Health Insurance Orange County with Crystal Budd,

Crystal: Good morning everybody. It is my honor to be up here to speak to you today about healthcare reform, better known as the Affordable Care Act or Obamacare. As you know, it became law on March 23, 2010, and we’re embarking on the most significant, sweeping changes we’ve ever seen in healthcare that are coming.

One of the largest is of course the issue on pre-existing conditions where people have illnesses, and in some instances have not been able get care, or coverage, they will be able to get that now. They will not ask any more health questions. That’s huge for those that need coverage that haven’t been able to get it one way or another. That means no cancellations, no denials for health coverage regardless of your health, you can get coverage.

If you had a grandfathered plan, that means prior to March 23, 2010, that means your plan was already in place, your plan is considered grandfathered. What grandfathered means is that you’re not subject to all of the changes that have occurred for the Obamacare, for the Affordable Care Act. Because of those changes, those sweeping changes, it’s covered many other things that some of the other plans didn’t cover.

So, the grandfathered plans in and of themselves, if you have it, you can keep it. It may be less expensive for you, it may not be less expensive for you. It just means you can keep what you’ve had. You do not have to go into the new system if you don’t want to, but I do encourage you to look at what’s available to you, because it may or may not be beneficial. So we’ll just have to look at each individual independently.

Open enrollment actually starts October the 1st, so it’s just around the corner, happy fall, and it will go to March 31st. If you do not enroll during open enrollment, and you don’t have insurance you will not be able to get it until the next open enrollment period, kind of like Medicare. It’s going to be very similar as far as that’s concerned. There are special enrollment periods that will be available if you have a birth of a child or someone dies, a spouse dies, you move into a new area. There will be certain situations that will create a special moment period outside of that open enrollment period if needed.

One of the sweeping changes is what they call this “Essential Health Benefits.” These are benefits that are going to be required on all plans that are going to be part of the new Affordable Care Act. They will all have these things, such as ambulatory patient services, emergency services, hospitalization, maternity and newborn care. You can’t get a plan without maternity any longer. Mental health and substance use disorders, some plans covered it, and some plans don’t, they’re all going to cover it. Behavioral health treatment, prescription drugs, rehabilitative, and services and devices, lab services, preventative and wellness services, chronic disease management, pediatric services including dental and vision.

We are all going to contribute to pediatric dental and vision. It’s going to be required on all plans. Whether you have children or not it doesn’t matter, you’re going to help pay for that and subsidize that. All these things, those are your essential health benefits.

There’s going to be four levels of plans. They’re medals, they’re bronze, which is going to be your about 60% coverage when you talk about a higher-end deductible, out of pocket exposure. Then you have your silver, which is kind of like a 70% overall coverage when you’re talking about co-insurance, lower deductible. Then you have your gold one, again, is going to be your 80% type plans co-insurance where you’re going to have more coverage. Then you have your platinum plans. So you have bronze, silver, gold and platinum.

They’ve done it that way because your platinum plans are like a 90/10 plan, meaning you’ve got a 90% they pay, you pay 10%, and so on. You go down to the gold, it’s an 80/20 plan. You go down to the silver, it’s 70/30 and then 60/40 for bronze. So, that’s the basic structure that they’ve set up for all the plans.

Now there’s wiggle room within the carriers how they’re going to look at those co-pays. What’s really going to drive the plans is price, of course, but also they’re also narrowing it so where you can’t go to any doctors out of network. Some plans won’t have the doctors that you want to go to, so you won’t be able to choose those plans. Some will have full networks. Some will have drugs that you’ll want to take, some won’t have drugs that you need. So it’s going to become more, it’s not just going to be price-driven, it’s going to be need-driven based on what doctors you want to go to, do you care, what drugs do I need to have covered, what’s most important to you.

There’s going to be plans that are going to be considered on exchange, meaning if you go through Covered California and you purchase a plan on the exchange, then you are eligible for a subsidy or a tax credit. Then they’re going to have plans that are called Mirrored Plans which are going to be the same exact plans, but they’re going to be considered off exchange. Why would I go on or off exchange? Well, there’s many variables.

It could be I qualify for a subsidy and I want to get that subsidy, and the only way you can get it is by going on exchange. If you make over $94,000 a year, $94,200 a year collectively as a family, then you don’t qualify for any tax credit or subsidies. That’s the maximum it goes up to. For you to fill out the paperwork to try to get a subsidy is like 30 pages because everything’s no more health questions, it’s all financial. If you go off exchange, you already make that, you don’t need a subsidy, you can go off exchange. Six pages, boom, you’re done. Simple paperwork, because there’s no health questions anymore.

It’s all about earnings, what is the bottom line. You’re going to be looking at on your 1040 line 37 is the number they’re looking at. Your adjusted gross income is where it’s going to come into play as far as will you be able to qualify for any subsidies. The ratings, we used to have nine ratings, now they’ve gone to 19, and the reason they’ve gone to 19 ratings is they’re able to shift things based upon what the costs in certain areas are based on what doctors charge, how many doctors are available in a certain area, and that will drive costs up or down. So it just gives them more wiggle room to charge the fees that they want to charge in these plans.

The subsidies that are available, really important is if you don’t hear anything else today, if you want to get subsidy or see if you qualify, you need to be accurate on what you put in when . . . you know, make an appointment, and I’ll run the quotes for you, but you’ve got to be accurate about what you put in for your income. If you don’t have that, and you underestimate, and they give you a subsidy based on a lower figure, and at the end of the year when you go to do your taxes, and you’ve made more money, and you’ve gotten a $300 subsidy and, guess what, they take it away from you, you owe that money back.

