As a state with a Republican governor, Pennsylvania was hesitant to implement the Affordable Care Act and immediately refused the option of running its own health insurance exchange. Gov. Tom Corbett stated on Dec. 12, 2012 that “health care reform is too important to be achieved through haphazard planning. Pennsylvania taxpayers and businesses… deserve informed decision making and a strong plan that responsibly uses taxpayer dollars . . . Therefore, I have decided not to pursue a state-based health insurance exchange at this time. It would be irresponsible to put Pennsylvanians on the hook for an unknown amount of money to operate a system under rules that have not been fully written.”
This claim echoed that of several other Red states whose governors rejected the option of a state-run exchange, though plenty of others have stepped up and decided to take on the responsibility. Rather than expanding Medicaid under health reform, Corbett proposed a subsidized, low-income insurance alternative to reduce the number of uninsured Pennsylvanians, called Healthy PA. The Centers for Medicare and Medicaid Services welcomed this idea as a form of Medicaid expansion.
In addition to Medicaid and exchanges, the state’s private health insurance market has changed remarkably. Those who have been members of the high risk pool or simply uninsured due to their conditions are accepted for coverage and shouldn’t have any difficulty enrolling in an insurance plan. The state will have to provide insurance to those it would not cover previously.
ACA Changes to PA Insurance: 2010-2013
Although the largest changes were set for implementation in 2014 and later, the health reform law made a few important alterations in coverage before the exchanges opened. One of the more noticeable differences is in young adult coverage, as 91,000 people in this group gained medical insurance in the first year of the law. Dependents can now stay on their parent’s plan until age 26, which insured 11.7 million adults from age 19-25 between 2010-2012 throughout the country.
Free preventive care is another key difference in reformed coverage, permitting policyholders to receive recommended services through their health plan’s network without copays, coinsurance, or deductibles. More preventive services have also been approved since the law was passed, including contraceptive coverage, cancer screenings, and prenatal tests. Anyone with a private health plan can now access these services for free.
Lifetime and annual benefit limits were changed, not allowing insurers to hold back anyone from receiving important types of care. Lifetime maximums on essential health benefits have been removed from all health plans, and annual limits on essential health benefits were gradually phased out, set at $2 million for 2013, until 2014 when no annual limits are allowed on essential health benefits. This applies to all private plans, both group and individual.
Insurers are also required to spend more of their premium revenues on healthcare by following the medical loss ratio (MLR). This portion of the law provides refund checks to policyholders whose plans did not spend 80-85 percent of their income accordingly.
Pennsylvania Health Reform in 2014
Residents of Pennsylvania can enroll in any individual health plan they choose starting January 1, 2014, or earlier based on open enrollment in the exchanges. Additionally, everyone will be required to enroll in some form of coverage or else pay a penalty tax through the individual mandate. All insurers will have to accept people with medical conditions and give them fair access to coverage — with no elimination riders or exclusions. Premiums cannot be increased based on gender or health, but will only be adjusted for age, location and tobacco use. Premiums also still vary between carriers and the coverage you choose.
Individual health plans also have to include essential health benefits (EHBs), which include ten categories of services, such as maternity and newborn, hospital, emergency, and prescriptions.
More health insurance options are available to those who can’t afford an individual plan purchased directly from an insurer through the Pennsylvania health insurance exchange. Although Gov. Corbett declined to set one up as a state, the federal government runs the insurance marketplace for Pennsylvania. These health plans are ideal for lower-income individuals, as tax credits are available to reduce premiums and cost sharing. Those who earn between 100 and 400 percent of the poverty guideline may qualify for subsidies to cover a portion of premiums, and earners who make between 100 and 250 percent of FPL may be able to reduce their out-of-pocket costs. Like individual health plans, these plans are each qualified health plans that include a set of EHBs and provide comprehensive coverage.
Medicaid may expand in Pennsylvania in coming years through Corbett’s Healthy Pennsylvania plan, which means that an additional group would be eligible for low-cost health insurance. His plan includes low monthly premiums for Medicaid-style coverage as long as low-income people are looking actively for work or are employed.
1. Huffington Post. Obamacare: Pennsylvania Governor Rejects Health Insurance Exchange.
2. Post Gazette. Growing evidence: Corbett should heed the Pa. Reports on Medicaid.