So really – what is a health insurance exchange?
Health Insurance Exchanges are a creation of President Obama’s Affordable Care Act. While not themselves insurance companies or creations of insurance companies they are where uninsured Americans can go to find health insurance; basically clearing houses. The act mandates that the population of each State must have access to an Exchange. If a State does not create an exchange entity then it must use the federal governments. Locally Minnesota has developed its own called MN Sure while both of the Dakotas have elected to use the federal governments. The fundamental is that every State will not be the same so rules that may apply in one State will not apply in others. Members heard Rotarian and Saint Francis Health Care Campus CEO David Nelson explain the basics of health insurance exchanges during their regular noon hour meeting at Prante’s on Tuesday, September 3, 2013.
The Exchange idea was designed for small businesses with fifty or less full time equivalents (FTE). Companies with more than 50 FTEs live under another set of rules with different paperwork and harsher penalties for noncompliance. In Minnesota Medicaid and MN Care will go through the exchange, MN Sure. By 2016 it is estimated that 1.3 million Minnesotans will obtain their coverage through MN Sure. On the North Dakota side it is believed to be a half million people. Who can go through an exchange and who must purchase insurance directly from insurance companies is based upon income. By 2015 there will also be available in every State a multi-state plan selected by the Federal Office of Personnel Management.
Purchasing their obligatory health insurance through an exchange is the only way an individual can qualify for Federal premium subsidy tax credits. It should be noted that while many do not know of or understand exchanges many are also unaware that by law they must purchase health insurance and failure to do so will result in a monetary penalty being assessed. By 2017 the penalty in dollars will equal the cost of the insurance.
MN Sure will also offer a MN Sure Plus plan that will have five levels with escalating premiums. The basic Catastrophic Insurance that likely will be purchased by people under 30; Bronze level that will cover 60 % of costs; Silver 70 %; Gold 80 % and Platinum 90 %.