Exchanges of the Affordable Care Act The internet will have a new kind of online smart shopper. While most compare flights or hotel rates, soon people will be shopping for health insurance. A key component of the Affordable Care Act is the creation of online marketplaces for health insurance, or “online exchanges.� These online exchanges were designed to provide a more efficient way for individuals to purchase insurance by seeking to replicate the manner and format of online travel sites like Kayak.com, Priceline.com, Travelocity.com, Orbitz.com and others. Instead of purchasing hotel reservations, airline flight tickets, or car rental reservations, these online exchanges would allow consumers to shop for the right amount of health insurance at the right price. When the Affordable Care Act was signed into law, states had the right to have a one-time opportunity to opt-in to creating their own exchange or to opt-out into using a federally created and managed exchange. When the Affordable Care Act was passed, most assumed that the states would choose to run their own exchanges. However, twenty states chose to use the federally run exchange. Other states asked to run a hybrid exchange, where the state would be responsible for some parts of the exchange and the federal government would run other parts of the exchange.
The Reasons Why The purpose of these exchanges is to present plans of healthcare benefits to individuals who do not have access to health insurance in any other credible way. If an individual can receive health insurance benefits from their employer, a family member’s employer, or the federal government, they will not be able to purchase insurance from the exchanges or receive any federal subsidies to make the price much lower. The only exception to this is if the individual is offered insurance that is not considered affordable health insurance. If the individual cannot afford the insurance offered to them, the individual is to request a special document from the company affirming that the insurance is offered and how much the premium amounts cost. The individual then accesses the online exchanges, enters into the website their tax information to verify their income, enters the information from the document received from
the employer, and asks the website to process the request. After the request is processed, the website tells the individual whether they are eligible or not.
Eligibility Eligibility is determined by the percentage of that person’s income of what the premium payment will be. If the premium payment is too high of a percentage of that person’s income to exceed the federal guidelines, the individual and all their dependents that they have over 51 percent custody over will be able to purchase insurance from the exchanges. Because of the new healthcare expansion, those states that have opted to expand Medicaid will provide subsidies to those making up to 400 percent of the federal poverty level. For participating states, those who have about $90,000 and have a family of 4 will be eligibility for thousands of dollars of tax rebates, provided the family does not qualify for any other affordable health insurance from any other source. Photo Credit: Kevin Dooley, Mike Bitzenhofer, Ken Teegardin