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High court ruling means big health care changes

Last week's Supreme Court ruling cleared the path for the enactment of President Barack Obama's health care law, but it isn't the final word on health care reform in New York, officials and experts say.

The state has many obstacles to overcome as it implements the Affordable Care Act -- not the least of which is construction of an online marketplace or "exchange," where uninsured New Yorkers will be required to buy insurance. One million New Yorkers are expected to use the marketplace.

State Sen. Kemp Hannon (R-Garden City), the chairman of the Senate health committee, said New York still needs to tell insurers how to construct the plans they will offer on the exchange and what they must offer.

There is also the question, Hannon said, of how the state will identify people required to buy insurance on the exchange.

"What remains are some enormously complex questions about how the exchange will function, what the rules are, who can participate," Hannon said.

People must be hired to run the exchange behind the scenes, and walk-in offices must be readied for those who don't want to, or can't buy their insurance online or who need help.

 

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Coverage of 1 million more

Gwen O'Shea, president of the Health and Welfare Council of Long Island, a social services group, said: "Right now, we have a lot of work to do implementing the Affordable Care Act in an effective way so we can get 1 million more people covered as soon as possible."

In addition, the state faces a push from Assemb. Richard Gottfried (D-Manhattan) to create a state-run health coverage plan that would replace traditional health insurance.

Gottfried, chairman of the Assembly health committee, first introduced the bill 20 years ago but has never had enough votes to pass it. State Sen. Thomas Duane (D-Manhattan) is the bill's Senate sponsor.

Now, with the momentum of health reform behind him, Gottfried says the time is right to pursue a state-run health care coverage system that he says would cut costs.

"We've been and will continue to work to bring on board health care professionals and labor unions and my major goals over the next months will be to interest Governor Cuomo," Gottfried said.

Gov. Andrew M. Cuomo's office had no comment.

Under Gottfried's bill, the state -- instead of insurance companies -- would pay for health care for New Yorkers. Payroll deductions would help finance the plan and people would continue to use their own doctors and hospitals. The federal money New York will receive for health care reform under the Affordable Care Act could also be used to finance the system, Gottfried said.

The Vermont Legislature passed a law to establish a similar system there by 2017.

Plans like Gottfried's are sometimes called "single payer" systems because one government entity pays the bills instead of many insurance companies. The plan would operate somewhat like Medicare.

 

Less interference seen

Dr. Edward Lewis, president of an upstate chapter of the American Academy of Pediatrics, said Gottfried's bill "removes insurers from the patient-physician interaction. No longer would they be interfering."

O'Shea said she personally thinks the Affordable Care Act "is not the be all and the end all" and that Gottfried's plan is worth pursuing.

Leslie Moran, spokeswoman for the New York Health Plan Association, which represents the insurance industry, said the group opposes Gottfried's bill.

"We don't believe that single-payer is a solution to our coverage needs in New York or nationally," Moran said.

Michael Dowling, chief executive of the North Shore-Long Island Jewish Health System, added, "What you don't want is to get health care centrally controlled by government, where everything is micromanaged."

Hannon also opposes state-run health coverage.

"I have not seen the government administer a benefit system in an efficient and fair way," Hannon said, referring to Gottfried's bill.

Hannon said the state should concentrate on implementing the Affordable Care Act.

"I think it's an enormously complex process that will be difficult to do on time," Hannon said.

Under the federal health care reform law upheld last week, New York must have an online marketplace up and running by Jan. 1, 2014.

The law requires uninsured people to use the exchange to buy insurance from a menu of plans. "I think there will have to be conversations about how to treat this and make it work," O'Shea said.

With Ridgely Ochs

The law explained: Q&A

 

Who is affected by the mandate and will have to get health insurance?

Anyone who does NOT already have health insurance either through an employer, Medicare, Medicaid or the Children's Health Insurance Program, TRICARE (for service members, retirees, and their families), the veteran's health program, private insurance purchased on your own; or a grandfathered health plan in existence before the health reform law was enacted.

Are any other people exempted?

The following groups: Anyone in a religion opposed to benefits from a health insurance policy; undocumented immigrants; those incarcerated; members of an Indian tribe; if your income is below the threshold requiring you to file a tax return ($9,350 for an individual, $18,700 for a family in 2010); or if you would have to pay more than 8 percent of your income for health insurance after taking into account any employer contributions or tax credits.

How many uninsured people may get insurance because of the act?

In New York, 2.7 million -- 275,000 of them on Long Island -- are uninsured. The state expects about 1 million people, 600,000 as individuals and 400,000 through small-business owners, to enroll in the soon-to-be established insurance exchange.

What are the penalties if I choose not to get insurance?

In 2014, when insurance exchanges are set to begin, the penalty is $95 per adult and $47.50 per child, up to $285 for a family, or 1 percent of family income, whichever is greater. In 2015, the penalty is $325 per adult and $162.50 per child, up to $975 for a family, or 2 percent of family income, whichever is greater. By 2016 and after the penalty is $695 per adult and $347.50 per child, up to $2,085 for a family, or 2.5 percent of family income, whichever is greater.

How will I get insurance if I already don't have it?

On April 12, Gov. Andrew M. Cuomo issued an executive order to establish a statewide health insurance exchange. The exchange will let individuals and small businesses comparison shop for insurance. By 2014, if your employer doesn't offer insurance or you don't already have it, you will be able to buy it from the insurance exchange.

How will the exchange work?

The exchange will offer four levels of insurance at prices below those available on the open market. Consumers will be able to choose from plans that will cover as little as 60 percent and as much as 90 percent of their medical costs. People who use the exchange can go to a website, use a toll-free number or go to designated offices to choose their insurance options.

Will I save money?

The average premium for an individual who gets coverage directly from the exchange, not through their employer, is expected to decline by about 70 percent. For example, a family of three who earns $24,352-$27,465 annually will have a maximum premium cost of $730-$1,098 and a maximum annual co-pay/deductible of $3,867.

What if I can't afford a health plan?

Medicaid, the government health insurance for the low income and disabled, is being expanded beginning in 2014. Adults would be eligible if their annual incomes don't exceed about $14,000 for individuals and $29,000 for a family of four.

What if I don't qualify for Medicaid but still can't afford a plan?

You could be eligible for a government subsidy in 2014. Subsidies would be available for individuals with incomes up to about $43,000 and $88,000 for a family of four.

I have a small business. Do I have to offer insurance?

If you have fewer than 50 employees, you face no penalties if you do not offer insurance. Until 2013, employers with fewer than 25 employees and average annual wages of less than $50,000 who offer health insurance coverage to their workers can get a tax credit up to 35 percent of the cost of the premiums. That will reach 50 percent by 2014. The average single premium for small-businesses purchasing through the exchange is expected to be about 21 percent lower than the average single premium in the current small-employer market, excluding Healthy New York.

What about businesses with 50 or more employees?

By 2014, those businesses that don't offer coverage to their employees will have to pay an assessment for employees who get their insurance through an exchange.

Sources: healthcare.gov; healthcarereform.ny.gov; New York State Department of Health; New York State Department of Financial Services; Kaiser Family Foundation

-- Ridgely Ochs

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