Like it or not, New York’s new health insurance marketplace is ready to open for business Tuesday.
The program, dubbed the New York State of Health, is the state’s version of the health exchange mandated by the Patient Protection and Affordable Health Act, known to many as Obamacare. The goal of the controversial legislation is to ensure that everyone in the nation is covered by health insurance by offering an array of choices from exchanges opening in each state.
Beginning Tuesday, consumers will be able to calculate costs and enroll in coverage online, in person, over the telephone or by mail.
According to U.S. Census data, about one in every six New Yorkers younger than 65 lacks health coverage. The New York State of Health will offer a menu of plans to them, as well as to people who buy their own coverage, and those who want to switch from an employer’s insurance plan.
In New York, the operative words being used to promote the tiered levels of coverage being offered by the state exchange are their “low cost.” The adjective is used in the opening slide of the program’s website. In case you miss it, “low cost” is mentioned again in the brief blurbs that go with both the second slide and the final third slide.
Whether the plans will actually be affordable to consumers with modest incomes is a matter of concern to several people interviewed by The Daily Star, including some who have resisted getting health insurance but have no choice now but to obtain it.
What is certain is that some plans will be more expensive than others. The insurers participating in the exchange will offer four tiers of coverage. The ones with the lowest monthly premiums will have the highest out-of-pocket costs when medical services or prescription medications are obtained. The tiers will be known as bronze, silver, gold and platinum, with the cost being based on deductibles, co-payments and the costs to the consumer.
All plans will cover emergency care, hospitalization, prescription drug coverage, mental health care and maternity and pediatric care. They also must provide preventive care such as routine vaccinations, mammograms and flu shots at no cost to the consumer.
One of the most significant aspects of the health exchanges being set up across the country is that, starting in 2014, having a pre-existing condition or being sick won’t keep people from getting health coverage. Insurers can’t jack up premiums or reject applications for coverage because of the applicant’s health condition. This applies even when the applicant has been rejected for coverage in the past.
Analysts who have been reviewing the premiums say that, in general, buyers who are younger and healthier will have to spend more for coverage than they do now. But coverage will be more affordable for people who are older and sicker.
In order to be covered by a plan by Jan. 1, consumers must enroll in a plan of their choice by Dec. 15.
Those who continue to stay uninsured after Jan. 1 face potential penalties of $95 or 1 percent of their income, whichever is greater amount. The fines will progressively accelerate each following year, rising to $695, or 2.5 percent of total income, by 2016.
Rebecca Lloyd, the vice president of Oneonta Block Co., said her company has been gearing up for months for the introduction of the Affordable Care Act, to ensure it complies with all requirements and to help company officials deal with the questions they expect to get from the firm’s 48 employees.
Lloyd said the company will continue to offer health coverage to its workers, though it will be up to those employees as to whether they want to go shopping on the New York State of Health exchange before deciding if they want to stick with the company’s coverage.
“Every individual out there is going to have to do a lot of work to be able to understand the different options being offered to them and what it is going to cost them,” Lloyd said.
She said all businesses have had to become steeped in the requirements associated with the Affordable Care Act, and that has taken time away from other activities, such as marketing products, meeting with customers and doing the things businesses do to remain profitable in order to continue to provide jobs.
Lloyd said it remains to be seen whether the insurance premiums offered by the exchange will cost less or more than the health coverage that workers can get now from employers who offer it.
“We have no idea because the exchange hasn’t opened yet,” she said.
Those eligible for subsidies available for lower income consumers could end up paying significantly less than others for the same tier of health care benefits than those with higher incomes. Lloyd said if the consumer’s employer offers coverage now, the subsidy will not be offered unless the cost of the insurance exceeds 9.5 percent of the consumer’s total income. Employers won’t be able to help their workers figure out if they are eligible for the subsidies because the employers do not know whether their workers are generating income from other sources, she pointed out.
The Affordable Care Act also requires large employers, defined as those with more than 50 workers, to offer health care plans. However, the enforcement of that part of the program has been postponed by the Obama administration until Jan. 1, 2015. Only six percent of large employers offer no health insurance, according to the Henry J. Kaiser Family Foundation.
