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ObamaCare - The Winners and Losers

February 6, 2014
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ObamaCare is controversial.

Whether you love it or hate it probably depends on how it personally impacts you and your business.

So, who are the winners and losers?obamacare_winners_and_losers

A recent article by bankrate.com proposed the top ObamaCare winners and losers. Here's a summary of their list, with a few notes of my own. 

ObamaCare Winners

 #1) Consumers eligible for discounts on health insurance

For those consumers eligible, the premium tax credits provide significant cost savings on health insurance. In the past, many consumers were excluded from having health insurance because of the cost and/or pre-existing medical conditions. For these consumers, ObamaCare is a big win. Consumers are eligible for the premium tax credits if they make up to 400% of the federal poverty level (that's about $46,000/year for an individual in 2013). 

#2) Consumers with a pre-existing condition

One of the biggest changes under ObamaCare is that insurance companies are no longer allowed to deny coverage or charge a higher premium because the consumer has a pre-existing health condition. In the past, many people have "worked for health benefits" because they had a health condition that made them uninsurable on the individual market.

Now, consumers with pre-existing health conditions cannot be denied coverge and pay the same as a healthy peer (same age, location, income, etc).

#3) Consumers gaining employer coverage

Under ObamaCare, all employers with 50 or more employees are required to either offer health insurance or be subject to the employer shared responsibility fee. Although the "employer mandate" has been delayed to 2015, employers are already started to prepare by offering health insurance now.

To this point, I'd add that small employers are also becoming more exposed health benefit alternatives such as defined contribution plans. Under this type of arrangement, employees receive monthly allowances to spend on health insurance. This is a popular approach for employers not subject to the employer mandate.

With either approach (defined contribution or traditional health benefits), it means more employees are receiving access to and assistance with health insurance - a big win for these consumers.

#4) Consumers newly Medicaid-eligible

One of the less talked about ObamaCare provisions is Medicaid expansion. Medicaid, the government health insurance program for low-income Americans, is being expanded in 25 states and D.C. In these states, Medicaid eligibility now includes all adults under the age of 65 with household income lower than approximately $16,000 (individual) or $32,500 (family of four). Medicaid expansion particularly benefits childless adults, who in more than 40 states previously could not qualify for Medicaid regardless of their income level. It also benefits low income parents, who previously in more than 30 states did not qualify even if their children did.

ObamaCare Losers

#1) Consumers with a canceled health plan plan

Consumers with an individual health plan that fit their medical and financial needs were caught off guard when they received a letter from their insurance company saying their plan was canceled because it did not meet the new health reform standards. Consumers with canceled health plans who make too much to qualify for the premium tax credits are feeling the pain. According to bankrate.com, these are the young, healthy consumers with higher incomes who are now facing higher premiums and higher deductibles. Some states are allowing the reinstatement of canceled plans as allowed by the administration, but some states are not.

#2) Consumers with an out-of-network doctor

Need to see a specific doctor at a specific clinic? Some consumers are searching exchange plans to find their preferred doctor is not included in the plan's network of providers. 

#3) Consumers with "Cadillac" health plans

The health care law includes a 40% tax on "Cadillac" health plans, which are defined as costing more than $10,200 annually for an individual or more than $27,500 a year for a family. The tax doesn't kick in until 2018, but employers are already beginning to modify health plans to avoid this tax.

#4) Low-Income consumers in states without Medicaid expansion

Medicaid expansion was intended to occur nationwide, but it was effectively made a state option by a 2012 Supreme Court decision. At this time, 25 states and DC are expanding eligibility. In states that do not expand Medicaid, many poor uninsured adults will not gain a new coverage option and will likely remain uninsured. In the states not expanding Medicaid, consumers who earn 100% or less of the federal poverty level (currently $11,490 for an individual) won't qualify for either Medicaid or the premium tax credits on the health exchanges.

Click here to read the article on bankrate.com.

What groups of ObamaCare winners and losers would you add to the list?

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