Coffeepot Chatter: Affordable Care Act Confusion

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Tuesday, September 17, 2013

Maria (to her peers): In the news this week: Bill Clinton will be speaking about the Affordable Care Act and remembering Hurricane Katrina. Why do I feel like a resident of New Orleans prior to Katrina when it comes to the Affordable Care Act? Bracing for the worst, yet hoping for the best.

Harry: No need to worry Maria.

Tom: Yeah, we’ll just be getting an additional option for open enrollment.

Harry: What’s that Tom?

Tom: You know, the government-run insurance plan, along with our normal options at Lehigh.

Harry: No such thing, Tom. Initially the health care reform law will require all Americans to have health insurance. There will be health insurance marketplaces for people without insurance to shop for an individual plan.  And the government will provide financial help for low income Americans and tax credits to small businesses offering health care to employees, but there’s no national plan. 

Tom: Hmmm, guess I need more information on this.

Maria: Me too, Tom!  


Confusion At The Coffeepot

If you’re like Maria and Tom, you’ve probably been hearing a lot of bits and pieces about the Affordable Care Act (aka ACA, Health Care Reform or Obamacare). It’s also possible that since you have health insurance through Lehigh, you haven’t been paying very close attention as the law gets closer to full implementation.

So, you may be just as confused as they are about the new Health Insurance Marketplace and federal tax credits that are beginning to be discussed in the news. Let’s clear things up for everyone.


The Health Insurance Marketplace

In 2014, key parts of the Affordable Care Act will take effect. This includes a new way to purchase health insurance through the Health Insurance Marketplace (also referred to as “Exchanges.”).

For Americans who don’t have access to affordable health insurance coverage, the marketplace will offer a variety of health insurance plans to meet their varied needs and budgets. All plans in the marketplace will meet minimum value standards. 

The marketplace offers one-stop shopping to find and compare private health insurance options. Some individuals may also be eligible for a new kind of tax credit that lowers their monthly premium right away.

Health Insurance Marketplaces will open for consumers to begin shopping for plans on October 1, 2013 for plans that take effect January 1, 2014.


Who Qualifies For Tax Credits or Subsidies

The Affordable Care Act provides tax credits and subsidies for people who qualify, to help make insurance more affordable when they shop through the Marketplace. Individuals may be eligible for tax credits or subsidies if:

1.    Their employer does not offer coverage,
2.    The coverage offered by their employer does not meet certain “minimum value” standards, or
3.    The cost of the employer health insurance coverage that would cover them (not including members of their family) is more than 9.5 percent of their household income for the year.


What This Means For Lehigh Employees

Here’s the important point:

Because Lehigh will continue to offer health insurance plans that exceed the minimum value standard set by the ACA, benefits eligible (75 percent effort and higher) Lehigh employeeswill not qualify for federal tax credits or subsidies for the purchase of health insurance through the Marketplace. 

As in previous years, you will be able to select the medical insurance that fits your needs during Lehigh’s Open Enrollment period.  Open Enrollment is also your opportunity to make changes to your dental, supplemental life insurance, and Health and Dependent Care spending accounts. This year, Open Enrollment will run from November 1 through 15. 


For More Information

If you’d like more information about the Affordable Care Act, we recommend two websites to explore:

•    The Kaiser Family Foundation offers in-depth information about the law and about its impacts on health insurance costs and coverage.
•    Healthcare.Gov is the federal government’s official website for the Affordable Care Act and its implementation.