On the other end of the workplace spectrum are such small family-run businesses as HaSu Ranch in East Meredith, where Hazen Reed and his wife, Susan Muther, raise alpacas.
Reed said he is going to examine the offerings from the New York State of Health exchange because the state, as of Jan. 1, is discontinuing much of the Healthy NY program that he has relied on in recent years.
“I believe offering coverage is something we should be doing as a business,” Reed said. “I can’t be critical of businesses that don’t offer it but I just believe that offering it is something we should be doing here.”
Reed said he looks forward to seeing what the new York exchange has to offer.
“I’m not versed in the exchange at the moment, but it is something I am definitely going to be looking into,” he said. “I just don’t think you can afford to be without insurance. There are just too many catastrophic things that can happen. Staying on top of everything can be a challenge. But I have a family. I can’t take that risk.”
State officials said the Healthy NY program will be phased out Jan. 1 for individuals and sole proprietors. The program will be limited to small employers only. Those who have relied on Healthy NY are being encouraged by state officials to consider the plans from the exchange.
Among the estimated 50 million Americans who lack health insurance are Holley White and her husband, Richard Giles, who together operate Lucky Dog Farm in Hamden. White said the last time she has had coverage was about a decade ago when she worked for a small publishing company in New York City.
“It’s hard for small business people to be able to afford health insurance, but we’re going to sign up for it now,” White said. “We’ve generally been healthy, and when we’ve had problems we’ve been able to deal with it. But this is going to be something we’re going to be looking at, for sure.”
Health care experts are predicting that with many more people enrolled in health coverage plans, the demand for medical services is bound to increase with the advent of the Affordable Care Act. Some experts also say there will be more jobs for lab technicians, nurse practicioners, medical billing clerks and those skilled in digitizing patient records.
One of the region’s biggest employers now is also a major player in the health care industry, Bassett Healthcare Network. Bassett spokeswoman Karen Huxtable-Hooker said whether the demand of health care services will increase as a result of the introduction of the exchanges won’t be known immediately.
But she said Bassett expanded its primary care programs in anticipation that the exchange would lead to uninsured people getting coverage, a development that Bassett supports.
Huxtable-Hooker noted that Bassett has expanded primary care access in Delaware County, with the opening of the health center in Andes and expanding the primary care health center on the O’Connor Hospital campus. She said Bassett is also moving ahead with its relocation of an expanded primary care health center in Cobleskill.
Meanwhile, Bassett is expanding its primary care center in Little Falls.
State Department of Health officials estimate that 1.1 million New Yorkers will sign up for insurance through the new marketplace.
The premium costs for even the highest level plans, they say, will come to less than half of what consumers paid when they purchased insurance on their own. The costs will be even less for those with limited income, thanks to federal tax credits that are awarded up front to defray the cost of co-pays and deductibles.
To be eligible for the credits, individuals and families must have incomes that are below 400 percent of the federal poverty level: $45,960 for individuals and $94,200 for a family of four.
The tax credits will be greatest for those with the least income.
For the mid-range silver plan, for example, an individual with annual income of $17,000 would pay only $55 per month for coverage, according to the Health Department.
State officials suggest those covered by Medicare may not need the new exchange, although they are still eligible to enroll in a plan offered by the marketplace. However, they will be ineligible for the tax credits and Medicare would be their main coverage, according to state officials.
There are incentives for small businesses to participate in the exchange. The state says businesses with up to 25 employees paying an average annual wage of less than $50,000 and providing health insurance may qualify for the Small Business Health Care Tax Credit. That can amount to up to 50 percent of their share of their employee premiums, and up to 35 percent for nonprofits.
Applying to the marketplace for one of the plans takes about 45 minutes online, officials said, while applying over the phone takes from 45 minutes to an hour. Among information consumers must provide while applying is their income total, the number of people in their household, their address and phone number and whether they have other insurance.
The open enrollment that will begin Tuesday will run through March 31 for individuals and families. In general, those who do not apply by March 31 will have to wait until January 2015 to buy coverage from the exchange.
The web site for New York State of Health can be found at: http://www.nystateofhealth.ny.gov/
The toll-free telephone number for contacting the exchange’s customer service department is (855) 355-5777.