Today marks the beginning of a seismic shift in the state’s health-care industry with the opening of Covered California, a health insurance marketplace that offers a variety of coverage options direct to consumers. It’s the cornerstone of the hotly contested implementation of the Affordable Care Act (ACA), also known as ObamaCare.
To help Sonoma County residents understand what this change will mean for them, 1st District Supervisor Susan Gorin hosted a meeting last Thursday at Altimira Middle School, during which a panel of experts discussed the law and took questions from the audience of about 40 attendees. The speakers ranged from representatives of the county’s Department of Health Services, to the Sonoma Valley Chamber of Commerce.Each spoke about different aspects of the new law and how it will affect various stakeholders, from the business community to new immigrants.
The meeting was briefly interrupted when an audience member began shouting at the dais in what appeared to be a staged protest against the ACA. The protestor, who refused to identify herself, ignored repeated requests for order from officials, and left only when other attendees shouted back for her to “shut up.”
Of the 70,000 Sonoma County residents who currently live without health insurance, approximately 50,000 will be eligible for insurance under the Affordable Care Act. However, not all 50,000 will sign up in the first year. Dr. Abraham Daniels of the Department of Health Services said, “We want to enroll 13,500 in Medi-Cal, as well as 12,000 into Covered California in the first year.”
Medi-Cal, California’s version of Medicaid, will be expanded to cover a wider range of patients. In 2014, people under age 65, including those with disabilities, with an annual income of less than $15,856 for a single individual or $32,499 for a family of four, can sign up for Medi-Cal. No longer will assets, such as owning a house or car, count against a person’s eligibility for the state-provided insurance.
“Right now, to be eligible for Medi-Cal, there has to be a child somewhere in the picture,” said Cheryl Johnson, chief executive officer for the Sonoma Valley Community Health Center, explaining that under Medi-Cal expansion, single people who meet the income requirements will be able to qualify.
For those who don’t meet Medi-Cal’s salary requirement, Covered California offers a variety of tax subsidies based on income. Those who make between $32,500 and $58,875 for a family of four (or $15,860 to $28,725 for a single adult) will receive financial assistance to pay for deductibles and co-pays as well as a tax credit to lower monthly premium rates. Families of four who have a total combined income from $58,875 to $94,200 (or $28,725 to $45,960 for a single adult) will qualify for a tax credit for lower monthly premiums. Income is measured by what a family or individual takes home after state and federal taxes are paid, and can be found on line 27 of most recent tax returns.
How much a family or individual pays for health insurance depends on the level of care desired. Plans range from platinum, which covers 90 percent of “actuarial value” (the share of health care the plan will fully cover) but has the highest monthly premiums; to bronze, which covers just 60 percent of accrued health care costs but comes with a lower monthly premium. While plans will have different price points, all must cover 10 “essential benefits” such as emergency treatment, mental health care and pediatrics; and the maximum out-of-pocket cost for any one individual is capped at $6,350, or $12,700 for a family of four. Covered California has a calculator on its website that will determine the average monthly cost for insurance based on total household income and level of coverage preferred.
Open enrollment for Covered California plans will begin on Oct. 1, for health coverage that will go into effect on Jan. 1.
What follows is an assessment of how ACA impacts different stakeholders.
I have health insurance through my work
Not much will change for the roughly 50 percent of Americans who receive health insurance through their work – employer-provided plans will continue as usual in most workplaces. Employers will be required to notify staff about the health exchange marketplace, and in some cases, buying insurance through Covered California could be more cost-effective for an employee. Employers must inform staff if the insurance provided is deemed inadequate (defined as covering less than 60 percent of “actuarial value”), and those employers will be required to notify staff about tax credits available through Covered California. Some small businesses may decide to drop private employee coverage and seek insurance through the state, as they can get tax credits for utilizing Covered California instead of a private insurer (see section on business owners below).
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