Healthcare in the U.S. has been a prevalent matter of political arguments since the administration of Richard Nixon during the 70s. According to the U.S. Census Bureau, the number of Americans who were not insured elevated in alarming heights between the years 2008 to 2009. The heated argumentation over offering cost-effective healthcare insurance involves exploration of policies and the means that insurance is marketed in the U.S.
Government-run insurance exchanges are a key defining feature of the Affordable Care Act. They are scheduled to come online in January 2014. The exchanges will offer a choice of plans containing a government-mandated Essential Benefits Package. Sliding scale subsidies – in the form of tax credits – will be available to those individuals with household incomes below 400% of the Federal Poverty Level (or about $44,000 per year).
Health insurance exchanges provide individuals with a selection of coverage options that are standardized and controlled by federal or state authorities. Unlike private exchanges, the government exchanges will not be able to offer non-ACA compliant coverage options (such as indemnity policies), and they will not be able to bundle insurance with other insurance and non-insurance products.
The hypothesis of exchanges involve allocating high expenses for select healthcare users over a broader base of insured people. By doing so, it minimizes expenses for policyholders who are at great risk for conditions or those insured while undertaking costly health procedures and treatment programs. Essentially, healthy people engaging in health insurance exchanges subsidize treatment for the sick, making the course economical to all parties involved.
Government-run health insurance exchanges will start to take effect on January 1, 2014. Most states have opted to let the federal government run their exchange, but a number of states have taken steps to create a state-run exchange. Enrollment in the exchanges is scheduled to begin in October 2013, with a limited enrollment period during which people can sign up. Exchanges will be expected to perform numerous roles including the operation of toll-free phone lines and websites to provide information to consumers, guarantee that health insurance policies offered on the exchange meet specific requirements, and deliver data in a standard format to assist consumers in comparing insurance providers and benefits on their plans. Exchanges are also expected to determine qualifications for premium assistance, and help those eligible for Medicare or Medicaid sign up for those government health care programs.
Private insurance exchanges are becoming increasingly popular for both individuals and employers, and they are able to offer a wider range of coverage options and products than the tightly controlled government-run exchanges. You will hear more about the value of these private exchanges as 2014 approaches.
