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Affordable Care ActMarketplace Subsidies
in Alaska
Presented by Patricia Atkinson
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BackgroundAuthorized by the Patient Protection and Affordable
Care Act of 2010;Health insurance subsidies for individuals and
families between 100% and 400% FPL, who do not have access to affordable coverage through their employer or government agency;
Subsidies available January 1, 2014;Purpose is to make health insurance more affordable.
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Types of Subsidies Available1. Monthly premium tax credit:
For families between 100% and 400% FPL;Family pays portion of monthly premium, based on
family income;Calculated as a percentage of income, from 2 – 9.5%
depending on FPL;May be paid by federal government directly to
insurance plan;Or, family may pay full premium and receive tax credit
when they file income tax return.
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Types of Subsidies Available
2. Cost Sharing Assistance: For families between 100% and 250% FPL; Limits out-of-pocket costs for deductibles,
coinsurance, and copays; Subsidies decrease as family income increases.
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Coverage GapFor non-disabled adults who do not have dependent
children at home, who are below 100% FPL, there are no subsidies available.
About 32,000 Alaskans fall into this category.
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Coverage GapOptions are very limited for these low-income adults:– pay out-of-pocket for their care;– purchase health insurance at full price;– obtain primary care services at a sliding discount if they
live in a community with a community health center;– rely on charity care from local hospitals if they live in a
community with a hospital that offers charity care;– go without health care services.
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Table 1 – Income and Subsidies: 100% FPL
100% FPL Required Monthly
Contribution from Enrollee
Maximum Annual Out-of-Pocket
Family Size Hourly Monthly Annual
1 $6.90 $1,196 $14,350 $24 $2,250 2 $9.32 $1,615 $19,380 $32 $4,500 3 $11.74 $2,034 $24,410 $41 $4,500 4 $14.15 $2,453 $29,440 $49 $4,500 5 $16.57 $2,873 $34,470 $57 $4,500 6 $18.99 $3,292 $39,500 $66 $4,500
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Table 1: Income and Subsidies – 400% FPL
400% FPL Required Monthly
Contribution from
Enrollee
Maximum Annual Out-of-Pocket
Family Size Hourly
Monthly Annual
1 $27.60 $4,783 $57,400 $454 $6,350 2 $37.27 $6,460 $77,520 $614 $12,700 3 $46.94 $8,137 $97,640 $773 $12,700 4 $56.62 $9,813 $117,760 $932 $12,700 5 $66.29 $11,490 $137,880 $1,092 $12,700 6 $75.96 $13,167 $158,000 $1,251 $12,700
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Qualified Health PlansMust cover essential health benefits;Limit cost sharing (deductibles and copays);Satisfy other consumer protections under the ACA;Two companies in Alaska authorized to sell through
the Marketplace - Premera and Moda;Bronze, Silver, and Gold policies represent the
actuarial values (amount of cost sharing);Premium subsidies are based on second lowest cost
silver plan.
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Table 2 – Young Families –Premera Plans Bronze Silver Silver Gold Selected Plan Characteristics-In Network Plus Plus HSA Select Select Deductible for Individual $6,350 $2,500 $2,000 $1,000 Maximum Deductible for Family $12,700 $5,000 $4,000 $2,000 Primary Care Coinsurance or Copay 0% 20% 20% 20%Out-of-pocket Max Per Individual $6,350 $4,500 $6,350 $5,000 Out-of-pocket Max Per Family $12,700 $9,000 $12,700 $10,000
Sample Non-Smoker Monthly Premiums by Family Size and AgesFamily Size (Ages) 1 (28) $324 $368 $431 $453 2 (24 + 26) $603 $686 $780 $842 3 (28 + 29 + 6) $846 $962 $1,095 $1,183 4 (29 + 10 + 5 + 2) $900 $1,024 $1,166 $1,258 5 (32 + 29 + 8 + 4 + 1 ) $1,252 $1,425 $1,622 $1,751 6 (37 + 35 + 16 + 13 + 11 + 5) $1,300 $1,478 $1,683 $1,816
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Table 3 – Older Families – Premera Plans
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Table 4: Effect on Premium by Medicaid
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Cost Sharing AssistanceTable 7 - Max Out of Pocket
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Alaska Native/American IndiansMust apply for exemption if desired;
If choose to purchase health insurance, no
cost sharing if income under 300% FPL;
Special monthly enrollment periods available.
