Health Insurance and Obamacare for Beginners: What Has Changed?

I’m not a health insurance expert, but given that the Affordable Care Act or Obamacare has been dominating insurance conversation and given that I’ve gotten some feedback from readers on it, I thought I should address some basics.

A lot has changed, and I’ll only be touching on a tip of the tip of the iceberg, but hopefully you’ll have some clarity on the broad brushstrokes so you can work on your own health coverage with a little more knowledge than before.

In this post, I’ll talk about some of the major changes regarding who has is required to purchase coverage and what happens if you don’t.

In the next post, I’ll discuss the basic options for individuals who need to procure coverage.

Finally, I’ll offer a little 101 course in reading your insurance quote terminology. I will not tell you what you need to buy, but I’ll help you decipher HMO from PPO and translate the other line items you’ll find when you get a quote indication on healthcare.gov.

Photo Credit: Yung $hawty via Compfight cc

Photo Credit: Yung $hawty via Compfight cc

Basic Changes: Requiring Corporations to Provide Coverage

Corporations of 50 or more employees will be required to offer health coverage for their employees.The details can be found elsewhere, but that is the gist. The penalties for noncompliance will start in 2015.

Basic Changes: Requiring Individuals to Purchase Insurance

Individuals will now be required to carry health insurance or face a monetary penalty.  I won’t go into details regarding the penalty since I honestly don’t know a lot about how that will work.

The main point is that individuals need to think about it now where they might not have had to in the past.

This requirement will affect quite a few smaller nonprofits, especially those who hire young professionals who might have gone without coverage in the past. Whereas the nonprofit itself (assuming fewer than 50 employees) will not be required to carry coverage, the individuals who make up the staff will have to find coverage.

Previously, this line item on a young, just-out-of-college professional’s budget was optional. Now it is not optional.

As a result, will small nonprofits feel pressure to help subsidize employees’ individual health plans?

Regardless, the Affordable Care Act requires conversations around salary and compensation that weren’t necessary before the Act. No judgement on whether this is a good thing or not. It simply is what it is.

The Upshot

The biggest takeaway is that if you are an employee or leader of a smaller organization, you’ll need to account for individual health insurance one way or another.

If you’ve had typical corporate insurance before, you’ve trusted human resources professionals to clarify the coverage options. If you’ve never had health insurance on your own, it’s a little nerve-wracking to engage an agent or navigate the information on the healthcare.gov website.

Hopefully, through this post and the next two, you’ll feel a little more equipped to take on the process.

Questions:

  • What, if any, part of the Obamacare legislation has you confused?
  • Have you had to review health insurance quotes before?
  • Please leave any questions you have in the comments. If I don’t know the answer, I’ll work to help find the answer for you.

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