Health

Saturday, Sep 14 2013 10:00 PM

Applying for health insurance? Homework involved

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    By AP Photo/J. David Ake

    This April 30, 2013 file photo shows the short form for the new federal Affordable Care Act application in Washington. Getting covered through President Barack Obama's health care law might feel like a combination of doing your taxes and making a big purchase that requires some research. You'll need accurate income information for your household, plus some understanding of how health insurance works, so you can get the financial assistance you qualify for and pick a health plan that's right for your needs.

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BY RICARDO ALONSO-ZALDIVAR Associated Press

WASHINGTON -- Getting covered through President Barack Obama's health care law might feel like a combination of doing your taxes and making a big purchase that requires research.

You'll need accurate income information for your household, plus some understanding of how health insurance works, so you can get the financial assistance you qualify for and pick a health plan that's right for your needs.

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ESSENTIAL HEALTH BENEFITS

Under the law, health insurers must cover 10 essential benefits. This will make health plans more costly, but also more comprehensive.

Starting next year, the rules will apply to all plans offered to individuals or through the small-group market to employers with 50 or fewer workers. The essential-benefits requirement does not apply to plans offered by larger employers, which typically offer most of these, already.

The covered benefits are: ambulatory patient services; emergency services; hospitalization; maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative services and devices; laboratory services; management of chronic diseases, and preventive and wellness services; and pediatric services, including dental and vision care.

People will be able to pick from insurance plans with differing levels of coverage and varying costs for co-pays and premiums. But insurers will have to cover a certain percentage of the services' cost.

"Most of the important services people need are covered, though there may be a slight variation (from state to state)," says Jennifer Tolbert, director of state health reform for the Kaiser Family Foundation.

DENTAL-VISION

Need a teeth-cleaning or eye exam? You still could be reaching into your own wallet to cover the cost even after the Affordable Care Act takes full effect next year. Dental and vision care is considered an essential benefit for children aged 18 and younger whose parents or guardians get insurance through the individual or small-group plans. The law does not mandate this coverage for adults, but some states could choose to have them covered.

Still, getting dental coverage for children and teenagers might be a bit complicated depending on where you live. States can choose to offer those items as stand-alone plans, and federal subsidies would not help pay for the costs.

PRE-EXISTING CONDITIONS

This is a major change under the law. Starting in 2014, most plans -- whether obtained through an employer or on the marketplace -- cannot deny coverage or charge more money because of a pre-existing health conditions.

However, if you have what is known as a grandfathered individual plan -- a plan you buy yourself that was in existence before March 23, 2010, and has remained unchanged -- then this rule would not apply. So check the details on your plan and consider shopping around.

OUT-OF-POCKET SPENDING/LIFETIME LIMITS

Under the law, the amount of money people will have to pay out-of-pocket each year for medical and prescription drug costs will be capped at $6,350 for individuals and $12,700 for a family. These limits are separate from the monthly premiums people pay. The limits take effect in 2014 for those buying insurance on the state health insurance exchanges. For those with employer-based coverage, the restrictions will be fully in place in 2015.

In addition, most insurance plans will be prohibited from setting lifetime cost limits on coverage for essential health benefits. This means your insurer cannot deny you coverage because your medical bills have gone over a certain amount.

AGE 26

One popular provision of the health care law already is part of most insurance plans -- allowing young people to stay on their parents' insurance plans until age 26. This also covers dependents, including step-children, adopted children and some foster children. This benefit will be required of all plans that provide dependent care. Starting in 2014, younger people can remain on a parent's or caregiver's plan even if they have an employer option of their own.

-- The Associated Press

The process involves federal agencies verifying your identity, citizenship and income, and you have to sign that you are providing truthful information, subject to perjury laws.

You heard it was going to be like buying airline tickets online? Not quite. But even if the process triggers some anxiety, it's not the government poking in your medical records, as "Obamacare" foes have suggested.

After state health insurance markets open Oct. 1, consumers can apply online, via a call center, in person or by mail. Trained helpers are supposed to be available, but there may not be enough of them.

The main steps are:

-- Identify yourself and your family members.

-- Provide current information on income, jobs and any available health insurance options.

-- Learn how much financial assistance you're entitled to.

-- Shop for a health plan and enroll.

Many people, ranging from lower-income workers to the solid middle class, will qualify for tax credits to help buy a private plan through the state markets. The government will send money directly to your insurer, and you'll make arrangements to pay any remaining premium.

The poor and near-poor will be steered to Medicaid in states that agree to expand that program.

Here's an overview of what to expect applying online, with tips:

Go to healthcare.gov and click on "Get Insurance." The site has links to every state market. You'll set up an account and password. You'll provide your contact information and the best way to reach you.

Tip -- Treat your password like a bank account or credit card password. It's not a good idea to set it as "1234567."

Now you can tackle the actual application. You'll need birth dates and Social Security numbers for yourself and other family members listed on your federal tax return.

You'll also be asked if you're a citizen. Legal immigrants will need their immigration documents.

Tip -- You don't have to plow through the entire application in one sitting. You can save your work and come back later.

Next, you'll be asked about income.

You may need your most recent tax return, pay stubs and details on other kinds of income, such as alimony, pensions and rents. You can still apply if you haven't filed a tax return. You'll also be asked about access to health insurance through your job. You may be required to take that insurance if available.

Your personal and income details will be routed through a new government entity called the data services hub, which will ping agencies like Social Security, Homeland Security and the Internal Revenue Service for verification. The feds will also rely on a major private credit reporting company to verify income and employment.

How smoothly all this works is one of the big unknowns. It could get tedious if discrepancies take time to resolve.

Tip -- Provide the most accurate estimate of your expected income for 2014. Lowball the number, and you might see a smaller tax refund in 2015. Overestimate and you won't get as big a tax credit now.

If you're like most people, you'll be getting a tax credit to help pay your premiums. The credits are based on your income and keyed to the premium for a benchmark plan known as the "second-lowest cost silver plan" in your area.

With your tax credit, you can finally shop for insurance. Beware: you'll probably have to live with your decision until the next annual enrollment period.

You'll have up to four levels of coverage to consider: bronze, silver, gold and platinum. Plans at every "metal level" cover the same benefits and have a cap of $6,350 a year in out-of-pocket expenses for an individual, $12,700 for families.

Bronze plans generally have the lowest premiums, but cover only 60 percent of medical costs on average. Policyholders will pay the difference, up to the annual out of pocket cap. Platinum plans have the highest premiums, but cover 90 percent of costs. Young adults up to age 30 can pick a skinny "catastrophic" plan -- but you can't use your tax credit on a catastrophic plan.

Tip -- Make sure your doctors and hospitals are in the plan you pick. You may have to check the plan's own website, or call your doctor.

Tip -- Your share of the premium could be lower -- even zero -- if you apply your tax credit to a bronze plan. It's because the credit is keyed to the cost of a silver plan, which is generally more expensive.

Tip -- Check if you are eligible for "cost-sharing subsidies," in addition to your tax credit. Extra help with out-of-pocket costs is available to people with modest incomes. But only with a silver plan.

Head spinning?

Richard Onizuka, director of the Washington state market, says picking a plan could be the most difficult step. Most of his customers were previously uninsured, so insurance jargon could seem like a foreign language.

"The biggest challenge for consumers will be understanding health insurance and how to purchase it," he said.

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