The Georgia Office of Insurance continues to play the lead role in the move toward implementing insurance exchanges to bring Georgia into compliance with the federal guidelines as it relates to health care coverage under the Affordable Care Act (ACA.)

Georgia will not establish its own exchange opting instead to let the federal government set up and operate Georgia’s Exchange. As states move forward, there are three options for establishing an exchange:

State-run facilitator model: Any carrier meeting minimum federal and state requirements set for the health insurance exchanges can be in this exchange. Carriers compete in an open market.

State-run active purchaser model: The state solicits bids from health insurance companies and determines which plans it will offer. The state directly negotiates the price and benefits offered.

Federally run model: The U.S. Department of Health and Human Services (HHS) runs the exchange in states that choose not to create one.  

Georgia has opted to use the federally run exchange model. The insurance exchanges are geared to sell insurance to individuals and small businesses. Renard Murray is the regional administrator for the Centers for Medicare and Medicaid Services (CMS) in both the Atlanta and Dallas (Texas) regions. According to Georgia Health News, Mr. Murray will be in charge of the federally run insurance marketplace in Georgia and six other states in the Southeast. This means that Mr. Murray will be responsible for open enrollment, quality, and its operational components. CMS will be partnering with the Georgia Department of Labor and the Department of Education to help inform eligible individuals of the availability of health care coverage through the Atlanta Regional Exchange.

Exchange plans will be offered in a tiered format: Bronze (60 percent coverage), Silver (70 percent coverage), Gold (80 percent coverage), and Platinum (90 percent coverage). Each tier will have several plans to choose from and will include essential health benefits. Bronze plans will have the lowest monthly premium, but patient cost sharing (deductibles/co-pays) will be more when health care services are provided.  Platinum plans will have the highest monthly premium, but cost sharing will be less.  

All plans must include “essential health benefits” as defined by the health care reform law.  Specifically, the plans must include items and services from at least these 10 categories of care:

1. Ambulatory patient services
2. Emergency Services
3. Hospitalization
4. Maternity and newborn care
5. Mental health and substance use disorder services, including behavioral health
6. Prescription drugs
7. Rehabilitative and habilitative services and devices
8. Laboratory services
9. Preventive and wellness services and chronic disease management
10.  Pediatric services, including oral and vision care*

*It should be noted that because the federal government allows stand-alone dental plans to participate in the exchanges, oral health care coverage becomes a mandatory offering rather than a mandatory purchase. Oral health coverage will be the only essential health benefit that will not be required to be included in a medical policy since exchanges will sell a stand-alone dental policy.  

All health plans must follow new coverage and benefit rules starting in 2014. These requirements are based on: (1) If the plan is offered on or off the exchange; (2) If the plan is fully insured or self-insured; and (3) Group Size. Premiums for the individual and small group plans sold on the exchanges will not be based on health status; instead they will be based on family tier, age, geography, and tobacco use. These plans must also use “3 to 1” age bands, which means the highest premium cannot be more than three times the lowest premium for the same plan. These requirements will no doubt have a significant impact on rates.  Many believe everyone will pay more for the new coverage than they would have for comparable coverage pre-ACA, since the lowest amount has to be in ratio to the highest premium for older adults.

Individuals with incomes less than 400 percent of the federal poverty level will qualify for a government subsidy (credit) to help pay for health care premiums. A report from Families USA found that most Georgians eligible for credits are in working families and have incomes between two and four times the federal poverty level, or about $47,100 to $94,200. Small businesses with 25 or fewer employees whose individual income is $50,000 or less will be eligible for a $10,000 tax credit if they pay 50 percent of the health care premium for their employees.  The credit will only be available for two years.

Seven health insurers have signed up to offer benefits plans in the online insurance exchange that will begin enrolling Georgians in October: Aetna, Alliant, Blue Cross and Blue Shield of Georgia, Coventry, Humana, Kaiser-Foundation Health Plan, and Peach State.

One thing is for certain. Eventually all health care plans will be impacted by the ACA. Only history will tell whether everyone reaches the intended goal of all U.S. citizens being covered under a medical insurance product. The bigger issue may be what the actual delivery system will look like and how easy it will be to access care. Georgia’s Office of Insurance will be very busy over the next few years as the actual implementation process begins.