The Patient Protection and Affordable Care Act (ACA) commonly called the new health law or the Affordable Care Act or Obamacare, by both friends and foes, was signed into U. S. law on March 23, 2010. Together with the Health Care and Education Reconciliation Act, the law is intended to increase access to health insurance coverage for Americans, including 7 million Californians, and is aimed at reducing the costs of health care.
Covered California (California’s Health Benefit Exchange or Marketplace)
The ACA originally talked about Health Benefit Exchanges, one in each state. More recently, they are often termed Marketplaces. California was the first state in the nation to set up such an entity under the ACA and it is now called Covered California.
The Individual Mandate
The Supreme Court upheld the individual mandate to purchase health insurance.
The ACA requires most uninsured Americans to either purchase health insurance or pay a financial penalty. A majority of the Supreme Court’s Justices, in an opinion drafted by Chief Justice John Roberts, decided that the individual mandate was constitutional. The financial penalty for not purchasing health insurance is considered to be a form of taxation, and Congress is allowed to create new taxes.
The ACA bars insurers in the individual and small-group markets from denying coverage to people with pre-existing health problems, charging higher premiums based on their health and, in 2015, placing annual and lifetime limits on covered benefits. Without the individual mandate, these new consumer protections would cause sharper premium hikes because they would encourage older, sicker people to get coverage, while healthy people would wait until they get sick to buy insurance. The mandate is designed to discourage this behavior and promote a mix of healthy and less-healthy people to enroll for coverage. That diversity of new enrollees is designed to help keep premium costs in check.
The individual mandate is important to people living with mental illness because it allows health plans to provide both more affordable coverage and coverage that includes, for most plans, important patient protections. Without the individual mandate, many experts believe that coverage would cost more and insurance companies would be unable to implement new insurance protections contained in the ACA, including extending coverage to age 26 for dependents on their parents’ insurance, guaranteed coverage (and renewal), a ban on pre-existing condition exclusions and a ban on annual and lifetime limits.
The ACA also requires that qualified health plans offered through health insurance marketplaces provide coverage for mental health and substance use conditions at parity with other health conditions. This means that people with mental illness who live in states with limited or no parity protections will finally be able to buy health insurance for mental health and substance use conditions at the same rates and costs as their other medical care.
Marketplace plans will be divided into four categories based on the portion of medical expenses they cover: Bronze plans cover 60 percent; silver plans cover 70 percent; gold plans cover 80 percent and platinum plans cover 90 percent. Plan members pay the remaining portion. However, plan members may also be eligible for off-setting tax credits that can be taken as a monthly premium reduction or at the end of the year.
The marketplaces will also offer “catastrophic coverage” for people under age 30 and those aged 30 and over with low incomes who can’t get affordable insurance or who have a hardship exemption from the individual mandate.
Catastrophic plans protect against high medical costs from accidents or a major illness.
Covered California has a marketplace specifically designed for small businesses with 50 or fewer employees. Employers with fewer than 25 full-time employees may be eligible for tax credits worth up to 50% of their premium contributions.
Employers with at least 50 full-time workers must provide affordable health coverage or face a $2,000 fine per worker after the first 30 employees. In separate announcements posted July 2 on the White House blog and Treasury Department’s blog, officials said the employer coverage mandate will be delayed until 2015 to provide businesses with more time to comply with its reporting requirements.
The U.S. Department of Treasury’s decision to postpone the employer mandate until 2015 allows regulators to streamline the rules that businesses would be required to follow under the landmark legislation. More than 70,000 pages of regulation have already been written to implement the legislation.
Businesses that do not offer healthcare benefits to employees will not be subject to the penalty provisions under the ACA until 2015. The Obama Administration also postponed implementation of the employer reporting requirements until 2015.
For the majority of large employers, the delay will have no impact. Most large firms currently offer coverage to their employees. Small businesses with fewer than 50 workers were already exempt from the rules and will also see no changes.
