Affordable Care Act Implementation Problems: Health Insurance Marketplace (2013)
The Affordable Care Act (ACA) or Obamacare, includes numerous provisions that took effect between 2010 and 2020. Policies issued before 2010 are exempted by a grandfather clause from many of the changes to insurance standards, but they were affected by other provisions. Significant reforms, most of which took effect on January 1, 2014, include:
Guaranteed issue prohibits insurers from denying coverage to individuals due to pre-existing conditions, and a partial community rating requires insurers to offer the same premium price to all applicants of the same age and geographical location without regard to gender or most pre-existing conditions (excluding tobacco use).
Minimum standards for health insurance policies are established.
An individual mandate requires all individuals not covered by an employer sponsored health plan, Medicaid, Medicare or other public insurance programs (such as Tricare) to secure an approved private-insurance policy or pay a penalty, unless the applicable individual has a financial hardship or is a member of a recognized religious sect exempted by the Internal Revenue Service. The law includes subsidies to help people with low incomes comply with the mandate.
Health insurance exchanges operate as a new avenue by which individuals and small businesses in every state can compare policies and buy insurance (with a government subsidy if eligible). In the first year of operation, open enrollment on the exchanges ran from October 1, 2013 to March 31, 2014. The original purchase deadline date to be covered for January 1, 2014 was December 15, 2013, but the deadline was pushed back, first to December 23, 2013 and later to December 24, 2013. For plans starting in 2015, the proposed enrollment period is November 15, 2014 – February 15, 2015.
Low-income individuals and families whose incomes are between 100% and 400% of the federal poverty level will receive federal subsidies on a sliding scale if they purchase insurance via an exchange. Those from 133% to 150% of the poverty level will be subsidized such that their premium costs will be 3% to 4% of income. In 2013, the subsidy would apply for incomes up to ,960 for an individual or ,200 for a family of four; consumers can choose to receive their tax credits in advance, and the exchange will send the money directly to the insurer every month. Small businesses will be eligible for subsidies.
Medicaid eligibility expanded to include individuals and families with incomes up to 133% of the federal poverty level, including adults without disabilities and without dependent children. The law also provides for a 5% “income disregard”, making the effective income eligibility limit for Medicaid 138% of the poverty level. Furthermore, the State Children’s Health Insurance Program (CHIP) enrollment process is simplified. However, in National Federation of Independent Business v. Sebelius, the Supreme Court ruled that states may opt out of the Medicaid expansion, and several have done so.
Reforms to the Medicare payment system are meant to promote greater efficiency in the healthcare delivery system by restructuring Medicare reimbursements from fee-for-service to bundled payments. Under the new payment system, a single payment is paid to a hospital and a physician group for a defined episode of care (such as a hip replacement) rather than individual payments to individual service providers. In addition, the Medicare Part D coverage gap (commonly called the “donut hole”) will shrink incrementally, closing completely by January 1, 2020.
Businesses which employ 50 or more people but do not offer health insurance to their full-time employees will pay a tax penalty if the government has subsidized a full-time employee’s healthcare through tax deductions or other means. This is commonly known as the employer mandate. In July 2013, the Internal Revenue Service delayed enforcement of this provision for one year.
Understanding Why Medicare Supplemental Insurance Is So Beneficial
There are a lot of older people who are now finding that they need to have a way to pay for a variety of costly medical treatments. From special therapy treatments to surgical procedures, these costs are often quite high and can go well beyond any health insurance coverage that they already have in place. Even if they have a simple insurance plan in place through Medicare, it is only a plan that will cover up to 80% of whatever the complete amount is.
Whenever there is a costly procedure lined up, that 20% can mean a whole lot of money to have to pay out of pocket. If you do not have the overage, then you are not going to be able to get the treatment that you need. Once borrowed, you will have to pay the money back and you could be subject to fees especially if you try to take out a loan. Instead of worrying about where that extra 20% is going to come from, you have the ability to sign up for Medicare supplemental insurance to help you get the coverage that you need. In the end, you will be able to have your costs brought right down to zero and you will have the treatment that you need.
