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FAQ

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When does the new health care reform take effect?

 

President Obama signed HR 3590, the Patient Protection and Affordable Care Act into law on March 23, 2010. The President also signed HR 4872, the Health Care and Education Reconciliation Act, into law on March 30, 2010. Together, these acts provide staggered time frames within which many of the changes go into effect. Some of the changes took effect immediately, while others will be phased in through 2020.

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Will we see better value or lower costs?

 

Yes. According to the CBO, Americans buying the same coverage they have today in the individual market will see premiums fall by 14 to 20 percent compared to what they would pay today without health insurance reform. It is estimated that it will reduce family health insurance premiums in Colorado by $1,510 - $2,160. This is because reform will accomplish two important things: cover more people and reform the insurance market to increase competition and administrative savings.

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What if we did nothing?

 

If people like the plan they have, they can keep it. If they like their doctor, nothing in this plan takes that choice away. But they’ll have more consumer protections that give them greater control.

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What about people who are afraid of losing what they have?

 

If people like the plan they have, they can keep it. If they like their doctor, nothing in this plan takes that choice away. But they'll have more consumer protections that give them greater control.

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What does this reform do for Coloradans?

 

It ends the worst insurance company practices and outlaws discrimination against Americans with pre-existing conditions; It reduces costs for people with insurance and makes coverage more affordable for people without it today; It sets up a new competitive insurance marketplace where small business owners and families get the same buying power and insurance choices that all members of Congress will have to allow them to shop for the insurance plan that works best for them; and It increases the number of Coloradans with health care coverage.

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How will this impact the number of uninsured Coloradans?

 

Colorado currently has an estimated 750,000 - 770,000 uninsured residents. With the implementation of the Act, we anticipate another 500,000 people having access to coverage through the coverage expansions and through the Exchange. This will dramatically decrease the numbers of uninsured in Colorado.

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What type of coverage will be offered through the exchanges and when will it be available to purchase?

 

The new law creates two types of state-based exchanges. The American Health Benefit Exchanges, through which individuals may purchase qualified coverage, and the Small Business Health Options Program (SHOP), through which small businesses with up to 100 employees can purchase qualified coverage. States may choose to create one exchange program that serves both individuals and small businesses. The qualified coverage will be determined by the Department of Health and Human Services (HHS). Beginning in 2017, states may allow businesses with more than 100 employees to purchase coverage in the SHOP exchanges. Starting January 1, 2014, four categories of plans plus a separate catastrophic plan will be offered through the exchanges. Each category of plans will offer essential benefits as determined by HHS. Plan benefits, premiums, and enrollee out-of-pocket expenses will vary depending on the plan chosen. Plans will cover 60 to 90 percent of medical expenses, depending on which plan an enrollee selects.

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Is there a provision for an interim federal health risk pool that will provide coverage for preexisting conditions? When does it begin?

 

No later than 90 days after enactment, the law creates a federal high-risk program to provide coverage for people who have been uninsured for six months and have a preexisting condition. This program will provide insurance coverage until 2014, when insurance companies can no longer deny you coverage based on your health. The Department of Health and Human Services is working with states to allow existing state health risk pools to also provide insurance to those who qualify for coverage under the federal reform legislation. Premium costs for participants will be comparable to what an individual without preexisting conditions would pay to purchase insurance from the commercial insurance market. Although at a higher rate, CoverColorado currently offers health coverage to Coloradans who have preexisting conditions. Those individuals enrolled in the pool are not eligible for the new federal program because they do not meet the requirement that individuals must be uninsured for at least six months to qualify.

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Will the healthcare reform help cover my Medicare prescription drug costs that are not currently covered (i.e. the "donut hole")?

 

This "donut hole" is a coverage gap under Medicare Part D. Effective for calendar year 2010, the new health care reform provides a $250 rebate to Medicare beneficiaries who have prescription drug costs to reimburse them for prescription drugs that were purchased within the "donut hole" in 2010. Beginning in 2011, Medicare enrollees will receive a 50 percent discount on prescription drugs in the "donut hole," and the discount increases each year until the coverage gap is eliminated entirely in 2020.

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When does free preventive care start and will it affect my plan?

 

In 6 months, all new group health plans and new plans in the individual market must provide coverage for preventive services. Recommended prevention and vaccination services will be covered without any deductibles or copayments. Seniors enrolled in Medicare will also no longer have to pay for proven preventive services.

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My insurance company wants to raise my rates. What recourse do I have?

 

There are several provisions in the new legislation that are designed to make insurance more affordable and provide oversight of rate increases. Beginning in 2010, all insurers must comply with new standards that require them to pay out a minimum percentage of their premiums for claims costs and services that are directly related to improvement of health care quality. Insurance companies will be required to give money back to consumers if they do not meet those standards, with the first rebates due in 2011.

Individuals who receive a rate increase that they disagree with may file a complaint with The Division of Insurance, http://www.dora.state.co.us/insurance/. However, the federal law does not give states the authority to reject requested rate increases, but requires states to follow the process for rate approval that already exists within the state. When the insurance exchange is created in 2014, insurers who have submitted unreasonable rate requests may not be able to participate in the exchange.

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When will I be required to buy insurance and what happens if I don't?

 

Effective January 1, 2014, all U.S. citizens and legal residents will be required to obtain qualifying coverage. Those who do not obtain coverage will pay a tax penalty. The total annual tax penalty will be the greater of either a flat dollar amount or a percentage of taxable income: $95 per person or 1 percent of taxable income in 2014, $326 per person or 2 percent of taxable income in 2015, and $695 per person or 2.5 percent of taxable income in 2016. A person will only pay one-twelfth of the total annual penalty for each month without coverage and will not have to pay more than the national average cost for bronze-level coverage through the state exchanges. After 2016, the tax penalty increases annually based on a cost-of-living adjustment.

The law provides exceptions for: 1) individuals and families below a certain income, 2) people who cannot afford coverage that is available, 3) individuals who have been uninsured for less than three months, 4) members of Indian tribes, and 5) people who do not obtain coverage because of religious objections. The U.S. Department of Health and Human Services will provide additional guidance on this topic in the future.