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ExamplesPremium subsidies calculated using Premera
Plus Silver HSA policy for non smokers; Premera Area 1 (zip codes 995xx);Out of pocket costs based on in-network
health care only;Families may choose different policy or be
located in different area, which could influence amount of subsidy.
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Dick and Jane• Dick and Jane are 58 and 62, and their income
is 300% FPL ($58,140). • They can purchase a silver policy in the
Marketplace for $1,836 per month. • They will pay $460 per month for the
premium, and receive a monthly tax credit of $1,376.
• They will not receive subsidies for their annual out-of-pocket costs.
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Joe, Mary, and Brittany• Joe is 28 years old, Mary is 29, they have a 6 year old
daughter Brittany. • Their income is 200% FPL ($48,820.)• Brittany is eligible for Denali Kid Care. • Joe and Mary can purchase a silver policy for $747 per month
to cover themselves only. • They will pay $256 per month (6.3% of their income) and the
premium tax credit, which can be paid directly to the insurer monthly, will be $491 per month.
• Their annual out-of-pocket costs are capped at $4,500 for the family.
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Karen and Kevin• Karen, age 45, and Kevin, age 47, are an Alaska Native family with three
children. • Their annual income is 250% FPL ($86,175), and they do not currently
have health insurance.• The family receives health care services through the Tribal health system. • They decide to apply for health insurance through the Marketplace,
although they could apply for an exemption. • They choose the least expensive bronze plan, $1,191 per month. Their tax
credit is calculated by subtracting the required monthly contribution based on their income ($578) from the second lowest cost silver plan in the area ($1,664) for their specific family member ages.
• They are eligible for a tax credit of $1,086 per month, so they will pay $105 per month for their premium ($1,191 - $1,086).
• They will also not pay for any copay, deductible, or other out-of-pocket expense.
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Brianne• Brianne is a single mother, 29 years old, with three
children. • Annual income is 175% FPL ($51,520). • Children are on Denali KidCare, Brianne is uninsured. • Silver plan just for herself is $379 per month. • Tax credit is based on family of four, so she will pay
$221 per month (5.15% of her income), and receive a tax credit of $158.
• Her out-of-pocket costs are also limited to an annual family maximum of $4,500.
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Chuck, Julie, and Robert• Chuck is 57, Julie is 56, Robert is 18. Chuck and Robert are
Alaska Native, Julie is non-Native. • Annual income is 138% FPL ($33,686), so Robert is eligible for
Medicaid. • Chuck and Robert receive health care through the Tribal
health system, but Julie is uninsured and must purchase a plan to avoid a tax penalty.
• They would pay 3.29% of their income or $92 per month for the policy, and receive a maximum tax credit of $1,524.
• They could purchase a silver plan for Julie for $790 and a bronze plan for Chuck for $726.
• $790 + $726 = $1516, tax credit is $1516 per month. • Maximum out-of-pocket is $2,250 for Julie.
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AppendicesAppendix 1: Calculations of premium contributions
and max out-of-pocket by FPL Note: mixing 2013 FPL with 2014 subsidies
Appendix 2: Sample plans and premiums for younger and older families.
Apendix 3: Examples of family income, premium price, family contribution, tax credit, and max out of pocket by FPL.
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Helpful Resourceswww.healthcare.govhttp://kff.org/interactive/subsidy-calculator/ (you
can also access frequently asked questions from this page)
https://www.premera.com/ak/visitor/https://www.modahealth.com/http://www.healthreformbeyondthebasics.org/http://www.hhs.gov/healthcare/facts/factsheets/201
1/03/americanindianhealth03212011a.html