clients can take advantage of scheduling a health insurance discussion when convenient for their schedule. During Open Enrollment phone appointment availability is expanded to include extended hours and weekends.