As the first day of October is fast approaching, state and local insurance agencies are preparing to navigate around the new healthcare marketplace exchange.
The marketplace is part of the Patient Protection and Affordable Health Care Act signed by President Barack Obama. The plan is to allow uninsured North Carolinians the opportunity to receive healthcare at a reduced rate.
“The exchange is a marketplace and it’s a clearinghouse companies can participate in,” said Matt Rumfelt, a health insurance agent for Lifestore. “They have to be certified by the government that they meet 10 essential benefits.”
The 10 essential benefits include basics such as ambulatory patient services, emergency services and hospitalization, but also include pediatric services and maternity services.
A majority of the population qualifies for the healthcare within the marketplace. Requirements are applicants must be U.S. citizens, not be incarcerated and immigrants must be legal aliens. There are some exemptions are given to members of Indian tribes and those with religious objections.
Those who make between $12,000 and $40,900 a year will qualify for subsidies on their insurance. Those making under $12,000 qualify for Medicaid.
“Subsidies pay for a portion or all of your premiums,” Rumfelt said.
Rumfelt said that the incomes which will provide people subsidies, will apply to most in Ashe County and the Appalachian region.
There will be two types of subsidies provided, premium assistance and cost-sharing assistance. Premium assistance will help those with incomes between 100 percent and 400 percent above the poverty line, while cost-sharing assistance will cover those who earn less than 250 percent of the poverty line.
Poverty lines are based on the number of people in a household.
According to the U.S. Department of Health and Human Services, a one person household has a poverty line of $11,490, while a four-person household has a poverty line of $23,550.
Difficulties navigating the system
Two different companies will be providing options to citizens of Ashe County who are uninsured. They are: Blue Cross and Blue Shield of North Carolina and Coventry Care of the Carolinas.
While both cover Ashe County, some counties on the eastern side of the state will only have Blue Cross Blue Shield as an option.
At first, people are going to have to guess their income in order to qualify for the subsidies within the marketplace.
“We’re just going to have to predict your income to start with,” Garry Elliott, owner of Barr Insurance in Jefferson said. “You won’t know if you’ll get money back or will have to pay more until the next year. Everybody is still learning about (the system.)”
Right now, health insurance brokers are waiting for rate matrixes, which will determine the cost of insurance. The matrix for rates throughout the state will vary because the cost of insurance will fluctuate between zip codes. So, for example, a 27-year-old man living in Charlotte will have a different rate than a 27-year-old man living in West Jefferson.
Rumfelt said there are no rates given for Ashe County, but a rate for Boone has been produced.
“Some of the example rates we have seen so far are near here,” Rumfelt said. “The closest town is Boone. Unfortunately, Boone and Gastonia seem to have the highest rates in the state.”
Insurance agents will get the rate matrix on Oct. 1, the day people can start applying for the health plans in the marketplace. Rumfelt said that puts him and other agents in a frustrating position.
“Typically when something like (new plans) are rolled out, as an agent, we get the opportunities to get in the system, become familiar with it and train,” Rumfelt said. “That way, we know the system inside and out by the time we’re ready to launch. In this case we’re not getting any of that.”
Because of the delays, there are a lot of unknowns about what prices will be or how premiums will work.
“I’m afraid to say, I don’t want to mislead anybody, so I’m going to wait until that time (when the rates are released),” Elliott said.
Other difficulties have come through how agents could tell how much of a subsidy applicants will get. Originally, the plan was to enter a social security number in a system and a response be given in 20 minutes, but as the starting date approaches, the system is not ready.
Instead, people will give their information through an honor system, which will be verified at a later date. Rumfelt said this leaves potential for many to attempt to take advantage of the new system.
“Anytime you do anything on the honor system, there are going to be a lot of problems,” he said.
Ultimately, there are going to be several bumps in the road, and what was planned to be an easy transition, will not happen.
“I really hate it for the first person who walks in my office and we wait and see what happens,” Rumfelt said. “The first person will probably be handpicked because they are going to have to put up with frustration.”
Fortunately, plans won’t be fully required until January of 2014.
“Between October and Jan. 1, we have a lot to learn in my opinion,” Elliott said.