This is a final reminder! Today is the last day for you to purchase health insurance through the Health Insurance Exchanges (HIXs) for a January 1, 2014 effective date! If you purchase insurance through the HIXs after midnight tonight, your effective date will be in February 2014 or later. After the first of the new year, your effective date on the exchange will be the first of the month following purchase. Open enrollment for 2014 ends on March 31.
Initially, the deadline to purchase health insurance on-exchange with a January 1 effective date was December 15. In November, this date was postponed to December 23 after technical difficulties continued with the online enrollment processes. Since the inception of the HIXs, the government’s healthcare website has been fraught with problems, which have affected both consumers and the insurance carriers offering health plans on-exchange.
While the federal website seems to be functioning at this time, certain components of the enrollment process still do not work. One of the most important aspects of purchasing health insurance - making the initial premium payment - is still problematic. On Friday, an internal manager at Humana reported to me that less than a third of their on-exchange applications have been able to process the initial premium payment at the time of application. Consequently, health insurance carriers are extending the deadline for the payment of the first month’s premium until January 10, 2014 for on-exchange policies effective January 1.
Difficulties with other aspects of the ACA have prompted concessionary actions. As non-grandfathered health insurance plans must, from 2014 on, provide the benefits, rights, and protections mandated in the ACA, many consumers have had their health insurance plans cancelled as of the end of 2013. On December 20, 2013, the government responded to this widespread loss of coverage: those who had insurance plans cancelled due to ACA provisions will be eligible for a “hardship exemption” in 2014. This exemption will make them exempt to the tax penalty imposed for not having health insurance in 2014. This exemption is also extended to those who would need to pay more than 8% of their household income on health insurance, those with incomes below the threshold required for filing taxes, those qualifying for religious exemptions, undocumented immigrants, those who are incarcerated, and members of Native American tribes. Some argue that the penalty for not having an insurance plan in 2014 should be rescinded entirely; but as of the date of this post no announcement to that effect has been made.
The implementation of ACA has been anything but smooth, as evidenced by continuing technological difficulties, mass cancellation of existing insurance policies and large premium increases (typically about double the current cost) for those purchasing ACA-compliant plans without any federal subsidy. Many consumers enrolling into on-exchange plans are finding that their preferred medical providers are not in the network, so they would need to change their doctor(s) to use their insurance policy. As far as how the ACA will play out over time is anyone's guess; but so far the delays and "adjustments" to the rules do not portend success of the program, at least to the extent envisioned by its creators.
Here is a brief summary of the delays and new deadlines to date:
The Small Business Health Options Program, known as the SHOP exchange, will not offer online enrollment until November 2014. This is a one-year delay from the initially planned launch for last month; however, small businesses still have the option to purchase SHOP plans through a broker or agent.
Employers buying on-exchange plans for their workers in states with federally-run HIXs need to work through an agent, broker, or insurance company. Technical problems have rendered the government website well-nigh impossible to use for employers.
A Spanish-language sign-up tool was to be implemented for individuals purchasing insurance through HIXs. It has been delayed, and has not yet seen the light of day.
The last day to sign up for insurance effective January 1 was delayed from December 15, 2013 until December 23, 2013.
The last day to pay the first month’s premium for an on-exchange policy effective on January 1 is January 10, 2014.
The last day to sign up for insurance without penalty was delayed by six weeks (originally February 15, 2014 and now March 31, 2014).
The Open Enrollment Period for 2015 coverage has been delayed by a month; it shall now open on November 15, 2014 and end on January 15, 2015.
Employers with more than 50 employees will have until 2015 to provide ACA-complying insurance without penalty.
Until next time,
Andrew Herman, President
AH Insurance Services, Inc.
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