Have you noticed the commercial for that tax preprarer that warns of all the troubles brought on by Health Care reform? Did you see the recent news on how eventually Obama Care will cost cigarette smokers more money in premiums?
As we move deeper into 2013, we get closer to seeing more changes. Buffalo's Early News and WBEN.com take a look Monday .
"2013 is a warmup to what really is going to come (in 2014)
- Roberta Rifkin, VP,
This tax season is one of historical significance. The tax return you are filing is going to be key to determining your health care benefits on the exchange."
--Meg Sutton, senior advisor for tax and health care at H&R Block.
The biggest thing I would tell small business people to be doing this year is talk to their accountant, talk to thier attorney, make sure they are making the right decisions this summer and into the fall
--Mike Durant, NYS Director,
Nat'l. Fed. of Independent Businesses
John Bartimole, WNY Healthcare Assoc.
Sam DiSalvo, Freed Maxick CPAs
Faced with the high cost of caring for smokers and overeaters, experts say society must grapple with a blunt question: Instead of trying to penalize them, why not just let them die prematurely from their unhealthy habits?
Millions of smokers could be priced out of health insurance because of tobacco penalties in President Barack Obama's health care law,
Health insurance exchanges will change the way people buy coverage and will help millions of uninsured people get a private plan. Nearly 49 million people are uninsured in the United States, but the numbers vary dramatically by state.
Exchanges will be the most visible part of President Barack Obama's health care overhaul law in everyday life. Open enrollment starts Oct. 1, less than 10 months away.
Some questions and answers on how the exchanges will work:
Q: What's a health insurance exchange?
A: "Exchange" is just another word for "marketplace." The plans sold in the new markets will start covering patients on Jan. 1, 2014. Each state will have its own exchange serving people who buy their health insurance directly, as well as a separate one for small businesses. The vast of majority of people now covered by employer plans will not see a change.
There will be three types of exchanges at the beginning: those run by states, those run by the federal government, and partnerships. Most Republican governors opposed to "Obamacare" are letting Washington run the exchanges in their states.
For consumers, the benefits should be the same no matter who runs the exchange.
Q: How will exchanges work?
A: Exchanges are supposed to have the feel of an online travel site - think Orbitz or Expedia.
Middle-class people will be able to pick from a range of private insurance plans, and most people will be eligible for help from the government to pay their premiums.
Low-income people will be steered to safety-net programs for which they might qualify. This could be a problem in states that choose not to expand their Medicaid programs under a separate part of the health care law. In that case, many low-income residents in those states would remain uninsured.
Q: How will I know if I can get help with my health insurance premiums?
A: You'll disclose your income to the exchange at the time you apply for coverage and they'll let you know. Only legal residents of the United States can get financial assistance.
The health care law offers sliding-scale subsidies based on income for individuals and families making up to four times the federal poverty level, about $44,700 for singles, $92,200 for a family of four.
But do yourself a favor and read the fine print because the government's help gets skimpier as household income increases.
For example, a family of four headed by a 40-year-old making $35,000 will get a $10,742 tax credit toward an annual premium of $12,130. They'd have to pay $1,388, about 4 percent of their income, or about $115 a month.
A similar hypothetical family making $90,000 will get a much smaller tax credit, $3,580, meaning they'd have to pay $8,550 of the same $12,130 policy. That works out to more than 9 percent of their income, or about $710 a month.
The estimates were made using the nonpartisan Kaiser Family Foundation's online calculator. Some people will also be eligible for help with their copayments.
Final note: Though it's called a "tax credit" the government assistance goes directly to the insurer. You won't see a check.
Q: What will the benefits look like?
A: The coverage will be more comprehensive than what's now typically available in the individual health insurance market, dominated by bare-bones plans. It will be more like what an established, successful small business offers its employees. Premiums are likely to be higher for some people, but government assistance should mostly compensate for that.
All plans in the exchange will have to cover a standard set of "essential health benefits," including hospitalization, doctor visits, prescriptions, emergency room treatment, maternal and newborn care, and prevention. Insurers cannot turn away the sick or charge them more. Middle-aged and older adults can't be charged more than three times what young people pay. Insurers can impose penalties on smokers.
Because the benefits will be similar, the biggest difference among plans will be something called "actuarial value." A new term for consumers, it's the share of expected health care costs that the plan will cover.
There will be four levels of coverage, from "bronze," which will cover 60 percent of expected costs, to "platinum," which will cover 90 percent. "Silver" and "gold" are in between. Bronze plans will charge the lowest premiums, but they'll have the highest annual deductibles. Platinum plans will have the highest premiums and the lowest out-of-pocket cost sharing.
