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Wednesday, September 25,2013

The Exchange

Your guide to navigating uncharted health insurance waters

by Walt Sorg
Twenty-seven-year-old Alison has been rolling the dice for years.

She works full time at a local print shop, but her $10 an hour pay falls far short of what’s needed to buy health insurance.

She knows the risk. As a teenager, a horse-riding accident ended with several broken bones, a leg held together with surgical screws, and major medical bills. Back then, her bills were covered by her parents’ insurance but, for the last five years, she’s been on her own medically, gambling daily that another emergency doesn’t bankrupt her.

Shawn Dhanak is diabetic. When he turned 26, he lost coverage from his parents’ health insurance.

“I could not find a health care plan that I could afford,” he said. “I had to settle for a catastrophic plan that didn’t come anywhere close to covering what I needed.”

Under the Affordable Care Act, Dhanak would have been able to buy comprehensive coverage within his budget. And with the requirement that requires coverage for preexisting conditions, his diabetes is covered immediately.

Dhanak works for Enroll America, a national nonprofit organization working to bring information to Michigan’s roughly 1.2 million uninsured residents about their new options — and about being able to protect themselves from the anxiety he himself experienced.

Beginning Tuesday, limitations on affordable access to health care begin to crumble for Alison, Dhanak and millions of Americans.

On Tuesday, the Healthcare Insurance Marketplace goes online, allowing many uninsured Michigan citizens to shop for comprehensive coverage. They will be able to choose between more than four dozen plans offered through 13 private insurers. Coverage becomes effective Jan. 1. As a result of federal tax credits, low-wage workers will pay as little as $19 a month for coverage.

The Healthcare Insurance Marketplace, also called the “Exchange,” is a critical linchpin of what’s commonly called “Obamacare.”

It only works if people enroll. Polling shows many of those eligible don’t know about the their rights under the Affordable Care Act.

Some opponents of the law are even actively discouraging people from enrolling despite the law’s requirement that virtually everyone have health care coverage.

Dhanak said his organization is “laser focused” on cutting through the political noise, and having “just-the-facts conversations.”

“We know this is going to be a conversation, not a stampede starting Oct. 1,” he said.

“We are in a campaign to reach as many of the 1.2 million uninsured in Michigan as possible. There is no definite end date like in a normal campaign. We’ll keep going until we think we’ve reached our goal of maximizing participation in health care coverage.”

Much of the responsibility for enrolling the bulk of those uninsured falls to Michigan Consumers for Healthcare. The organization is in charge of training and certifying the hundreds of people who will help consumers navigate the expanded world of health care coverage.

Brett Williams, the central Michigan coordinator of Michigan Consumers for Healthcare, appears daily before consumer and business groups. After more than three years of often heated political debate, he concurred that there is a lot of confusion and misinformation.

“After people know what is actually in the law, they come up to me and say, ‘That’s not what I was told by anyone. I can’t believe it’s this simple,’” Williams said. “I’ve been invited to some of the most politically conservative areas in this state three, four, five times. Once they learn what’s actually in the law and take off the blinders, the say, “Wow, this makes sense.”

Who is directly impacted?

For the vast majority of Michigan citizens — those with employer-provided coverage and seniors covered by Medicare — the rollout of the exchange will have little or no direct impact on their lives.

“If there are changes, they may be an enriched level of benefits because of the essential health benefits that all plans are required to have,” Williams said.

Seniors enrolled in Medicare have already experienced the biggest impact of the Affordable Care Act. The “donut hole” for prescription-drug costs has been closed and all health care plans are now required to provide preventative services such as checkups with no copay.

Beginning in January, the uninsured and those who buy their own insurance — which includes those 26 and older who no longer are covered under their parents’ insurance — will be the big winners with the rollout of the exchange. Anyone earning between 100 percent and 400 percent of the Federal Poverty Level (see graphic on poverty guidelines) will be eligible for premium tax credits. The credits cap premiums at 2 percent of income for those at 100 percent of the Federal Poverty Level, and ratchet up to no more than 9.5 percent for those at 400 percent of the poverty level. Those earning below 250 percent of the poverty level will also see a cap on their out-of-pocket expenses.

“The Exchange”

The state Legislature turned down federal funds to establish a state operated insurance marketplace and also rejected Gov. Rick Snyder’s proposal for a joint state-federal exchange. As a result, Michigan consumers will purchase insurance through the federal marketplace.

The marketplace will not require individuals to give up or exchange their coverage for something new or different, but instead it provides the opportunity for those without employer-funded coverage to shop, compare and purchase private health insurance coverage.

