Compare Health Exchange And Marketplace Options In Pennsylvania

In October of 2013, the Pennsylvania Health Insurance Exchange became operational. No...wait. The federal government is now calling them "Marketplaces," and not "Exchanges." Is there a difference? Does it really matter? The answer is no! Coverage is guaranteed and you don't have to answer medical questions regardless what you call it.

"Exchange" Or "Marketplace"

For years, we have been watching the Exchange idea start from an idea, to proposed legislation, to a passed bill (that wasn't studied by very many people), to a working project, to what it is now. And that is...a near-finished project that offers insurance to individuals, families, the self-employed and business owners. Notice, that I did NOT include the word "affordable" in that description, since without the subsidy, prices can be quite high.

Here in Pennsylvania, you can easily view rates, compare plans, and enroll on this website. Pahealthinsurancecoverage.com is one of the premier reputable websites for Keystone state residents and all information is updated on a regular basis. Individual and family options are displayed. But back to our story!

But a funny thing happened in 2013. Unexpectedly and without warning, healthcare.gov started to eliminate references to Exchanges and began to insert the term  "Marketplace" in instead. Of course, this is not a devious act and probably wasn't spotted by folks that aren't in this field. But clearly, there was a shift.

2014 Trends

In 2014, this curious trend continued, including many 2015 references to the "Marketplace." Even many states (other than Pa.) that control their own delivery system, have gotten into the act with the subtle name change. For 2015, many companies have requested rate increases that are waiting to be approved by the State Insurance Department. These changes could result (depending on the carrier) in 5%-20% increases.

Here Come The Exchanges (Marketplaces?)

Why did this occur? Probably because the second term gives the impression that you are buying Pennsylvania health insurance plans (or any state) in a competitive environment where you shop for bargains, find quite a few, and then pick your favorite. The first term just didn't seem to resonate with consumers. It almost sounded as if you were exchanging  one product you were not happy with, for another product you were unsure about.

OK...So now they are called Marketplaces. What exactly are they and how does the process of buying health insurance change? You still should use experienced brokers and preferably reputable websites that update content and explain current topics such as different "Medal" plans and the federal tax subsidy. But whether you call it an "Exchange" or "Marketplace," one thing doesn't change. And that is you no longer have to answer medical questions when applying for coverage.

No More Underwriting

"Guarantee Issue" is now the name of the game. It started in 2014 and refers to the fact that you don't have to worry about an underwriter approving your application. If you're a US citizen, legally reside here in the Keystone state, aren't incarcerated, and aren't eligible for Medicaid or Medicare, you're probably going to be approved.

No long applications...Oh...wait. They still are long since your federal tax subsidy has to be calculated. Rates? If you qualify for the subsidy, you're in pretty good shape. If you are unfortunate enough to make more than $95,000 (Total household income for four persons) or close to that amount, you may not be very pleased with the "Affordable" Care Act, since it doesn't seem to make new plans very affordable.

Although "navigators" have become available to help consumers, they tend to be inexperienced compared to licensed brokers that have been writing business for decades. Since there are tax subsidy and suitability issues, along with determining if in or out of the Exchange is appropriate, utilizing respected websites and broker/agents will be critical.

Brokers Save Consumers Money

"Navigators"  play a role in reaching consumers that do not have access to the internet or simply choose to attempt to work through an intricate process without the best available help. And yes, there will be plenty of consumers that take that route. But unless you do not have access to agents (either online or in your area), there is no need for utilizing a navigator.

So...Exchanges. Marketplaces. Does it really make a difference what we call it? Not really. But it does make a difference who helps you and which website you visit to learn about your options.

Small Business Owners Choosing To Drop Employee Healthcare

Many small business owners are choosing to drop their healthcare plans. It's not that they are being mean or hateful. They are simply trying to survive, and ironically, protect the jobs of their employees. The Affordable Care Act legislation has not been kind to most employers, and survival is, as you might expect, the top priority.

In 2014 when much of the new healthcare began, a business that had 50 or more full-time employees, was forced to purchase health insurance for workers that average 30 hours (weekly) in a specific month. And that is expensive. However, the alternative is rather attractive. A mere $2,000 tax for any full-time employee in the company (exceeding 30).

Since many business owners spend twice or three times that amount on healthcare benefits, it is tempting to drop the group medical plan and pay the fine. With the extra money (and there could be quite a bit), more funds are spent on research, development and upgrading equipment, which potentially would make the price of their products more competitive.

Also, since these changes would result in increased sales, the security of the employee's job position would be enhanced, and perhaps wages would also increase. Of course, the worker would not have to purchase their health insurance through their state Exchange or Marketplace, which would require the help of an experienced broker.

A company that employs 250 people is likely to save between $350,000 and $750,000 in insurance premiums each year by allowing workers to purchase their policies on an Exchange. It costs (on average) about $15,000 per family to cover medical benefits. That saved money may provide more employment possibilities for the company, and ultimately helps the local community. A bit like a vicious circle, but just the opposite!

And if the family that is losing benefits qualifies for the federal subsidy, it is likely their cost will be very affordable, and the coverage will include maternity and most (or all) benefits that were enjoyed on the group plan. Since Open Enrollment occurs every year, a worker that is not provided group benefits can apply for a new plan, or keep their existing benefits on an annual basis.

Many of these mandatory requirements for business owners have been put off...for now. First extended to 2015 (and now extended to 2016), the Administration seems to comprehend that the new legislation forcing businesses to buy expensive healthcare must be tweaked or changed. And so far, that's exactly what is happening.

The Department Of Health And Human Services predicts that most employers will not drop their healthcare plans and pay the fine. By the beginning of 2016, we'll find out. I suspect more employers will indeed terminate group plans simply to stay competitive with other US, European and Asian competition. However, if problems begin to surface with hiring the best workers (because of lack of healthcare), the percentage of businesses that retain benefits will be higher.