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Patrick Springer, Published September 29 2013

What you need to know as health insurance marketplaces open

FARGO – A new era in health care dawns Tuesday when enrollment starts for coverage under the Affordable Care Act, better known as Obamacare.

The enrollment period for coverage in 2014 runs through March 31 for health insurance purchased through new online marketplaces, allowing consumers to compare coverage options and prices.

Subsidies will significantly reduce monthly health insurance premiums for those who qualify, according to average figures released by the Obama administration.

The average monthly premium in North Dakota for the second-lowest cost tier, the silver plan, will be $350 and $281 for the lowest-cost option, the bronze plan, according to figures from the Department of Health and Human Services.

Nationally, the average monthly premium is $328 for a silver plan, according to government figures. The silver plan covers 70 percent of projected medical costs for a typical consumer.

The new health insurance marketplace is aimed primarily at two groups – those who are uninsured, or those who must buy insurance individually, where costs run significantly higher than for employer groups.

“The marketplace is not really intended for people who already have good insurance,” including Medicaid or Medicare, said Mike Fierberg, a spokesman for the Centers for Medicare and Medicaid in the Denver region, which includes North Dakota.

Most analysts predict premiums likely will go down for many older people who are heavier consumers of medical services who buy insurance through the new marketplace, and increase for younger, healthier people.

The Affordable Care Act aims to expand insurance coverage in two ways: providing premium subsidies for those whose incomes qualify, and giving states the option to expand Medicaid eligibility.

Premium subsidies are available for people with incomes up to 400 percent of federal poverty guidelines.

Individuals with incomes up to $45,960 would qualify for some level of premium subsidy, for example, as would families with income up to $94,200.

In another example, a family of four with an annual income of $50,000 would qualify for subsidies that would bring the average monthly premium down to $282 in all states.

For a 27-year-old who does not qualify for a premium subsidy, the average monthly cost in North Dakota will be $232, compared with the $214 national average.

A 27-year-old getting subsidies would pay an average monthly premium of $145 in all states.

There’s a major caveat regarding eligibility for subsidies: Those who have coverage through their employer probably won’t qualify.

Also, besides comparing premiums, consumers should evaluate coverage based on a health plan’s network of providers and out-of-pocket costs, including co-pays and deductibles.

North Dakota opted to leave it to the federal government to create and operate the marketplace, which can be found online at www.healthcare.gov.

Minnesota launched its own online marketplace, MNSure, accessible at www.mnsure.org.

There’s no way to predict how many will flock to the new coverage, which provides subsidies to defray the cost for those who meet income guidelines.

In North Dakota, an estimated 131,000 residents are eligible, while 1.2 million in Minnesota qualify, according to official figures.

By entering information, including income and family size, shoppers can compare insurance options in an “easy, consumer-friendly way,” Fierberg said.

Insurers will sell plans under four tiers, with the base established by what are considered essential benefits. The most basic coverage is the bronze category, with silver the next level, gold the next and platinum the highest, and most expensive, coverage.

Price comparisons won’t be possible until the marketplaces launch Tuesday, but the Obama administration has released average monthly costs for the 36 states, including North Dakota, that opted to have the federal government run all or part of their marketplaces.

The average monthly premium for a family of four with an income too high for a subsidy will be $841 in North Dakota, compared with the national average of $774, according to government figures.

In North Dakota, three insurers are selling on the new online marketplace: Blue Cross Blue Shield of North Dakota, Medica and Sanford.

Those companies already comprised the vast majority of the private health insurance market in the state, although eight to 10 firms are active in the state, Insurance Commissioner Adam Hamm said.

By that measure, the Affordable Care Act does not appear to have increased competition, one of the program’s stated goals, at least at the outset, Hamm said.

“It’s going to take some time for it to sort itself out,” he added, referring to the new marketplace’s impact on North Dakota’s health insurance market.

For competitive reasons, insurers aren’t disclosing their pricing until the marketplace launches Oct. 1.

Representatives of Blue Cross Blue Shield of North Dakota and Sanford Health Plan said it will take time to educate consumers and employers about the new options available through the marketplace.

“We’re going to have to do a really good job reaching these people,” said Ruth Krystopolski, president of the Sanford Health Plan. A public education campaign will roll out next week.

Blue Cross Blue Shield of North Dakota also is trying to educate consumers, said Luther Stueland, the Blues, director of health policy impact and exchange operations.

“We think there’s much education that needs to happen,” he said. “We’re doing our best to reach out.”

Both North Dakota and Minnesota opted to expand Medicaid eligibility. In North Dakota, estimates of the number of additional people who qualify Jan. 1 range from 20,500 to 32,000.


Marketplace application checklist:

- Social Security numbers

- Employer and income information for every family member who needs coverage (pay stubs or W-2 forms)

- Policy numbers for any current health insurance plans covering household members

- Completed employer coverage tool, a form available online at www.healthcare.gov


Online

- In North Dakota, for more information about the new Health Insurance Marketplace and to apply for coverage, log on to www.healthcare.gov or call toll-free at (800) 318-2596. Enrollment opens Tuesday.

- In Minnesota, for information or to apply for coverage under MNsure, the health insurance marketplace for Minnesotans, log on to www.mnsure.org, or call toll-free at (855) 366-7873. Enrollment opens Tuesday.


Readers can reach Forum reporter Patrick Springer at (701) 241-5522