The marketplace is open only to individuals who do not have access to insurance through their employer or through other government programs such as Medicare or Medicaid. Also barred from the exchange are people who are incarcerated, undocumented immigrants, documented immigrants who have been in the country less than five years and people earning less than 100 percent of the Federal Poverty Level. (See “Medicaid Expansion” box, this page.)

Primary access to the exchange will be online through healthcare.gov. The site, which is compared to online travel sites such as Travelocity and Orbitz, will show consumers what is available. (The Michigan League for Public Policy notes that the comparison may be an over-simplification: “Selecting healthcare coverage that meets one’s needs is far more complicated than selecting an airline to fly from point A to point B.”) The law requires plain-English explanations of benefits and sets minimum levels of coverage within the four categories.

The site will allow shoppers to calculate their net premium, or what they will actually pay after federal tax credits. Credits will be paid directly to insurers — customers will only have to pay the net amount every month.

Consumers will be able to get assistance from a statewide network of “navigators” and “Certified Application Counselors,” organizations and individuals who have been trained in the complexities of the system. In Ingham County, the primary navigators and counselors will be from the county Health Department. (Think of it as being comparable to getting expert help from a travel agent rather than just relying on Travelocity to plan your trip.)

There is also a toll-free assistance line to answer specific questions (800-318-2596).

Local safety net programs to continue

For years, Ingham County has taken the lead in helping the uninsured through the Ingham Health Plan.

Although not considered an insurance product, the plan has provided tens of thousands of people with access to primary care and reduced-cost prescriptions.

While 80 percent of Ingham Health Plan’s 12,000 members will qualify for Medicaid, hundreds of county residents will remain uninsured. They include U.S. citizens who have been in the country legally for less than five years, undocumented immigrants and a small number who will opt out of health care for religious or other reasons.

Robin Reynolds, the plan’s executive director, said the health plan will continue operations for now to make sure those individuals still have access to assistance, but its mission could be fundamentally altered by the Affordable Care Act.

“If everybody’s covered at some point, we could go out of business, and that’s the ultimate goal,” she said.

One immediate change in mission will be to help people move into either the exchange or Medicaid, depending on their financial status. The Ingham County Health Department is the area’s primary navigator and will provide assistance in enrolling at sites across the county. Reynolds expects challenges in doing so, but is confident the challenges can be met.

“There will be bumps in the road, but we can do this,” she said.

Nonprofit health care centers will continue to operate as well. In Ingham County, Care Free Medical and Dental and Cristo Rey Family Health Clinic combine to serve more than 12,000 patients annually.

Michelle Lantz, vice president of Care Free Medical, said her organization will continue to be the health care gateway for patients who have difficulty finding providers.

Over the long term, Lantz is hopeful that expanded access to health care reduces demands on the entire system as more people practice preventative care.

“That’s the 10-year goal, but it’s not going to happen in two to three years because the population we see now hasn’t had preventative care up to this point in their lives,” Lantz said. “If we get them into preventative care and keep them there, then eventually the whole population will be less ill.”

More patients for a crowded system

One of the major concerns is whether Michigan’s health care system can handle the influx of 500,000 or more newly insured patients.

Laura Appel, vice president of federal policy and advocacy at the Michigan Health and Hospital Association, is optimistic.

“There’s 10 million people in Michigan,” Appel said. “Hospitals are open 24/7/365 to take care of them now. We expect that on Jan. 1 we’ll keep taking care of them. We do it everyday. We’re going to keep doing it. The primary care doctors tell us they’re ready, the health care centers say they’re ready.”

Michigan hospitals, which absorbed an estimated $882 million in uncompensated patient care in 2011, are focused on getting as many eligible patients enrolled through the exchange or Medicaid as possible. Most will have staff trained as Certified Application Counselors to assist eligible patients.

The Henry Ford Health System in Detroit estimates that Obamacare will reduce uncompensated care by about 15 percent, a savings that impacts both insurance premiums and federal subsidies to hospitals. (A large percentage of uncompensated care is the result of catastrophic cases involving people with high deductibles and co-pays. People ineligible for either Medicaid or the exchange will continue to receive emergency care if they are unable to pay.)

Appel is more concerned about the initial rollout of expanded health care. The delay in Medicaid expansion, she noted, will create some confusion and discouragement. And any glitches could have long-term implications for the effectiveness of healthcare expansion.

“We’ve got to engage folks. You can’t make people get coverage. It’s got to be a positive and relatively easy experience for them,” she said.

She, and thousands of others directly involved in implementing expanded healthcare coverage, are doing all they can to make that goal a reality.

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