Applying for Obama Health Care Plan Daunting Task

Applying for benefits under President Barack Obama’s health care overhaul could be as daunting as doing taxes.

The government’s draft application runs 15 pages for a three-person family. An outline of the online version has 21 steps, some with additional questions.

Seven months before the Oct. 1 start of enrollment season for millions of uninsured Americans, the idea that getting health insurance could be as easy as shopping online at Amazon or Travelocity is starting to look like wishful thinking.

At least three major federal agencies, including the IRS, will scrutinize an application. Checking the identity, income and citizenship is supposed to happen in real time, for those applying online.

That’s just the first part of the process, which lets applicants know if they qualify for financial help. The government asks to see what they’re making because Obama’s Affordable Care Act is means-tested, with lower-income people getting the most generous help to pay premiums.

Once an applicant is finished with the money part, actually picking a health plan will require additional steps, plus a basic understanding of insurance jargon.

And it’s a mandate, not a suggestion. The law says virtually all Americans must carry health insurance starting next year, although most will just keep the coverage they now have through their jobs, Medicare or Medicaid.

Some are concerned that a lot of uninsured people will be overwhelmed and simply give up.

“This lengthy draft application will take a considerable amount of time to fill out and will be difficult for many people to be able to complete,” said Ron Pollack, executive director of Families USA, an advocacy group supporting the health care law. “It does not get you to the selection of a plan.”

“When you combine those two processes, it is enormously time consuming and complex,” added Pollack.

He’s calling for the government to simplify the form and, more important, for an army of counselors to help uninsured people navigate the new system. It’s unclear who would pay for these navigators.

Drafts of the paper application and a 60-page description of the online version were quietly posted online by the Health and Human Services Department, seeking feedback from industry and consumer groups. Those materials, along with a recent HHS presentation to insurers, run counter to the vision of simplicity promoted by administration officials.

“We are not just signing up for a dating service here,” said Sam Karp, a vice president of the California HealthCare Foundation, who nonetheless gives the administration high marks for distilling it all into a workable form. Karp was part of an independent group that separately designed a model application.

The government estimates its online application will take a half hour to complete, on average. If you need a break, or have to gather supporting documents, you can save your work and come back later. The paper application is estimated to take an average of 45 minutes.

The new coverage starts next Jan. 1. Uninsured people will apply through new state-based markets, also called exchanges.

Middle-class people will be eligible for tax credits to help pay for private insurance plans, while low-income people will be steered to safety-net programs like Medicaid.

Because of opposition to the health care law in some states, the federal government will run the new insurance markets in about half the states. And states that reject the law’s Medicaid expansion will be left with large numbers of poor people uninsured.

HHS estimates it will receive more than 4.3 million applications for financial assistance in 2014, with online applications accounting for about 80 percent of them. Because families can apply together, the government estimates 16 million people will be served.

Here are some pros and cons on how the system is shaping up:

Pro: Those who apply online are supposed to be able to get near-instantaneous verification of their identity, income, and citizenship or immigration status. An online government clearinghouse called the Data Services Hub will ping Social Security for birth records, IRS for income data and Homeland Security for immigration status. `”That is a brand new thing in the world,” said Karp.

Con: If an applicant’s household income has changed in the past year or so and they want help paying their premiums, they should be prepared to do some extra work. They’re applying for help based on their expected income in 2014. But the latest tax return the IRS would have is for 2012. If they landed a better-paying job, got laid off, or their spouse went back to work, they’ll have to provide added documentation.

Pro: Even with all the complexity, the new system could still end up being simpler than what some people go through now to buy their own insurance. Applicants won’t have to fill out a medical questionnaire, although they do have to answer whether they have a disability. Even if they are disabled, they can still get coverage for the same premium a healthy person of their same age would pay.

Con: If anyone in an applicant’s household is offered health insurance on the job but does not take it, they should be prepared for some particularly head-scratching questions. For example: “What’s the name of the lowest cost self-only health plan the employee listed above could enroll in at this job?”

HHS spokeswoman Erin Shields Britt said in a statement the application is a work in progress, “being refined thanks to public input.”

It will “help people make apples-to-apples comparisons of costs and coverage between health insurance plans and learn whether they can get a break in costs,” she added.

But what if someone just wants to buy health insurance in their state’s exchange, and they’re not interested in getting any help from the government? They’ll still have to fill out an application, but it will be shorter.

By Ricardo Alonso-Zaldivar & Jennifer Agiesta from Insurance Journal.

What You Need to Know About Tax-Related Identity Theft

Many victims of tax-related identity theft uncover the fraud after they have filed their returns, leading to delayed refunds and additional problems with the IRS and Social Security Administration.

“One way to stay ahead of the bad guys is to file your taxes early,” said Vicki Volkert, an IDentity Theft 911 fraud investigator, who has helped many customers resolve their tax fraud woes.

Here are some additional FAQs about tax-related identity theft from our experts:

Q: Why should I care about tax-related identity theft? I’m not a victim.
A: Tax-related identity theft is a growing problem that affects everyone—taxpayers, the U.S. government and, of course, victims themselves. The number of known incidents has increased more than twelvefold since 2008, according to a recent study from the U.S. Government Accountability Office. More than $5.2 billion of taxpayer money went to fraudsters who filed fake returns in 2011, the Wall Street Journal reported, and a watchdog agency claims that number is expected to reach $21 billion in the next five years. The costs are huge. And though you may not be personally affected yet, it could happen to you or someone you know.

Q: How does it work?
A: Tax-related identity theft usually takes one of three forms:

  • The identity thief uses a name and stolen Social Security number with bogus W-2 forms to collect a refund in the victim’s name.
  • The bad guy uses stolen information to get a job, which creates problems for the victim when the government wants taxes on income the victim never earned.
  • The fraudster creates a fake IRS or accounting website to con unsuspecting taxpayers into filing their returns — chock full of personal information — online.