Individual Coverage Outside Covered California
Starting in 2014, no matter how you buy your health insurance—through Covered California, directly from an insurance company, or with the help of an agent or broker–all plans for individuals and small groups must cover the same set of essential health benefits. They include doctor’s visits, hospital stays, preventive services, prescription drugs, mental health, and other categories of coverage.What’s the difference between Marketplace health plans and other private plans?
The individual market has long been problematic for health care consumers. It’s known for high customer dissatisfaction and turnover, high coverage denial rates, lean benefits and premiums subject to frequent increases.
The new rules guarantee access to individual and small-group coverage regardless of current or past health problems. They also require each plan to cover at least 60 percent of medical costs, and in 2015, limit annual out-of-pocket costs, such as co-payments and deductibles. The new consumer protections also limit the amount that older plan members may be charged; outlaw annual benefit-spending limits; and no longer allow insurers to vary rates based on gender, occupation or medical claims history.
The new rules do not mean that everyone saves money.Individual Health Coverage: New Rules Impact Premiums and Coverage
Medi-Cal is a state-federal partnership program that funds health care for low-income, at or below 138% of the Federal Poverty Level, Californians. The ACA will allow California to offer Medi-Cal to more Californians, including children and adults living with mental illness. Because traditional Medi-Cal covers children, their parents, pregnant women, older adults 65 or older, and people with disabilities, the new population includes childless adults between 18 and 65 who are often the “working poor” – or individuals living with mental illnesses who have not been determined disabled.
This What is Affordable chart for Covered California begins where Medi-Cal ends, at 138%. What is Affordable?
All individuals covered by Medi-Cal, Expanded and Traditional will use the new Modified Adjusted Gross Income (MAGI) method of determining income and may disregard the first 5% of their income (thus, 133% magically becomes 138%). However, the Expansion population will not need to consider assets. The New Health Law: California Issue Briefs
To be clear, people who are eligible for traditional Medi-Cal will continue that eligibility. Expanded Medi-Cal is for individuals who meet the income criteria of Medi-Cal but not the other criteria. That often includes people who have not been determined disabled or who have been unwilling to see a psychiatrist to obtain that disability determination. That distinction will continue. It does not apply only to those already enrolled in traditional Medi-Cal. Individuals who meet severity of illness criteria but have not yet been determined disabled and are in the expanded Medi-Cal program will be served by county specialty mental health programs through coordination with the Medi-Cal managed care plans.
The current Bridge to Reform program called Low Income Health Program (LIHP), Consumer Information – Local Low Income Health Program (LIHP) Contacts , will be transitioning into expanded Medi-Cal. This means that people who are already established with a LIHP plan may stay with that plan resulting in continuity of care. People may also change to another of the approved plans offered in their county of residence.
Many of the health care plans offered by Covered California will also provide managed Medi-Cal coverage. Medi-Cal Eligibility and Covered California – Frequently Asked Questions
The federal government has pledged to pay all medical costs for the newly eligible (Expansion) Medi-Cal enrollees in 2014, 2015 and 2016 and no less than 90 percent of their costs thereafter.
Traditional Medi-Cal is the program that Californians have known for nearly 50 years. It is health insurance for individuals who meet the financial and non-financial criteria. The mental health community knows it best for the services it provides to people living with mental health disabilities. For the past year and a half, the state has required that Medi-Cal services be delivered via managed care.Specialty mental health services are “carved out” of Medi-Cal and are provided by county Mental Health Plans. This allows each county to set its own priorities as long as it delivers required services and to use some flexibility in creating and implementing programs.
Traditional Medi-Cal eligibility will not change significantly when health care reform is implemented. However, counties will have to work closely with the Medi-Cal managed care plans to both foster coordinated care and help individuals whose eligibility for traditional Medi-Cal, expanded Medi-Cal, and Covered California changes for financial or medical acuity reasons.