Here's a wrinkle: The government's subsidy will be tied to the premium for the second-lowest-cost plan at the silver coverage level that's available in your area. You could take it and buy a lower cost bronze plan, saving money on premiums. But you'd have to be prepared for the higher annual deductible and copayments.
Buying your own health insurance will never be the same.
This fall, new insurance markets called exchanges will open in each state, marking the long-awaited and much-debated debut of President Barack Obama's health care overhaul.
The goal is quality coverage for millions of uninsured people in the United States. What the reality will look like is anybody's guess - from bureaucracy, confusion and indifference to seamless service and satisfied customers.
Exchanges will offer individuals and their families a choice of private health plans resembling what workers at major companies already get. The government will help many middle-class households pay their premiums, while low-income people will be referred to safety-net programs they might qualify for.
Most people will go online to pick a plan when open enrollment starts Oct. 1. Counselors will be available at call centers and in local communities, too. Some areas will get a storefront operation or kiosks at the mall. Translation to Spanish and other languages spoken by immigrants will be provided.
When you pick a plan, you'll no longer have to worry about getting turned down or charged more because of a medical problem. If you're a woman, you can't be charged a higher premium because of gender. Middle-aged people and those nearing retirement will get a price break: They can't be charged more than three times what younger customers pay, compared with six times or seven times today.
If all this sounds too good to be true, remember that nothing in life is free and change isn't easy.
Starting Jan. 1, 2014, when coverage takes effect in the exchanges, virtually everyone in the country will be required by law to have health insurance or face fines. The mandate is meant to get everybody paying into the insurance pool.
Obama's law is called the Affordable Care Act, but some people in the new markets might experience sticker shock over their premiums. Smokers will face a financial penalty. Younger, well-to-do people who haven't seen the need for health insurance may not be eligible for income-based assistance with their premiums.
Many people, even if they get government help, will find that health insurance still doesn't come cheaply. Monthly premiums will be less than the mortgage or rent, but maybe more than a car loan. The coverage, however, will be more robust than most individual plans currently sold.
Consider a hypothetical family of four making $60,000 and headed by a 40-year-old. They'll be eligible for a government tax credit of $7,193 toward their annual premium of $12,130. But they'd still have to pay $4,937, about 8 percent of their income, or about $410 a month.
A lower-income family would get a better deal from the government's sliding-scale subsidies.
Consider a similar four-person family making $35,000. They'd get a $10,742 tax credit toward the $12,130 annual premium. They'd have to pay $1,388, about 4 percent of their income, or about $115 a month.
The figures come from the nonpartisan Kaiser Family Foundation's online Health Reform Subsidy Calculator. But while the government assistance is called a tax credit and computed through the income tax system, the money doesn't come to you in a refund. It goes directly to insurers.
Obama's law is the biggest thing that's happened to health care since Medicare and Medicaid in the 1960s. But with open enrollment for exchange plans less than 10 months away, there's a dearth of consumer information. It's as if the consumer angle got drowned out by the political world's dispute over "Obamacare," the dismissive label coined by Republican foes.
Yet exchanges are coming to every state, even those led by staunch GOP opponents of the overhaul, such as Govs. Rick Perry of Texas and Nikki Haley of South Carolina. In their states and close to 20 others that are objecting, the exchanges will be operated by the federal government, over state opposition. Health and Human Services Secretary Kathleen Sebelius has pledged that every citizen will have access to an exchange come next Jan. 1, and few doubt her word.
But what's starting to dawn on Obama administration officials, activists, and important players in the health care industry is that the lack of consumer involvement, unless reversed, could turn the big health care launch into a dud. What if Obama cut the ribbon and nobody cared?
"The people who stand to benefit the most are the least aware of the changes that are coming," said Rachel Klein, executive director of Enroll America, a nonprofit that's trying to generate consumer enthusiasm.
"My biggest fear is that we get to Oct. 1 and people haven't heard there is help coming, and they won't benefit from it as soon as they can," she added. "I think it is a realistic fear."
Even the term "exchange" could be a stumbling block. It was invented by policy nerds. Although the law calls them "American Health Benefit Exchanges," Sebelius is starting to use the term "marketplaces" instead.
Polls underscore the concerns. A national survey last October found that only 37 percent of the uninsured said they would personally be better off because of the health care law. Twenty-three percent said they would be worse off in the Kaiser poll, while 31 percent said it would make no difference to them.
