What is Health Care Reform?
On March 23, 2010, President Obama signed the Affordable Care Act (ACA) also known as health care reform into law. The law puts in place a significant number of health insurance reforms that have rolled out over the last three years. Some of the final and most notable changes of the law will take effect on January 1, 2014.
The best way to summarize the impact of the ACA is to say that it will make insurance more accessible to you. There are a number of provisions throughout the law that help you afford coverage, as well as guarantee you access to insurance with a minimum level of benefits.
Primary among these reforms is assistance for individuals and families to purchase health insurance through federal subsidies and expanded eligibility for Medicaid; as well guaranteed access to health insurance regardless of your age or health status.
Starting January 1, 2014, you will no longer be declined coverage or charged extra for health insurance because of a health issue you have now or in the past. You will also be guaranteed a minimum set of health benefits known as “Essential Health Benefits"
Other noteable market reforms include:
- Extending dependent coverage to age 26.
- Coverage with no expense to the consumer of most preventive services and immunizations.
- Insurers in the individual and small group market but spend at least 80 cents of every dollar collected from consumers on medical care and services.
- Annual and lifetime dollar limits are prohibited on essential health benefits.
Help Affording Health Insurance
For an individual, 400% of federal poverty level is $45,960
For a family of 4, 400% of federal poverty level is $94,200
Premium assistance can be estimated by using the premium cost calculator at NevadaHealthLink.com.
It’s also important to know that beginning in 2014, most people will have to have health insurance or pay a fine. For individuals, the penalty for the entire year will be $95 per adult and $47.50 per child, up to a family maximum of $285 or 1 percent of the family’s income, whichever is greater.
In 2015, these amounts increase to $325 per adult, $162.50 per child, and a family maximum of $975 or 2 percent of the family’s income.
For 2016 and subsequent years, the full penalties will be $695 per adult, $347.50 per child, and a family maximum of $2,085 or 2.5 percent of the family’s income.
The requirement to have coverage can be waived for several reasons, including financial hardship or religious beliefs.
The IRS intends to send letters to taxpayers notifying them that they owe the penalty, and it will also have the power to withhold future tax refunds.
Health Insurance Rates
One result of the ACA is that Nevada expanded its review of health insurance rates. Nevada continues to review all health insurance rate changes in the individual and small group insurance markets, however now that review can includes additional staffing, greater reliance on technology and outside actuarial consulting analysis of submitted data.
The law also requires insurance companies to spend the majority of your premium dollars on health care. This means that insurers selling policies to individuals or small groups must spend at least 80% of premiums on direct medical care and efforts to improve the quality of care or provide a premium rebate to their customers.
A similar requirement applies to large group health insurance; insurers selling to large groups (usually 50 or more employees) must spend 85% of premiums on care and quality improvement.
The Nevada Division of Insurance is committed to consumer protection and transparency in regards to the cost of your health insurance, read more about health insurance rates in Nevada here.