Q: How can I tell if I’m a victim?
A: Knowing you’re at risk is key. Telltale signs that you may be a victim of tax-related identity theft include:

  • Notice from the IRS that more than one tax return was filed in your name.
  • Notice from the IRS that you’ve received wages from an unknown employer.
  • Email from the IRS requesting your personal information. Why? The IRS doesn’t initiate contact with taxpayers by email so such a communication is likely to be fake.

Q: How can I protect myself?
A: The best way to protect yourself is to file your taxes early. Beyond that, “it’s very difficult to protect yourself from this type of identity theft because there are no safeguards in place where they need to be, within the IRS,” said Raul Vargas, a fraud operations manager at IDentity Theft 911. Reduce your risk immediately by following these five basic best practices to safeguarding your personal information from identity thieves.

Q: How long will it take for me to get my refund?
A: A few years ago, IRS identity theft investigations used to take at least six months and, despite the headache, most victims eventually would end up with their rightful refund checks. Now IRS investigations are taking more than a year and require victims to go through a lot of red tape.

Q: Where can I get more information about the IRS and tax-related identity theft?
A: The IRS has a lot of online resources, including these identity protection tips, a taxpayer guide to identity theft, and information about how to report it to its Identity Protection Specialized Unit.

If you think you’ve been a victim of Identity Theft or if you have questions about your insurance coverage for such an event, call ACBI at 203-259-7580.

Reprinted from Chubb & Son, By Raul Vargas, Fraud Operations Manager, IDentity Theft 911

Administration Issues Final Rule on Minimum Benefits Under Obamacare

Reprinted from Reuters via Insurance Journal

The Obama administration on Wednesday issued its long-awaited final rule on what states and insurers must do to provide the essential health benefits required in the individual and small-group market beginning in 2014 under the healthcare reform law.

A cornerstone of President Barack Obama’s plan to enhance the breadth of healthcare coverage in the United States, the mandate allows the 50 states a role in identifying benefit requirements and grants insurers a phased-in accreditation process for plans sold on federal healthcare exchanges.

Wednesday’s rule included few changes from previous administration proposals, a fact that could help states and insurers as they prepare for new online state health insurance marketplaces, known as healthcare exchanges, scheduled to begin enrolling beneficiaries for federally subsidized coverage on Oct. 1.

“The administration has been consistent in its approach to essential health benefits for more than a year, and that continued today. It’s good news for states and insurers because it means they don’t have to make any changes,” said Ian Spatz, a senior healthcare adviser at the consulting firm Manatt Health Solutions.

The exchanges are expected to cover as many as 26 million people within 10 years and seem likely to dominate individual and small-group insurance markets. Another 12 million people are expected to receive healthcare coverage through an expansion of the Medicaid program for the poor, according to the nonpartisan Congressional Budget Office.

Obama’s Patient Protection and Affordable Care Act sets out 10 benefit categories that must be covered by most plans at the same level as a typical employer plan. The categories range from hospitalization, prescription drugs and maternity and newborn care.

The American Cancer Society Cancer Action Network was cautious in its praise, describing the rule’s prescription drug mandate as an improvement but warning that it was unclear whether patients would have timely access to drugs needed to treat and survive serious illnesses including cancer.

COVERAGE CONCERNS

The rule got a cool reception from insurance and employer groups, which warned that higher costs could result from the new coverage requirements.

“The minimum essential health benefits standard will still require many individuals and small businesses to purchase coverage that is more comprehensive and more expensive than they choose to purchase today,” said America’s Health Insurance Plans President Karen Ignagni.

Neil Trautwein, National Retail Federation vice president, said the ultimate impact of the regulation will not be felt until plans are priced and sold on the market. “The administration has tried hard to navigate between the competing concerns,” he said. “But I’m worried that people won’t be able to afford coverage.”

Insurers including UnitedHealth Group Inc., Aetna Inc. and Cigna Corp. will use the government’s final word on these required benefits as they design plans and set premium prices ahead of the exchange launches. They have each said they will sell plans on some of the exchanges, but have not yet committed to which ones.

UnitedHealth, the largest insurer, said it is still reviewing the new rule. The company said the exchange insurance plans will essentially be a new type of coverage.

“In the long term, we are expecting and preparing for an ‘exchange’ category of coverage to become established as a new benefit category between Medicaid and the traditional commercial benefits markets,” spokesman Daryl Richard said.

The U.S. Department of Health and Human Services said the rule would mean greater access to mental health and substance abuse services by requiring parity with other healthcare benefits. HHS estimated that 62 million Americans would gain mental health coverage, an issue that has risen in importance after a string of mass shootings including last year’s elementary school massacre in Newtown, Connecticut.

The final rule preserved the state role in determining how the requirements are met by selecting their own benchmarks from plans sold within their respective borders. Most states opted for their home market’s largest small-group plan.

But after two years, HHS said it would review the situation and determine whether a new approach might be necessary.

The administration kept to the benchmark rule despite objections from consumer groups who claimed that some of the selected plans were not comprehensive enough and argued for a single, uniform federal package.

But HHS officials found that maintaining states as primary regulators of state insurance markets would keep benefit offerings more in line with services typically offered through employer-sponsored plans in each state.

“The states continue to maintain their traditional role in defining the scope of insurance benefits and may exercise that authority by selecting a plan that reflects the benefit priorities of that state,” HHS said in the rule.

The administration also gave insurers the chance to phase-in requirements for plans sold on federally facilitated exchanges and denied requests from groups that wanted to exempt low-cost community health plans and Medicaid managed-care plans from the accreditation process.

If you have questions about benefits and how the new laws will affect you, call ACBI at 203-259-7580.