Insurers, hospitals, drug companies and other businesses that stand to benefit from the hundreds of billions of dollars the government will pump in to subsidize coverage aren't waiting for Washington to educate the public.
Blue Cross and Blue Shield plans, for example, are trying to carve out a new role for themselves as explainers of the exchanges. Somewhere around 12 million people now purchase coverage individually, but the size of the market could double or triple with the new approach, and taxpayers will underwrite it.
"Consumers are expecting their health insurance provider to be a helpful navigator to them," said Maureen Sullivan, a senior vice president for the Blues' national association. "We see 2013 as a huge year for education."
One goal is to help consumers master the "metals," the four levels of coverage that will be available through exchange plans - bronze, silver, gold, and platinum.
Blue Cross is also working with tax preparer H&R Block, which is offering its customers a health insurance checkup at no additional charge this tax season. Returns filed this year for 2012 will be used by the government to help determine premium subsidies for 2014.
"This tax season is one of historical significance," said Meg Sutton, senior advisor for tax and health care at H&R Block.
"The tax return you are filing is going to be key to determining your health care benefits on the exchange." she says
Only one state, Massachusetts, now has an exchange resembling what the administration wants to see around the country. With six years in business, the Health Connector enrolls about 240,000 Massachusetts residents. It was created under the health overhaul plan passed by former Republican Gov. Mitt Romney and has gotten generally positive reviews.
Connector customer Robert Schultz is a Boston area startup business consultant who got his MBA in 2008, when the economy was tanking. Yet he was able to find coverage when he graduated and hang on to his insurance through job changes since. Schultz says that's freed him to pursue his ambition of becoming a successful entrepreneur - a job creator instead of an employee.
"It's being portrayed by opponents as being socialistic," Schultz said.. "It is only socialistic in the sense of making sure that everybody in society is covered, because the cost of making sure everybody is covered in advance is much less than the cost of putting out fires."
The Connector's executive director, Glen Shor, said his state has proven the concept works and he's confident other states can succeed on their own terms.
"There is no backing away from all the challenges associated with expanding coverage," Shor said. "We are proud in Massachusetts that we overcame what had been years of policy paralysis."
GLOSSARY: President Barack Obama's health care overhaul law has spawned its own jargon. With the law finally about to take full effect, consumers might want to get familiar with some of the terms:
Affordable Care Act - The most common formal name for the health care law. Its full title is the Patient Protection and Affordable Care Act, or PPACA, pronounced (Pea-PUH-kah). Opponents still deride the law as "Obamacare," but Obama has embraced that term, saying it shows he cares.
Employer mandate - A federal requirement that companies with 50 or more workers pay a penalty to the government if one of their workers obtains taxpayer subsidized coverage through the law. Effective Jan. 1, 2014. Intended to keep companies from "dumping" employees into public coverage.
Individual mandate - A federal requirement that virtually everyone in the United State has health insurance, either through an employer, a government program or by buying his own plan. Effective Jan. 1, 2014. Exemptions for financial hardship and religious objections. Does not apply to illegal immigrants. People who ignore the mandate will face fines from Internal Revenue Service.
Essential health benefits - Basic health benefits that most plans will have to cover starting in 2014. They include office visits, emergency services, hospitalization, rehab care, mental health and substance abuse treatment, prescriptions, lab tests, maternal and newborn and pediatric care.
Exchanges - Online marketplaces where consumers can get private health insurance, subsidized by the government. Open enrollment starts Oct. 1, and coverage takes effect Jan. 1, 2014. Exchanges can be run by the states, the federal government, or a state-federal partnership. Small businesses will have access to their own exchanges.
Medicaid expansion - The health care law also expands Medicaid to cover more low-income people--accounting for close to half of those who eventually will gain coverage .The federal government will pay the full cost of the new coverage from 2014-2016, then phase down to 90 percent.
Metal levels -The four levels of coverage available through exchange plans, called bronze, silver, gold, and platinum. Bronze plans feature the lowest monthly premiums, but cover only 60 percent of average costs. Platinum plans cover 90 percent of expected costs.
Tax credits - Government health insurance subsidies for individuals will come in the form of tax credits. The money will be paid directly to the consumer's health plan. The subsidies are based on income. Each year, people will have to "true up" with the IRS to make sure they got the right amount. People who receive too generous a tax credit may owe money back to the government.
Tax penalty - The fine levied on individuals who disregard the individual insurance mandate. It starts small and gets bigger in subsequent years. In 2014 it's $95 or 1 percent of taxable income. By 2016, it's $695 or 2.5 percent of taxable income, whichever is greater. Thereafter it's adjusted for inflation.