Glass: My health insurance is going away. What now?
October 14, 2016
Regardless of who is elected president, the Affordable Care Act (ACA) will not change for calendar year 2017. The biggest changes for 2017 include:
1) we have fewer insurance companies to choose from;
2) the tax penalty will be the greater of 2.5% of your income or a flat amount yet to be determined (but likely to be at least $ 700); and
3) rates in most cases are increasing.
So what are our options?
Connect for Health Colorado: This is our state exchange. If you need an individual plan, and if you are eligible for a federal premium subsidy (incomes of $15,800 – $47,500 for individuals; $32,300 – $97,200 for a family of four) then this is likely your best bet. The premium subsidy is ONLY available via plans purchased from the exchange. Your only option will be an Anthem HMO, but the network in Grand County is identical to their PPO network, and there are no gatekeeping referral requirements.
Individual plan outside of the exchange: Rates are typically identical on individual plans offered within or out of the exchange. There will be more insurers and plans available, but at this point, the rates will be considerably higher than in 2016.
Other home addresses: Rates in Grand and other rural counties are higher than rates in Denver. There will be an article detailing the reasons for this in the near future, but for now suffice to say that the cost of care here is higher than in Denver. I know of some who have family in Denver and use their address to obtain lower rates. Do you really want to get into a residency battle while negotiating a $200,000 claim? That being said, if you truly have multiple residences, look into the most advantageous one to declare as your primary residence.
A group health plan: In the past, in order for an employer to offer a group health insurance plan, they were required to 1) pay a significant portion of the employee premium; and 2) have 75 percent of their employees be enrolled. This "participation requirement" was designed to assure that the insurance companies had a fair distribution of healthy and unhealthy enrollees. The removal of this requirement will drive rates higher still.
By complying with some strict dates of enrollment (enroll between Nov. 15 and Dec. 15 for a January 1 effective date), a business owner can offer a group plan to their employees without the large contribution to the employee premium; and without a requirement of large participation. With a group plan you get:
1. More options; 5 insurance companies offering over 150 plan options, as opposed to only one insurer with 15 plans for individuals via the exchange
2. Lower premiums; Rates for group plans in Grand County are priced about 17 percent lower than individual plans.
3. And in many cases, better tax treatment; the employer contribution to the employee premium is tax deductible to the employer, and not taxed as income to the employee.
Sound confusing? I can't say that I blame you. Rocky Mountain Benefits can help you and your employer determine the best course of action. Call us (303-674-4773), email us (Leah@RMBen.com) or come to an information meeting offered by RMBen and the Granby Chamber of Commerce, scheduled at 8:30 a.m., October 26 at the Community Center in Granby. Please RSVP by Monday, October 24 to firstname.lastname@example.org or call 970-887-2311 for more information.
Gary Glass is the founder and owner of Rocky Mountain Benefits, LLC. Started in Evergreen, Colorado in 1995, he now lives in Grand Lake. He received his BA and MBA from the University of Georgia (long ago). His daughter Leah Denzel now handles most of the day to day operations of RMBen. They can be reached at 303-674-4773, or Leah@RMBen.com.
This is the second in a series of articles written by Rocky Mountain Benefits discussing the rising cost of health care in mountain communities. The next article will further address why costs are higher and strategies to address the health insurance crisis.