The Affordable Care Act’s implementation has been experimental and haphazard, but the law has still ultimately changed many regulations for resident of Michigan. Although the state initially intended to set up the state health insurance exchange as a nonprofit called MI Health Marketplace, the governor eventually decided to partner with the federal government. As time was running out before October 2013 when the exchanges were due to open, Gov. Rick Snyder thought it would be wise to team up with the feds in order to create a functional program. This left the responsibilities of plan management and consumer assistance to the state of Michigan and all other management tasks to the federal government.
Medicaid expansion legislation passed in Michigan, allowing a new eligibility group to the Medicaid program that could insure an additional 450,000 residents. Adults without children are now permitted to enroll in the public health insurance program with income up to 138 percent of poverty. Parents who previously needed extremely low income to qualify can also apply if they earn up to the ACA-established threshold.
The majority of the law known as Obamacare takes effect in 2014 and 2015, yet the Affordable Care Act has already made its mark on Michigan health insurance. Michigan residents have access to more services, and insurers in the state are required to provide better quality coverage. Significant changes have been made to medical care and insurance as the law was implemented, and here are a few highlights that most largely impact Michigan health insurance policyholders.
Obamacare in Michigan: 2010-2013
Changes to health insurance in the ACA’s “transitional period” include updates to preventive care services, requiring insurers to cover more types of care and pay for them in full for certain policyholders. When using an in-network provider, no insurer can charge you for services which have been suggested by your doctor and the HHS. These include immunizations, age and gender-appropriate cancer screenings, and contraceptives, a new addition to the list since 2012.
Insurers in Michigan must also spend their income generated from their members wisely, as they are regulated by the medical loss ratio (MLR). This provision states every health plan must spend no more than 15-25 percent of premium income on internal costs, leaving the rest to improving services for policyholders. Additionally, insurers are unable to place a limit on lifetime benefits, now that all maximums have been eliminated. Annual benefit limits have been increased gradually, currently at $2 million, and was phased out completely by 2014.
Dependent children up to age 26 in Michigan have been able to stay on their parent’s health plan, which assisted 94,000 young adults in 2011. Throughout the country, this portion of the law has helped 11.7 million people stay insured compared to before the law’s inception.
Michigan Health Reform: 2014 and Later
Michigan provides its residents with nondiscriminatory coverage through every single health plan in the state beginning January 1, 2014. Medical insurers are unable to decline anyone for coverage for health reasons, and are also more limited in their underwriting processes. Health insurers cannot increase premiums for pre-existing conditions, gender, or occupation, and only increase rates based on age, location, and tobacco use. Rates also continue to vary between carriers and policies. Michigan health plans offer a wider range of benefits, including a minimum of ten categories of Essential Health Benefits (EHBs) certain plans must cover on and off the exchange.
The Michigan insurance exchange, available through HealthCare.gov, began its first open enrollment on October 1, 2013, allowing individuals who couldn’t afford coverage through a private insurer and earn too much to qualify for Medicaid to get insured. These health plans cover each category of essential health benefits and are subsidized for enrollees with income between 138-400 percent FPL to reduce premium costs. Premium and cost sharing tax credits are awarded to individuals who sign up for marketplace plans. The Michigan exchange is an online marketplace for health insurers to sell subsidy-eligible qualified health plans under the ACA. You can also receive information about Medicaid through the exchange, as you may qualify for coverage through this public health program.
Because health insurance is mandatory beginning in 2014, all residents are encouraged to find a health plan that meets their needs through the marketplace, outside the marketplace, or in the newly expanded Medicaid program. The individual mandate allows the IRS to tax you for being uninsured when filling out your federal return each year. In order to avoid this penalty, you can sign up for Medicaid, Medicare, or other government plans, get coverage through work, or buy an individual plan. Any form of creditable coverage, or minimum essential coverage under the ACA, is acceptable to evade the tax. Minimum essential coverage pays at least 60 percent of a policyholder’s total covered costs, but benefits can vary.
1. Kaiser Health Reform. State Exchange Profiles: Michigan.
2. Healthcare.gov. How the Healthcare law is Making A Difference for the People of Michigan.