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Despite confusion and opposition, healthcare exchanges will be ready Oct. 1, federal health official says

With about six weeks until the opening of new health insurance exchanges, a federal health official acknowledged Friday there is “a great deal of confusion” about the Affordable Care Act.

Despite continued criticism of the new law, which opponents call “Obamacare,” online enrollment tools will be ready Oct. 1, said Marilyn Tavenner, administrator of the U.S. Centers for Medicare and Medicaid Services.

“It is going to be a long September,” she said.

Speaking at the Charlotte Chamber’s annual Health Care Summit, Tavenner said she and other government officials will spend the next month and a half educating citizens about the exchanges and encouraging them to sign up.

“It would be a shame to have people who want health insurance and didn’t realize it was available to them,” Tavenner said.

One of the goals of the law is to increase access to insurance for individuals and small businesses. Other parts of the law address cost containment and quality by encouraging a shift from paying for each procedure and service to paying for “episodes of care” and improvement in quality. “We need to get more value for the dollars we’re spending,” Tavenner said.

Changing the payment system will take time, she said. “We want to move carefully. The health care sector is one of the strongest sectors in the U.S. economy, and we don’t want to damage it.”

Better access is coming soon. Starting Oct. 1, people without insurance can sign up through exchanges that offer a variety of insurance plans, depending on the state.

North Carolina regulators have approved 67 insurance plans to be offered to the more than 1 million state residents who don’t get coverage through their employer, Medicare or Medicaid.

Premiums have yet to be released. When they are, they’ll be “sticker prices” that many people will not pay because they’ll be eligible for federal tax credits to offset the cost.

Individuals and families will qualify for subsidies, in the form of tax credits, to buy insurance in the new exchanges, or marketplaces, if they have incomes from 100 percent to 400 percent of the federal poverty level (about $24,000 to $94,000 per year for a family of four).

Tavenner, previously secretary of health and human resources in Virginia, said she was aware that North Carolina, like her home state and 19 others, has declined to accept “Medicaid expansion,” that part of the Affordable Care Act that would have provided federal funds to insure more low-income citizens.

Without that, she said many low-income people won’t have an insurance option. But she added: “I’m hoping that once we get going, other governors will come around.”

Coverage starts Jan. 1

Coverage will start Jan. 1, along with penalties for those who are required to sign up but fail to do so. The penalties will be taken out of tax refunds. The law exempts people from mandatory coverage who are at the bottom of the federal poverty scale.

Recent reports about premiums have described everything from skyrocketing increases to modest decreases, Tavenner said.

“There has not been a big spike in rates,” she said. But premiums will differ, depending on where you live and what policy you choose.

Rates are changing because the rules for insurers are changing.

The Affordable Care Act prevents insurers from discriminating against people with pre-existing medical conditions. That will tend to raise premiums as higher-cost individuals who have previously been excluded from the market buy coverage, according to the Kaiser Family Foundation.

That may be offset by an influx of younger, healthier people who will be required to buy insurance or pay a penalty.

Because the law prohibits premium surcharges based on health status and limits premium variation because of age, Tavenner said it will tend to lower premiums for people who are older and sicker and raise premiums for people who are younger and healthier.

The law also establishes a minimum of coverage with some essential benefits, including maternity care. That will generally raise premiums for people who had purchased skimpier coverage but will lower their out-of-pocket costs on average when they use services, Kaiser reported.

Tavenner said small businesses with fewer than 50 employees are not required to buy insurance for those employees if they don’t want to, but small businesses with 50 or more workers must provide insurance, and they can use the exchanges to get affordable plans.

Most large employers won’t be affected by the law, she said, because 95 percent of them already provide insurance for their employees.

‘Navigators’ coming

For those who need help figuring out which plan to buy, or whether to opt out and pay a penalty, Tavenner said the federal government is paying to train “navigators” to explain insurance subsidies, premiums and other provisions of the new law.

So far, the government has announced $7.1 million in federal grants to 36 North Carolina organizations that will train navigators. In July, Charlotte-based C.W. Williams Community Health Center received $109,028; Cabarrus Community Health Centers received $92,528; and Gaston Family Health Services received $248,365.

More information can be found at www.healthcare.gov.

Garloch: 704-358-5078
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