What Providers Need to Know

Health care reform changes

If you’re an HMSA participating provider, health care reform will change your patients’ health plan. Here’s what you need to know.

For health care reform information as a business owner, see the small business (up to 50 employees) or large business (more than 50 employees) section.

What you can expect

You could see more patients starting in 2014. That’s because health care reform requires almost everyone to have health care coverage or risk paying a fine to the Internal Revenue Service. People who don’t get coverage through their employer or government assistance, such as Medicare or QUEST, will have to buy insurance on their own. And there’s good news for people who were denied coverage in the past because of a serious health condition. They can now get insurance even if they have asthma, cancer, diabetes, or other chronic conditions.

Options to buy coverage

People who don’t have health insurance will have two options to buy coverage. They can:

  • Contact health plans like HMSA directly, or
  • Buy a health plan from HMSA or another insurer in the Hawai‘i Health Connector, the state’s online health insurance marketplace, starting October 1

Depending on their income, people could get financial help from the government to pay for health insurance in the Connector. Health plans purchased in the Connector are not expected to change provider reimbursements.

Expanded funding for providers

Health care reform is helping place primary care providers (PCPs) in areas that need more doctors. PCPs can receive scholarships and loan repayments for setting up practices in areas that have doctor shortages. Health care reform also provides more primary care and nurse training programs. And PCPs will get more Medicaid and Medicare payments.

Benefits are changing

Benefits will change for patients who have health coverage through a small business (up to 50 employees) or on their own through an individual plan. Starting in 2014, their plans will include 10 essential health benefits:

  1. Ambulance service
  2. Emergency care
  3. Hospitalization
  4. Laboratory services
  5. Maternity and newborn care
  1. Mental health and substance abuse services
  2. Pediatric oral and vision services
  3. Prescription drugs
  4. Rehabilitation and habilitative services
  5. Services for preventive, wellness, and chronic disease management

Premiums are changing

Health plan premiums will change for patients who have coverage through a small business (up to 50 employees) or on their own through an individual plan. Starting in 2014, their premiums will be based on their age and may be adjusted based on their tobacco use. For example, health plans for older patients and patients who smoke may cost more than younger patients and patients who don’t smoke.

Also, the federal government will pay for health care reform changes with new fees and taxes imposed on health insurers nationwide, including HMSA. This will increase health plan premiums.

When to buy health insurance

People who buy an individual health plan on their own can enroll in an HMSA health plan from November 15, 2014, to February 15, 2015. After that time, they can only enroll during a special enrollment period (SEP) if they lose their health insurance due to a divorce, death of a spouse, or loss of a job.

This information is based on HMSA’s review of the Affordable Care Act (ACA). This overview is intended for educational purposes only and should not be used as tax, legal, or compliance advice.

Frequently Asked Questions

What is health care reform?

  • Health care reform is the Affordable Care Act, which was signed into law by President Barack Obama in 2010
  • It is legislation that aims to:
    • Make health care more accessible for all Americans, including the uninsured
    • Make health care more affordable by eventually lowering costs
    • Improve people’s health by increasing the focus on preventive care

What does health care reform do?

  • It adds preventive benefits to health plans at no additional cost to health plan members
  • It adds benefits such as laboratory tests, pediatric oral and vision services, and prescription drugs to health plans for small businesses
  • It allows dependents up to age 26 to stay on their parents’ health plan
  • It provides health care tax credits for eligible small businesses

What is the state health marketplace or marketplace?

  • It is an online marketplace where individuals can go to buy health coverage
  • Large businesses that have employees who do not qualify for employee-sponsored health plans can send those employees to the state health marketplace or directly to HMSA, where we will help them sign up for an individual health plan
  • Here in Hawaii, the marketplace is called the Hawai‘i Health Connector

When will the marketplace open?

The state health marketplace will open on October 1, 2013

When is the open enrollment period for the state marketplace?

Enrollment through the state marketplace will be from October 15, 2013, to March 31, 2014, for the first year. The enrollment period for subsequent years will be October through December.

If I am an employer, do I have to use the state health marketplace?

No. You are not required to send your employees to the state health marketplace. You can work directly with HMSA. If you choose to go through the marketplace, HMSA will still be here to guide you through the process and answer your questions.

What is the benefit of buying a health plan from HMSA?

HMSA can provide a smooth transition to plans that comply with health care reform to avoid disruption of benefits and services. HMSA will personally help people choose health plans based on their health and financial needs. And we’re always here to answer your questions.

What is the benefit of buying a health plan in the marketplace?

Individuals who do not qualify for employer-sponsored health care coverage may qualify for a subsidy if they purchase a health plan through the marketplace. Small businesses may qualify for a tax credit if they have an equivalent of up to 25 full-time employees with average wages of less than $50,000 a year. You should check with your tax adviser. Also, the marketplace will send employers one consolidated bill for employee health plans.

Do I still need to provide health coverage for my employees?

Yes. Hawaii businesses must still comply with the state’s Prepaid Health Care Act. This law requires employers to provide health insurance for employees who work 20 hours or more a week for four weeks in a row (with some exceptions). Employers must contribute at least half of the employee’s dues for single coverage. The employee contributes the rest, but no more than 1.5 percent of their wages.

Will I have to pay more now to cover my employees?

There are several factors that may impact the cost of health plans. The federal government will pay for health care reform with new fees and taxes imposed on health insurers nationwide, including HMSA. This added cost is reflected in your premiums for the upcoming year. Beginning in 2014, health plan rates will be determined by age. This means health plans for younger individuals may cost less and health plans for older individuals may cost more. Tobacco use and added benefits required by health care reform may impact the cost of health plans.

Will patient out-of-pocket costs change due to health care reform?

HMSA will be offering a variety of plans with a variety of out-of-pocket costs to meet the needs and wants of all Hawaii consumers.

Will there be more preventive benefits added in 2013?

No. The preventive benefits required by the Affordable Care Act have all been added.

Will these changes affect my pay-for-quality payments?

No. Changes due to health care reform will not affect your pay-for-quality payments.

What are the benefits that health plans are now required to have?

All small business and individual health plans renewing in 2014 are required to have the following benefits: prescription drugs, ambulance service, emergency care, hospitalization, laboratory services, maternity and newborn care, mental health and substance abuse services, pediatric oral and vision services, rehabilitation and habilitative services, and services for preventive, wellness, and chronic disease management.

What is the penalty for not having health coverage? How will the government enforce this?

The penalty for not having insurance will either be a flat fee or a percentage of a person’s income, whichever is greater. The penalty will increase each year through 2016. The government will require individuals to show proof of coverage when filing tax returns to the IRS. If there is a penalty, it will be deducted from an individual’s tax refund.

Year Penalty
2014 $95 or 1.0 percent of your income
2015 $325 or 2.0 percent of your income
2016 $695 or 2.5 percent of your income

Will my patients who have pre-existing conditions be able to get health coverage?

Yes. Health care reform will allow more Americans to qualify for health coverage, including individuals who were denied coverage in the past because of a serious health problem.

Where can I go if I have questions?

Call your HMSA representative or call 948-6330 on Oahu or (800) 790-4672 toll-free on the Neighbor Islands. You can also email your questions to Provider Services at PSInquiries@hmsa.com.