Medicare Supplemental Insurance Plans
The plans for Medicare supplemental insurance are known as Medigap. There are ten plans in all with Medicare plan f being the most comprehensive. These plans that are available at your local insurance companies and are looked upon as an add on to your main health plan. As you age, you will want to take Medicare supplemental insurance seriously as this is a way to help take care of any extra expenses that you may incur on procedures once you are over the age of 65.
Whatever your medical care needs may be, you have the ability to pick from one of the different Medigap plans. You can find out more about these supplemental insurance plans simply by contacting your local insurance agent or by looking for further information online.
Life Insurance for the Over 70’s Crowd
Although some people may think that they are too old for a life insurance policy once they hit 70 years or age this is really not the case.
People in the United States and the rest of the western world are living longer and longer – 70 used to be the new 60, for many people it is now the new 50! People are living longer and enjoying good health for many more years than just a few short years ago, which is why it is not unusual for someone in their 70’s to have a life insurance policy.
It is important to have adequate life insurance coverage in your 70’s and beyond for a number of different reasons depending upon individual circumstances. Many people take out this type of life insurance policy to be sure that their loved ones won’t have to worry about paying for funeral expenses once they have passed away. This can be a great source of comfort for people as they approach their old age – life insurance for many is still just as important in their 70’s than it was during their 30’s, 40’s, 50’s or 60’s.
Once you reach 70 years of age your health history will have a lot of impact on the type of life insurance cover you can get. If you are relatively healthy, are a non-smoker and lead a fairly active lifestyle then affordable life insurance premiums are definitely possible.
Some people in their 70’s also think about taking out a life insurance policy so that they will be able to leave something behind for their loved ones – this becomes increasingly important to many as they get older.
Managing Your Money: The Key to Wealth
The key to financial prosperity is simply good money management. Instead of living day to day, money management allows you the luxury of relaxing and not having to stress in cases of unexpected events and emergencies. Money management helps whether your goal is to save enough to cover six months of expenses as financial advisors recommend, or you are trying to pay off debts. With good money management you can even do both simultaneously.
The first step to effectively manage your money is to create a budget. Outline your income and your expenses and prioritise your purchases. Make a record of all purchases, regardless of how trivial. Knowing what you spend your money on helps you understand how you can spend your money more wisely. Remember to make your budget realistic and be honest with yourself. Budget your debts, savings and money for fun.
Money can also be better spent when you borrow or rent items instead of purchasing. Movies, textbooks, tools and equipment can often be rented or bought used instead of purchasing them new. For example college students may considering buying e-books or used textbooks online or borrowing from libraries to minimize spending. Weigh the cost and convenience of purchasing these items against the cost and convenience of borrowing or renting based on how frequently you use these items.
Be conservative with credit cards. Instead of falling into the trap that credit cards set by giving you the illusion of unlimited spending, treat your credit cards like cash and spend within your earnings. There are no prizes for reaching the limit on your credit card each month. Low credit utilization is an important part of handling credit cards. This means that the debt you incur by using those cards is only a small portion of the limit on those cards. Except in emergencies, spend only the money you have and not potential earnings.
The best tip is saving your money. You may feel like you can’t pay off debt and save at the same time but in truth that is the most logical thing to do. If not, eliminating your debt may be redundant if immediately after you find yourself in an emergency which you have to borrow money to handle. Have a bank account that you do not touch and create an automatic transfer of a portion of your income monthly. Financial advisors refer to this as “paying yourself first,” the idea being that saving is easier if the money never passes through your hands. Surpluses in your income don’t always signal time for a shopping spree, remember to also put away a portion of the extra money where it can be afforded.
Take advantage of technology for example free apps that help you budget or track your spending, using spreadsheets to outline your budget. Seek lower interest rates and shop around for better deals before you fork out your money. Once you begin paying attention to how you handle your money you’ll be amazed at easy it is to get more bang for your buck.