Oral & Vision Health Blog

Private Exchanges, Federal and State Exchanges…and You

As a consumer in this new health reform world, you may be understandably intimidated. It’s all extremely confusing and there are lots of terms and concepts thrown around that leave you dizzy. One of them is probably the whole online “health care exchange” thing. I know it has taken me some time to wrap my head around all of it. There are private exchanges that benefits companies nationwide have opened. Then there are the public exchanges offered by the federal government and some states.

What the heck are the differences between them? It’s complicated, but let’s try to make some sense of it.

Private Exchanges

More American companies who have previously offered traditional health plans to employees are turning their attention to private exchanges. If your company decides to go down that road, what does it mean for you and your family?

Well first, let’s clarify. Private health care exchanges aren’t a part of the federal and state (public) marketplaces mandated under the Affordable Care Act (ACA). Those were created so individuals could shop for and buy health insurance on their own. Private exchanges have cropped up in the wake of the ACA. National benefits companies are setting them up and signing up employers to participate. So, the benefits company that “sponsors” the private exchange takes charge of negotiating deals with big health insurance companies on behalf of employers and their employees.

So that’s where the concept came from. But really, what are the upsides—and downsides—of health benefits through a private exchange?

Upsides

Private exchanges allow you the flexibility to shop for, compare and purchase plans that meet your needs, using stipends from your employer. Exchanges offer more choices in and control over your health insurance. For example, a woman in her mid-50s has very different needs and preferences in health care than a man in his early 20s. Having the flexibility of plan choices allows each of them to pick one that fits their lifestyles. You can feel more satisfied about your health plan because you selected the best coverage for you and your family.

Downsides

While some employers using exchanges will pay the same percentage of employees’ health premiums, some are moving to a fixed premium amount. Meaning, the employer would pay the fixed amount, and you would have to make up the difference. There’s a fear that private exchanges signal deterioration in employee benefits—that employers will avoid paying a certain percentage of health insurance costs.

Shopping Tips

You’ll be able to choose from a “menu” of health plans that your employer has chosen. You know best about the health care needs of you and your family. If you get stuck, private exchanges are staffed with representatives who can answer questions and help you navigate the site if you get stuck. The biggest challenge will be moving from your traditional open enrollment that typically occurs physically in your office to a virtual open enrollment. Just don’t be afraid to reach out for assistance. Use the exchange’s help center if you need it! Also, have your information and documentation at your fingertips to make things easier when registering, including:

  • Last year’s tax information for you and your family
  • Projected incomes for this year
  • Medical history
  • Social Security numbers
  • Employer and income information for every member of your household who needs coverage (for example, pay stubs or W-2 forms)
  • Policy numbers for any current health insurance plans under which members of your household are covered

Federal and State (Public) Exchanges

The federal Health Insurance Marketplace and the public state exchanges (such as New York State of Health) were created with the passage of the ACA. It’s a new way for Americans—particularly individuals and small businesses—to have access to and the ability to secure quality health insurance.

The public exchanges are intended to be a simpler way for people to purchase health insurance. With one application, you can find and compare plan options, see if you qualify for lower costs, and choose coverage that best meets your needs and budget.  You’re also be able to make apples-to-apples comparisons of plans before you buy, and you can't be denied coverage or charged more because of a pre-existing condition.

October 2013 marked the beginning of a six-month open enrollment period.  Consumers have until March 31 to sign up for coverage that starts in 2014.

Let’s do upsides and downsides of the public exchanges.

Upsides

First, three words: Essential Health Benefits. These are services that must be covered under all plans. Includes but is not limited to:

  • Pediatric dental services
  • Ambulatory patient services (outpatient care you get without being admitted to a hospital)
  • Emergency services
  • Hospitalization (such as surgery)
  • Maternity and newborn care (care before and after your baby is born)
  • Mental health and substance abuse services, including behavioral health treatment (counseling and psychotherapy)
  • Prescription drugs

Other upsides:  You can’t be refused coverage or charged more because you have a pre-existing health condition. Coverage for dependents is extended to age 26 (FL is to age 30). Unlimited lifetime limits on coverage is required. And, additional preventative care for women and children (such as contraception, breast cancer genetic test (BRCA) counseling, autism screening at 18 and 24 months, and more) must be covered at no cost.

Downsides

The federal website has had its share of technical difficulties—and so have some state exchanges. And, there’s that coverage mandate. The ACA requires you to obtain health insurance or pay a penalty equal to $95 or 1 percent of income for 2014; $325 or 2 percent of income for 2015; $695 or 2.5 percent on income for 2016 and beyond. The mandate’s intention isn’t to be a downside necessarily; rather, it’s to give a financial “push” to consumers to go online and get the insurance they need.

Shopping Tips

Without a doubt, the idea of purchasing health insurance on your own—and online—is a big change in the way we choose and obtain benefits. And the exchanges have received some bad press around the supposed “ease” with which people can apply. Regardless, shopping on the public exchanges has been compared with shopping for car insurance. Same concept.

First, you’ll need to find out if your state has its own exchange. If it doesn’t, you’ll need to use the federal exchange (36 states are using it). A simple Google search can let you know. Once you’re on the federal or your state’s site, you’ll sign up by entering basic information including your family size, tax information, income and medical history. Tip: Be honest with your answers—purchasing health insurance is a tax and you may be eligible for premium tax credits. And, have the same documentation as listed above for private exchanges. Nothing slows you down more than having to stop in the middle of the process to go find paperwork!

Phew! Got all that? I know, it’s difficult to understand it all and it’s a lot to take in. But with some research and organization, you can leverage these online platforms to make the best health care choices for you and your family.

 

New Call-to-Action

comments
0