The Latest OnWhat Is Coming

In 2014?What I Learned from the

Humana Webinar #2*

*some material taken directly from the Humana Power Point

State Decisions on Exchanges

Exchange Timeline

• July 2013 - Federal and Partnership Marketplaces register and train agents

• August 2013 – Agent Marketplace training completed, publish agent lists, individual products

• September 2013 – Federal and Partnership Marketplaces publish agent lists (small group)

Exchange Timeline

• October 1, 2013 to December 15, 2013 is Open Enrollment for 01/01/2014 effective date.

• December 16, 2013 to March 31, 2014 continuing enrollment– If application is finalized between the 1st and

15th of the month, the effective date will be the first of the following month.

– If between the 16th and the end of the month, effective date will be the first of the second following month

Exchange Timeline

• April 1, 2014 to September 30, 2014 will be Qualifying Events enrollments only– Marriage, divorce, job change, plan

termination, etc.– This means someone cannot go without

insurance, get diagnosed with an illness or have an accident and then buy health insurance on the exchange.

What can I do now?

• Reach out to clients and calculate their FPL and potential subsidies

• Set an appointment date in Oct to discuss their options

• Stay up to date on your state’s decisions• Talk to small businesses without group health

about a defined benefit plan to allow their employees to pay for their individual health insurance with pre-tax dollars now.

• Encourage them to lock in today’s rates now.

Why Are Premiums Going Up In 2014?

• Only 3 Age Bands (currently 5 in 41 states)• No Underwriting (guaranteed availability)• New Taxes and Fees on Premiums• On average, plans will have more benefits due

to mandated Minimum Essential Benefits• Know these things so you can explain to your

customer why there is going to be further price increases

• Use this to create urgency to buy now

Essential Health Benefits

• Plans must cover 10 categories of mandated essential health benefits

1. Ambulatory Patient Services

2. Emergency Services

3. Maternity and Newborn Services

4. Pediatric Services Including Dental and Vision

5. Rehabilitative Services and Devices

Essential Health Benefits

6. Mental Health and Substance Use Services

7. Preventative and Wellness Services and Chronic Disease Management

8. Hospitalization

9. Prescription Drugs

10. Laboratory Services

Exchange Plans

Remember these percentages

Federal Assistance on the Exchange

• Help your customer determine if they are eligible for financial assistance on the exchange (subsidies)

• Use the calculator on your USABG Agent Website

Federal Assistance on the Exchange

Federal Assistance on the Exchange

Federal Assistance on the Exchange

Plug in the numbers

See the results

What is the Federal Poverty Level?

Exchanges: Your Book of Business

• Many of the 30 million new to health insurance will go on the expanded Medicaid program

• Group 1- low income, must purchase on Exchange to qualify for subsidies

• Group 2 – Option to purchase On or Off the Exchange, will not receive subsidies

• Group 3 those who opt to pay penalty/tax– These may be candidates for limited benefit

or short term plans

Who is Eligible?

• Individuals and Families with incomes between 100 – 400% of FPL (Group 1)

• Cannot be Medicaid or Medicare eligible• Some people on group insurance today

– Employer no longer offers coverage– Employer coverage is not affordable

(premium more than 9.5% of income)– Employer coverage does not provide

Minimum Essential Coverage

Financial Assistance Available On the Exchange - 2 types of assistance

• Advance Premium Tax Credits – For clients who are 100 to 400% FPL – Ensure that your clients do not have to pay more

than a percentage (9.5%) of their income for health insurance premiums

• Credit applied at time of monthly premium payment (paid to the insurance company)

• Based on household income of the most recent tax return available– If entered income is not correct, you may owe

money back at time of tax return; or you may get a refund

Financial Assistance Available On the Exchange - 2 types of assistance

• Cost-Sharing Subsidies – For clients who are 100% to 250% FPL– Protects your clients from high out-of-

pocket costs at point of service. Adds percentage to the actuarial value of the Silver plan.

Assistance Example 1

• Bob’s family of 4 Household income of $75,000, FPL 318%• Because Bob’s FPL is less than 400% but more than

250%, they only get the Advance Premium Tax Credit.

Assistance Example 2• Betty 60, Household Income $20,000, FPL 174%• FPL less than 250%, she gets Advanced Premium Tax Credit, plus Cost

Sharing Subsidy of 87% on the Silver plan. (Silver standard 68 - 72% plan)

Plan Continuation

• Customers will be able to keep their current plans into 2014 and at renewal apply for an exchange or off-exchange plan, or keep their plan and it will be upgraded to ACA compatible

• They purchase a plan today with 6/1/13 eff date, in Oct they can see if the exchange plan with subsidies is a better option.

• If not, they can keep their plan until 5/31/2014 and then change.

Coordination between Privateand Public ExchangesFinal exchange regulations enable States to allow agents and brokers that operate a “web-based entity” to sell individuals health plans offered on the “public” exchange…qualifying individuals may use subsidies for this purchase.

If a State chooses to work with a web-based entity, the entity must• Make sure that the individual completes a single, streamlined

eligibility verification and enrollment application through the “public” Exchange.

• Provide consumers the ability to view all plans offered through the “public” Exchange.

• Provide standardized comparative information on each available QHP• Allow consumers to go directly to the “public” exchange website if

they choose.• State exchanges will determine how brokers can be compensated for

bringing business to exchanges

Final Thoughts

• Exchanges and subsidies should free up some premium dollars to put into Total Protection products.

• It is going to be confusing for most people. They are going to need your help.

• Federal exchanges will only offer the metallic health plans

• We can have Private Exchanges and offer all our products.

• October open enrollment will be our opportunity to make huge commissions in 2½ months. How many people can you enroll?