Traditional Medi-Cal remains a 50/50 state/federal program
The Mental Health Parity and Addiction Equity Act requires insurance groups that offer coverage for mental health or substance use disorders to provide the same level of benefits that they do for general medical treatment. Since the ACA lists mental health and substance use treatment services as an Essential Health Benefit, virtually all insurance and managed care plans must offer those services and are subject to the federal parity requirements. Mental Health Parity and Addiction Equity Act Information
Note that parity does not mean offering the exact same services to a behavioral health (term that includes both mental health and substance use disorders) client as to a medical services client since the needs are different. It includes quantifiable measures such as the amount of co-pay and non-quantifiable issues such as the kind of utilization review demanded.
Essential Health Benefits
The California legislature has chosen the benefits included in the Kaiser Foundation Health Plan Small Group HMO 30 policy as the state’s benchmark for 2014 and 2015. In addition to the minimum suite of essential health benefits available in this benchmark plan, a number of additional benefits will continue to be mandated, including: medically-necessary basic health services (e.g., physician services, hospital and inpatient ambulatory care services, home health services, etc.); HIV testing and AIDS vaccines; certain medically-necessary equipment and supplies for diabetes treatment; breast cancer screening, mammography, and mastectomies; various kinds of cancer screenings; and clinical cancer trials.
Newly stated benefits are inpatient, outpatient, habilitative, and rehabilitative mental health services as well as chemical dependency services, including inpatient detoxification, outpatient evaluation and treatment, and transitional residential recovery services.
Watch for a full list on the Covered California website soon.
Coordinated care is a worldwide trend in health care reforms and new organizational arrangements focusing on more coordinated and integrated forms of care provision. A managed care plan manages both mental health and other medical benefits. Managed care as a means of delivering coordinated care and controlling costs became mandatory for Medi-Cal beneficiaries in 2012. The Department of Health Care Services contracts for health care services through established networks of organized systems of care, which emphasize primary and preventive care. Remember, Specialty Mental Health Services are carved out to the counties so some people will still receive mental health Medi-Cal services through their counties and other health services through their managed care organization. Medi-Cal Managed Care Consumer Guide
About 1.1 million low-income seniors and people with disabilities in California receive health care services through both the Medicare and Medi-Cal programs. These people commonly are called dual eligible beneficiaries or “dual eligibles.”
The state Medi-Cal program and the federal Medicare program are partnering to launch a three-year project to promote coordinated health care delivery to “dual eligible beneficiaries.” The program will be called Cal MediConnect and will be implemented no sooner than April 2014 in eight counties: Alameda, San Mateo, Santa Clara, Los Angeles, Orange, San Diego, Riverside and San Bernardino.
A new website has been launched to help military service veterans and their families know what the Affordable Care Act means for them.
Veterans receiving health care from the Department of Veteran Affairs won’t be seeing any changes in their benefits or out-of-pocket costs under the national health reform, but there may be opportunities for family members, according to a VA news release on August 6, 2013. Obamacare and veterans, a website
The new website is VA, Affordable Care Act and You. You can also call 1-877-222-VETS (8387), Monday through Friday from 7 a.m. to 9 p.m. or Saturdays from 10 a.m. to 2 p.m, Central time.
Great, How Do I Enroll?
You can find out what you are eligible for and enroll or begin enrollment at the Covered California Website. The enrollment screen will be in place on October 1st – we will insert the link HERE. Many assisters, navigators, and insurance agents have been trained in hopes that there will be no “wrong door.” For instance, county family resource centers will have staff who can help you with Covered California eligibility as well as Medi-Cal eligibility and hospitals, too, will be able to help you get the enrollment process underway.
The California HealthCare Foundation Center for Health Reporting at the University of Southern California hosts a regular column by Emily Bazar on the ins and outs of the Affordable Care Act. Look for your concerns at: Ask Emily: Answers to consumer questions about Obamacare . If you don’t see what you are looking for, send her a message at AskEmily@usc.edu .