Beginning in October of 2013, Open Enrollment will begin for 2014 health insurance plans in Indiana for new applicants. The new Exchange (Marketplace) will offer a substantial federal tax subsidy to lower income Hoosier residents. Individuals, families and persons that are self-employed will be eligible. Small businesses will also be able to participate.
The subsidy is designed to help pay for persons that can not find affordable healthcare in Indiana, either through a plan at work or through a private carrier. And because of the mandate from the Department of Health and Human Resources, the law now requires the purchase of coverage.
The US Federal Poverty Level (FPL) will be the driving force behind all of eligibility calculations. The numbers are listed below:
$11,170 - 1 person
$15,130 - 2 persons
$19.090 - 3 persons
$23,050 - 4 persons
Help Is On The Way
With the new medical reform in Indiana, if your income is between 100% and 400% of the income levels above, you will qualify for financial aid. The assistance will be in the form of instant tax credits that reduce healthcare premiums. An added bonus will be the lowering of out-of-pocket costs for deductibles and copays if you qualify for the 100%-250% level. We can help you select an option that costs very little, or another choice that costs more, but has lower expenses that you potentially might have to pay.
If you are earning just 133% of the FPL, you are only required to contribute 2% of your income towards healthcare. The balance will be provided as an instant tax credit. But at 400%, 9.5% of your income is required which will make a large difference. The 200% figure will require an 8.05% contribution. You can find additional Indiana Health Marketplace pricing on our website with free online quotes.
There will be four levels of coverage. They are bronze, silver, gold and platinum. The design of these policies was to provide coverage for specified percentages of anticipated medical expenses for the average single person or family. In order, these percentages are 60%, 70%, 80%, and 90%.Currently, there is not a 100% option, although, potentially, it could become available in certain states.
Obviously, the bronze plan will cost the least since there is more potential exposure to high out of pocket costs. The platinum option will be the most costly since it is expected to pay the most expenses. The silver plan is used in determining the amount of federal tax credit the consumer will ultimately receive. This is regardless of which of the four types of policies you select.
But you can never get a credit that actually exceeds the cost of your coverage. Thus, if the calculated premium is $400 per month, and your subsidy averages $450 per month, you will simply pay no premium, although you will not get the extra $50 per month.
Persons under the age of 30 (since they tend to be the healthiest), can purchase catastrophic policies that will be lower in cost, although they will have more potential for larger out-of-pocket risk. These contracts are expected to become very popular with healthy persons that were previously uninsured.
UnitedHealthcare and Aetna are expected to make available policies that are not directly sold through the Exchanges. Brokers (including our own website) will provide details, rates and applications to Hoosier residents. Prices of policies and the size of the provider networks will be very competitive compared to Marketplace policies. Since there would be no subsidy paid, these options would be especially attractive to households with income above $95,000 (single persons with income above $50,000).
Health Savings Accounts (HSAs) rates in Indiana should continue to be a popular option for persons over the age of 30 that wish to keep premiums at a manageable level, and also receive some tax help for additional contributions. There will still be a cap to the amount of money that can be deposited into these types of contracts. And your carrier will still negotiate pricing discounts for you.
If you have an existing HSA policy, you should be able to keep it in force.
For low income families, the expansion of Medicaid in Indiana is being discussed. If approved, more than 500,000 Hoosiers would become immediately eligible and would pay very little for their medical coverage. It is also expected that additional employment opportunities could also become available in the state.
The variable is whether the federal government can continue to fund this program. If not, the state HIP program could be expanded, although benefits would not be as rich as Medicaid. But they would be less expensive than purchasing private coverage. Governor Mike Pence will ultimately make the decision regarding the Medicaid issue.
He is still waiting for the federal government's response regarding a recently-submitted proposal. Meanwhile, the General Assemply is in adjournment with more than $10 billion in potential aid riding on what happens next.
Governor Pence also strongly believes that giving consumers more control over their healthcare program results in better treatment and potentially lower prices. His view, which is shared by many people, is that the state government should have more control than the federal government, resulting in local and more cost-efficient decision making.
Low income residents in Indiana will get subsidized assistance for their health insurance. Although the exact amount is subject to change, the new State Exchange and Marketplace will lower medical premiums. And you continue to receive these credits every year you qualify.
UPDATE 10-12-2013 Indiana Health Exchange rates are now published by most carriers (get a free quote at the top of the page). Some of the plans most likely to be purchased include Anthem's DirectAccess, PHP's Marquee, AmBetter Bronze Three, and the MDWise Marketplace policies. Certain counties (such as Kosclusko, Davless, Floyd and Switzerland) will not have large carrier selections available.