Affordable Care Act in Kansas The

The
Affordable Care
Act in Kansas
What is the Affordable Care Act?
The Affordable Care Act (ACA) was enacted into
law on March 23, 2010. This law is sometimes called
“PPACA” or simply “health care reform.” The law
addresses and attempts to fix problems in the current
American health care system. Some of these problems include the cost and quality of care and gaps in
insurance coverage.
insurance exchanges. An insurance exchange will
be an online marketplace where consumers can go
to find out about health insurance plans available
in their area. They will also be able to compare the
costs and benefits of those plans. It will function like
other online marketplaces. More details about these
exchanges are on page 3.
The law required several changes to be put into
place in the first six months after the law was passed.
Other parts of the ACA do not go into effect until
January 1, 2014 or after.
This booklet was designed to help you understand
what the law says, what changes have or will need to
be made, and how it can affect Kansans.
One of the biggest changes to the current health
insurance system will be the creation of health
Changes already in place
On September 23, 2010, nearly all adult children
became eligible to stay on their parents’ health insurance policies until their 26th birthday.
Adult children are eligible for these benefits regardless
of marital status, financial dependency, enrollment in
school or residency.
Insurance companies were required to notify customers of their opportunity to enroll in coverage. Call your
insurance company if you want to access this provision. You may also enroll your child during the next
open enrollment period.
Many preventive services are included in your policy
with no out-of-pocket costs. Out-of-pocket costs
include deductibles, copays and coinsurance. You must
see an in-network doctor for these services. Some of
these services include:
• Colorectal cancer screenings for individuals over
age 50.
• Immunizations and vaccines for adults and
children.
• Counseling to help adults stop smoking.
• Well-woman checkups, as well as mammograms
and cervical cancer screenings.
• Yearly “wellness” exams for Medicare-eligible
Kansans.
Through 2014, people with pre-existing conditions
can get coverage through the Pre-existing Condition Insurance Plan – Kansas (PCIP-KS). In order to
qualify for this coverage you must have been turned
down for insurance coverage in the past, and have
been without health insurance coverage for at least 6
months. The PCIP-KS is a federally-run program and
will provide coverage until January 1, 2014. At that
time everyone will be able to get coverage in the pri-
Changes already in place (cont’d)
vate market, even if they are already sick.
Children age 19 and under can no longer be turned
down for coverage because of a pre-existing condition. This coverage began on September 23, 2010, and
applies to all group and individual health plans.
Health insurance policies cannot put any lifetime
limits on essential health coverage. This coverage
began on September 23, 2010. In the next few years,
annual limits will be gradually increased and will be
eliminated completely on January 1, 2014.
Insurance companies can no longer cancel coverage because of an honest mistake. Coverage can be
canceled because of fraud or intentional misrepresentation. Companies must give a 30-day notice before
rescinding coverage. The consumer can file an appeal
during this time.
Small businesses that provide health care for employees can apply for tax credits. The credits are available
to employers who cover at least 50% of health insurance costs for some or all employees. The employer
must have fewer than 25 full-time employees (or the
equivalent) and pay annual wages of less than $50,000
per person.
Seniors with Medicare prescription drug coverage
were eligible for a rebate to help cover costs. This
rebate helped close the “doughnut hole” gap found in
Part D. This hole will continue to gradually close in the
upcoming years. Additionally, seniors under Medicare
coverage can now receive a number of preventive benefits without cost sharing.
The ACA changes the appeals and external review
processes. Consumers who have had a claim denied
can continue to appeal their insurance company’s
decision. The process for externally reviewing denied
claims was also strengthened by the ACA. These processes include emergency claims.
Incentives are put in place to bring primary care doctors to underserved areas of the state. These incentives
include student loan repayment assistance and new
scholarships. Any doctor, nurse or physician’s assistant
who is willing to work in underserved areas of the state
may receive these incentives.
Changes coming on January 1, 2014 or after
Nearly all individuals will be required to have health
insurance or pay a penalty. Only certain religious
groups or people with very low incomes will be exempt. Financial assistance will be available for people
with limited incomes.
No one will be turned down for health insurance
just because they have a pre-existing condition. You
cannot be charged more for your coverage just because
you are sick, either. Women will no longer be charged
more than men for equal coverage.
Insurance companies must let you enroll in coverage
regardless of gender or health status. However, this
does not guarantee that all people will be charged the
same amount. Insurance companies can decide what
to charge you based on your age, your family size,
whether or not you use tobacco, and where you live.
All health insurance coverage can be renewed as long
as you pay your premiums.
Financial assistance will be available to everyone up
to 400% of the federal poverty level. This assistance
will only be available to people who buy their coverage
through the exchange.
