The Affordable Care Act is Here!
By Tucker Thompson, Collin County LIVING WELL Magazine
Beginning Oct. 1, 2013, people under the age of 65 can sign up for the new Affordable Health Care Act with coverage effective Jan. 1, 2014. This will not cut Medicare benefits.
The Affordable Care Act requires all health insurance companies covering people under the age of 65 to follow the Medical Loss Ratio of 80/20. At least 80% of premiums received on health care services must be used to pay doctors and hospital bills, as well as covered activities prescribed to improve health care quality and patient safety. No more than 20% of premiums may be spent on administrative costs such as salaries, sales, and advertising. This rule is calculated on a state-by-state basis. The health care companies must give a rebate to you by Aug. 1, 2014 or apply this rebate to your premium for the month of August if they did not meet the 80% Medical Loss Ratio standard.
Health care plans under the Affordable Care Act will not be taxed. Employers must report on the W2 tax form the value of your annual coverage for workers’ information. There will be an annual cap on your out-of-pocket spending for medical claims, but no cap on a person’s lifetime benefit coverage.
Tobacco users will pay a 10% higher premium than non-tobacco users. Unisex rates along with a person’s age will also help calculate the premium for these new insurance plans.
The annual open enrollment period for Medicare Prescription Drug Plans and Medicare Advantage plans begins Oct. 15 and ends Dec. 7, 2013. These plans run from Jan. 1, 2014 through Dec. 31, 2014. In 2014, the deductible for drug plans can be $0 to $310 depending on the plan you choose. There is speculation that Advantage plans may scale back benefits and/or increase cost sharing in response to reductions in Medicare payments.
Medicare Supplement plans can be changed at any time of the year with health questions required. The F Plan is still the most popular with no deductibles and only a co-payment for medically necessary emergency care during foreign travels.
Tucker Thompson, the author, has worked in the insurance field for over 20 years. He’s often a guest speaker on topics related to the ever changing landscape of healthcare laws and medical insurance. His time is also filled consulting with people that just want to review their current coverage to make sure they still have the best coverage for their needs.