UPDATED: Aug 20, 2013
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The Washington health insurance pool (officially named the Washington Health Benefit Exchange) is a state-run organization that connects individuals, families and small businesses with health care coverage as per the rules of the Affordable Care Act (ObamaCare). As of 2014, every state is mandated by the federal government to provide health insurance options through an exchange, and the State of Washington has elected to run their own program.
The exchange is a third party system that connects people looking for health care with insurance companies selling policies. Every policy listed through the exchange is highly regulated and must be approved before it can be sold. The policies must meet guidelines set forth by the Affordable Care Act, and each plan is audited to ensure its compliance.
Washington Health Benefit Exchange Plans
The primary plans available for individuals and families are broken down into four different groups – bronze, silver, gold, and platinum. Each metal level has a specific coinsurance percentage assigned to it, and every plan within that level must meet the specified coverage amount. (Coinsurance is the percentage of health costs the insurance company pays for.)
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In addition to the four main categories listed above, Washingtonians under the age of 30 have the option to sign up for a catastrophic insurance plan. Catastrophe plans carry high deductibles and usually mean increased out-of-pocket costs for standard health care procedures, but they provide an umbrella of protection against major health related costs in exchange for lower premiums.
Essential Health Benefits
As part of the Affordable Care Act, insurance companies are required to offer a basic set of coverages for all health care plans sold through the Washington Health Benefit Exchange. These mandatory coverages are referred to as “essential health benefits.”
- Ambulatory patient services
- Emergency services
- Newborn care
- Mental health
- Prescription drugs
- Rehabilitative services and devices
- Laboratory services
- Preventive care
- Pediatric services
Health Care Deductibles
Under the Affordable Care Act, out-of-pocket maximums were established to limit the amount of money an individual must pay per year. That means once an individual has hit their cap, the insurance company is responsible for paying 100% of all future costs for the remainder of the year.
The limit applies to all costs the individual or family may incur, including copays, deductibles and prescription drugs. However, in a last minute change, the Obama Administration delayed part of this restriction regarding out-of-pocket maximums until 2015, so it means some people may have to pay more if they spend a lot prescription drugs as well as health services. For 2014, each of these services will have their own out-of-pocket maximum, but by 2015 these will be combined into one lower maximum.
Washington residents who are unable to obtain health insurance through their employer will be eligible to purchase coverage on the exchange. That extends to people with pre-existing conditions, previously uninsurable, and those that historically have had costly health issues.
People with health care coverage provided through their employer may also be able to purchase a plan on the exchange if their options through work are not deemed “affordable.” Affordable is defined as “below 9.5% of a person’s annual income.” So if the only plans offered through an employer exceed that level, an individual may qualify for the exchange and any subsidies they are eligible for.
The annual enrollment period is between October 1st and March 1st. Individuals, families and small businesses looking for coverage through one of the policies listed on the exchange should be sure to enroll during that timeline. The effective date for new policies is January 1st or as soon as the application is approved, whichever comes later.
For example, if an individual signs up for a policy in November during the open enrollment period, that coverage will take effect on January 1st. If another individual signs up and is approved in February, their policy would take effect at the time of approval.
Tax Subsidies for Low Income
Citizens of Washington that make below a certain threshold will be eligible for federal tax breaks which will go toward paying for health insurance premiums. The thresholds are based on a percentage of the official federal poverty level, and are impacted by how many people are in a family.
The tax subsidies are designed to help individuals and families making under 400 percent of the federal poverty level, and works on a sliding scale. The lower the household income, the more money they will receive from the federal government to offset the insurance premiums. Families making less than 130% of the federal poverty level will more than likely qualify for Medicaid, so their health care will be run through that program.
Washington Small Business Health Insurance
The Washington Health Benefit Exchange is not limited only to individuals and families looking for health insurance. Small business owners can also purchase plans for themselves and employees through the exchange, and benefit from the same comparison features that individuals can use. The plans for small businesses are structured in a similar manner as individual plans, and categorized into the same tiers.
Small Business Tax Credits
Small business owners that obtain heath care for their employees through the exchange may qualify for tax credits to help offset the cost. In order to qualify, employers must:
- Pay a minimum of 50% of the health insurance cost for their employees
- Have fewer than 25 full-time employees or 50 part-time employees
- Pay average wages below $50,000 per year