They don’t say, “Oh, sorry, it was just a simple mistake, it’s okay.” No. If you falsely say what you earn, and you make a different, you’re incorrect, I don’t want to say falsely, let’s just say you’re incorrect about it or something’s changed, and you make more money, you will pay that money back. So it’s really important to make sure you’re accurate on what you estimate your income to be, and if anything changes, you need to look at that, and adjust it accordingly.

If you do not go through the exchange, again, you will not get any tax credits. You’re not required to go through the exchange. You do not have to do that. If you want to take advantage of any tax credits or subsidies you must go through the exchange. That’s how you get them.

The tax credits themselves will lower your premium. Subsidies will lower your out of pocket costs. That’s what the two things are. There’s two different things that are going on there.

In the marketplace, the companies that are in the exchange right now, there’s Blue Shield, Blue Cross, Kaiser, and Health Net. Cigna is completely off exchange, which is available to purchase their products, and then you have Aetna, who’s totally removed themselves from the market in California on individual basis. They’ve decided not to do that.

The other side of this is what happens with small groups? That’s individual, okay? That’s just in a nutshell individual, and you can see there’s lots of variables, lots of things to consider. My job is to sit down with you and your friends, families, clients that say, “I can’t make heads or tails of this. What’s best for me?” So that’s what I’ m going to be here for you.

I brought lots of my business cards today. I want you to take them, as you have conversations people are going to be talking because they’re going to be confused. They’re going to say, “I don’t even know what I’m supposed to do here. Do I qualify? How do I qualify? What do I need to do?” For small businesses, what they need to do is they need to talk to somebody that has more knowledge then them, somebody that has their interest at heart, and I will do that for them.

So, let’s talk about small businesses. There’s a, it’s called SHOP, Small Business Help Options Program. It’s going to affect businesses with 50 or less employees. If you have 50 or more, they’ve postponed that until 2016, so people with larger businesses, you don’t have to be concerned at this present time. They can keep their groups intact. The tax credits that will be given for businesses that go through the SHOP, they’re going to get up to a 50% tax credit.

Now if you’re a business and you don’t go into the SHOP, and you keep your existing plan, which if you have a group now, you may keep your existing plan until your anniversary date. So let’s say you have a plan that renews in May 1st, then at that time they will be migrating you into these new Affordable Care Act Plans, and you’ll get a new renewal and it will be more because why? There are these 10 essential things, and there’s some taxes that are going to be thrown in there by the government because we’re going to be subsidizing many people.

These rates are going to be more, and unless you make, I’ll give you some examples if you make a certain range you’re going to get a higher subsidy versus a lower subsidy, and I’ll share that with you in just a minute.

So if you’re self-employed, is that two minutes? Thank you. Am I over or is it two minutes? I’m talking the table toppers two minutes, how’s that?
Because this is really important. Let me finish. This is really, really important.

If you have a small business where you’re only like a husband and wife, they’re saying, and again this is still not 100% clear, but what they’re saying is if you’re self-employed, meaning you only have your family business, and you don’t have a W2 employee, they’re saying you are no longer qualifying as a group, that you will be moving into the individual exchange market, because you don’t have a W2 employee. But there are people do have W2 and they’re all family, so there’s still some clarity that needs to be shed on that. My understanding is if it’s a husband and wife, you’re no longer going to be able to do a group. You’re going to go into the individual exchange.

We’ll help you determine that if you want to go off exchange, on exchange, they have what they call Mirrored Plans on the exchange where, I know this sounds like a whole bunch of gobbledy goop, I understand that. Just come.

Let me give you a couple of examples. Let’s say you want to go on the silver plan. That’s probably going to be, and I’ll pass these around, these are just some of the standard benefits. I didn’t want to give it to you while I was speaking because it is distracting, but you can just look at this, and see what the basic parameters are going to be, and they have wiggle room with about two percent of what they’re going to charge, higher, lower and that kind of thing. But if you look at a family of four, age 40 with two kids, and they make about $50,000, the premiums are anywhere from about $500 to almost $700 per month, but they’re going to get tax credit of about $300. So that makes it, you know you apply that and then if it’s a $500 premium you get $300 credit, you’re going to pay $200 right? If you choose the more rich plan, the platinum plan, it might be you know $800 a month and you still get that same $300 tax credit, and you’ll pay $500.

Let’s say you make $65,000 a year, but this is family combined income, you might pay from $650 to $750 and you’re going to get a tax credit of about $387.00. This number moves all depending upon what your income is, how many people in your family, and all different variables. If you make $85,000, you might pay $761 up to a $1000. That’s a stiff premium, isn’t it? This is a silver premium. This is a silver plan. These silver plans are probably going to be the most popular plans because they’re still affordable and they have a low deductible. Your tax credit on that would be about $200 a month.

If you make $94,200.00, what kind of tax credit are you going to get?

Business Growth Innovators Member: Zero.

Crystal: Yeah, you listened! You don’t get anything. That means combined income. The challenge in California we make higher incomes then the rest of the country.

Business Growth Innovators Member:  We do?

Crystal: Well most, if you have combined families working, we make more than most of the country. The cost of living is higher. It’s going to be interesting. All I can say to you is there’s a lot here I know, and I hope it was helpful to you. I brought lots of my cards. I would love to help you find your way through this, and we’ll help you find the best options, so you can save money. That’s the goal. Okay?

So hopefully, do you have a question? Anybody? Quickly? I don’t have time. If you have a question, see me afterwards. The main thing is please take my card, refer me people that need help. I’m here to help them. Okay? Thank you.

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