Health exchanges and impact on employees that have coverage through their employer

Employees may not qualify for subsidy

BOCA RATON, Fla. - The Affordable Care Act does more than just provide insurance for the uninsured. It may also change things if you're insured through a group plan.

Tax breaks or subsidies will be provided to offset the cost of plans in the marketplace, but you have to qualify for these discounts. It's based on your income and your access to insurance through your employer.

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"We have 28 employees," owner Rick Howard explained.

Health insurance is a big expense for small businesses, but Howard feels its an important benefit. He offers insurance, but isn't sure what the plan will look like next year because the Affordable Care Act is changing the industry.

"First we had to educate ourselves and that's been a monumental exercise in frustration because the deeper we get the more confused we get," Howard said.

Howard sent a letter to his employees explaining their options. He used the government's form letter and informational pamphlet. Many companies are sending these notices by October 1.

Here's what the notice will look like if you are offered insurance through your employer.

Here's what the notice will look like if you are not offered insurance.

Howard believes the government information just confused everyone even more.

"The frustrating part for me is that I can't be particular because I don't know the particulars. It's tough," Howard said.

Plastridge Insurance broker Joshua Dorman says employees can begin weighing their options.

There are 3 questions you should ask:

1. Does the plan meet minimum essential guidelines?

The government said a plan meets this if it is designed to pay at least 60% of the total cost of medical services.

Dorman said the plan must also cover the essential health benefits which include hospitalizations, ER services, ambulatory patient services, maternity and newborn care, prescription drugs, mental health and substance abuse disorder services, rehabilitation, lab services, pediatric services, and preventive and wellness services.

2. Is the plan affordable?
The government considers a plan affordable if the employee's share of the annual premium for the employee only (not a family plan) is not more than 9.5% of the annual household income.

3. Do you have to wait more than 90 days for coverage upon hiring?

"If those three qualifications happen you may not be eligible for a subsidy," Dorman explained.

Even if you don't qualify for a subsidy, Dorman said you can still buy insurance through or off the exchange. He expects the same plans and perhaps more will be offered off the exchange at the same rates.

If you voluntarily go with private insurance rather than through your employer, you'll pay full price and you'll pay for the premium "after" taxes.

Most employer plan premiums are on a pre-tax basis and the employer often makes a contribution toward your premium.

"I'm going to Washington D.C. with the Chamber in October and hopefully we'll get some answers," Howard explained.

One answer Howard does know, insurance premiums are going up at least 8-percent.

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