All health plans offered through the exchange will be
required to cover certain basic categories of health
Kansas Insurance Department Consumer Assistance Program
www.ksinsurance.org • 1-800-432-2484
care. These categories include emergency services,
hospitalization, maternity and newborn care, mental
health and substance disorders, prescription drugs,
laboratory services, and pediatric services. More
details about these “essential health benefits” will be
available in the future.
Tax credits for small businesses who provide health
insurance will increase. Small businesses who have
fewer than 25 full-time employees and pay an average
wage of $50,000 or less are eligible for even more of a
tax credit.
Insurance companies cannot drop or limit coverage if
an individual chooses to participate in a clinical trial.
This includes all clinical trials for cancer or other lifethreatening illnesses.
Health insurance exchanges in 2014
An insurance exchange is an online website where people and small businesses can go to buy health insurance.
The website will allow them to compare the benefits and costs of those plans and to enroll in coverage. Consumers may also be eligible to receive tax credits and/or subsidies to help pay for their coverage. There are several
features of these exchanges:
Essential health benefit coverage: Health plans sold through the exchange will be required to meet minimum
standards for coverage, including ambulance services, hospital coverage, maternity and newborn coverage, mental health coverage, laboratory services, prescription drugs, and pediatric services, to name a few.
Tiers of coverage: Four tiers of coverage will be available through the exchange:
Bronze:
Silver:
Gold:
Platinum:
Insurance covers 60% of covered expenses
Insurance covers 70% of covered expenses
Insurance covers 80% of covered expenses
Insurance covers 90% of covered expenses
Small businesses will be able to use these tiers to offer coverage to their employees. Employers will have the option of choosing the tier level of coverage and employees may then be able to select a plan within that level. All
plans within the same tier will have the same level of coverage, but prices of plans will vary from company to
company.
A catastrophic plan will also be available for purchase through the exchange. It will only be available to individuals under the age of 30 and those exempt from the requirement to purchase insurance.
Financial assistance: The exchange will look at your financial information to help determine if you qualify for
federal subsidies or tax credits. Even if you are unsure of what you are eligible for, the exchange can help you find
coverage you can afford. Taking this financial assistance is optional. No one will be forced to accept it.
“No wrong door” policy: The exchange will also help anyone who is eligible for Medicaid services find coverage.
Kansas Insurance Department Consumer Assistance Program
www.ksinsurance.org • 1-800-432-2484
STATE VS. FEDERAL CONTROL OVER THE EXCHANGE
The ACA says that there must be a health insurance exchange ready to function in every state by January 1, 2014.
Like all other states, Kansas was given the option of running its own exchange or allowing the federal government to run the exchange. States could also choose to partner with the federal government and run a “partnership” exchange. The following graph visually demonstrates where each of these options lie on a spectrum of state
and federal control:
INSURANCE EXCHANGE OPTIONS
State control
State-based exchange
Federal control
Partnership exchange
Federally-facilitated
exchange
Because of time constraints, Kansas can no longer implement a state exchange by January 1, 2014 (though a
state exchange can be put into place at any time in the future). This means that Kansas will either partner with
the federal government to create an exchange or let the federal government create it without state input.
IF KANSAS HAS A PARTNERSHIP EXCHANGE
In a partnership exchange, the state would control some parts of the exchange and the federal government would
control the rest. The state and federal governments would work together to create an exchange best suited for
Kansans. The following graph outlines which branch of government would control which parts of a partnership
exchange:
KANSAS CONTROL
FEDERAL GOVERNMENT CONTROL
• Consumer Assistance, including educating
Kansans and operating an in-person assistance
program to help people compare insurance options
and enroll in coverage.
• Eligibility, including deciding who is eligible for
private insurance and who is eligible for Medicaid
coverage and enrolling them into that coverage.
• Plan Management, including authorizing which
insurance plans will be offered to Kansans in the
exchange and handling consumer complaints
about those plans.
• Enrollment, which includes enrolling consumers
into health plans and gathering and transmitting
that information to insurance companies.
• Financial Management, which includes collecting fees from consumers and maintaining the
financial integrity of the exchange.
In a federally controlled exchange, the federal government would control all aspects of the exchange.
The Kansas Insurance Department will remain in place regardless of who controls the exchange. We will continue to work for Kansans, regulating the insurance industry in Kansas and providing the same consumer assistance
that we offer now. Any questions about this booklet or health reform in general can be directed to our department by calling our Consumer Assistance Division at 800-432-2484.
Kansas Insurance Department Consumer Assistance Program
www.ksinsurance.org • 1-800-432-2484