American Rescue Plan 8.5% cap and Massachusetts

[BobTomas]

Hi, I have a question which I hope you can answer because I am losing my sanity talking to the helpline!

My understanding is that with the ACA you are capped at maximum premium of 8.5% of income (if you are >400%FPL) for 2022. This is for what are classed as benchmark silver plans. We are enrolling on the Mass health connector (their market place), and our income is <400%FPL.

We were offered a subsidy of $780 (yay) but all of the silver plans offered are more than twice what 8.5% of our income is and twice that of what it would be at if capped at 8.5% and our income was just over 400% FPL.

This makes no sense to me and the helpline just says we are not eligible for those plans and they are not offered to us on the marketplace.

Summary: If our income was just over 400%FPL then the 8.5% premium maximum for a benchmark plan would be significantly less than the premiums we are being offered on the marketplace being just under 400%FP. Being told we are not eligible for those plans and so not offered on the marketplace. I thought everybody was eligible for a benchmark plan with the 8.5% cap? How do you get it?

Hope that makes sense

Best

Bob

 

[PaunchyPirate]

Specifically, the benchmark is the second lowest cost silver plan (SLCSP) in your zip code. You should be subsidized to make it so that your cost for that SLCSP is no more than 8.5% of your income. Any other silver plans are not part of the calculation.

After that subsidy amount is determined, you can buy any plan you want at its offered price (bronze, silver, gold), but your subsidy amount does not increase or decrease (unless you go so low that you buy a free bronze plan).

What zip code are you using?

I just used your exchange site's estimator tool for a zip code in Worcester using an income of $68,000 for 2 people aged 60. It came back with a subsidy of $910 and an estimated cost of $399 for the benchmark silver plan. Looking at the plans that come back in the results, I see a wide difference in pricing in the silver plans. But you need to focus on the second lowest cost one and do the math from that one. Then decide if you wish to pay more or less than that.

The second lowest cost silver one that I see offered to me would cost me exactly 8.5% of the $68,000 income I entered.

Edited to add: I'm not sure why you are not being offered certain plans on the marketplace. That must be something specific to Massachusetts. In most places, you can buy any plan you want. But you have to pay the difference in price after your subsidy is accounted for.

 

[BobTomas]

Thanks. We are zip code 02451 and used $64K income. Blue cross has been selected as the base benchmark plan in Mass, yet the cheapest Blue cross plans offered to us are $749 for a bronze and $1250 for a silver! Do you have a link to the estimator you used...the one I can find just compared plans but does not show cost?

many thanks

 

[PaunchyPirate]

Click on the "Get an Estimate" link at the top of the https://www.mahealthconnector.org website.

or https://betterhealthconnector.com/get-an-estimate

 

[Sarah S]

I am not sure if this is your issue but it is true that if you are getting a level of subsidy ( that I think is called Connector Care) you can’t buy all of the plans you can unsubsidized. What you can do is pay for it in full and if your income qualifies get the subsidy when you file your taxes. When I had ACA in my MA county HCHP Tufts Premier ( with the non restricted network not the cheaper Tufts Direct) and HCHP were not available with subsidy

 

[BobTomas]

Got it, Many many thanks PaunchyPirate! That backs up what I thought - we should have access (but it still shows Blue Cross at >$1200) even though they are the base benchmark EHB plan for MA? I do see 2 other plans for <$450 though. Will need to poke around a bit more. Thanks for the info Sarah!

 

[PaunchyPirate]

Got it, Many many thanks PaunchyPirate! That backs up what I thought - we should have access (but it still shows Blue Cross at >$1200) even though they are the base benchmark EHB plan for MA? I do see 2 other plans for <$450 though. Will need to poke around a bit more. Thanks for the info Sarah!

I guess I would question where you were told that Blue Cross is the base benchmark. In other states, there is no such thing as an across the board base benchmark plan that I have ever heard of. Second Lowest Cost Silver Plans can/will vary from zip code to zip code depending on how the insurance companies price them in the various zip codes. Rural areas may differ from urban areas. Areas with a large hospital system may differ from those without. Etc.

PS. I don't know what an EHB is. So maybe I'm not comparing apples to apples.

 

[BobTomas]

Just some info from the web:

"Benchmark plan is the term used to describe the second-lowest-cost Silver plan available in the exchange, and it's also the term for the plan that each state designates as the standard for essential health benefits (EHBs)"

and from Mass.gov

"Pursuant to Section 1302 of the Affordable Care Act and federal rule 45 CFR 156.100, the Commonwealth of Massachusetts (“Commonwealth”) has selected the base-benchmark plan[1] for coverage year 2017 and years thereafter. The EHB Benchmark Plan[2] defines the Essential Health Benefits (EHBs) to be included in all small group and individual plans (merged market plans) offered in the state, both within and outside of the Marketplace (the Health Connector). For the 2017 plan year and years thereafter, the Commonwealth has selected the HMO Blue New England $2000 Deductible Plan (“HMO Blue New England”) offered by Blue Cross Blue Shield of Massachusetts HMO Blue, Inc. as its base-benchmark Plan ".

I took this to mean that that plan should be subject to the 8.5% cap (and other insurance companies would offer comparable EHB plans also available at 8.5%). But it seems that the 8.5% only applies to one or two particular silver plans(not Blue Cross).

A lot of confusion came when the help line insisted that we were not eligible for 8.5% plans and that they were not even offered to us on the marketplace (the cheapest blue cross silver plan was $1290, not the $453 which is 8.5% of our income).

 

[PaunchyPirate]

Just some info from the web:

"Benchmark plan is the term used to describe the second-lowest-cost Silver plan available in the exchange, and it's also the term for the plan that each state designates as the standard for essential health benefits (EHBs)"

and from Mass.gov

"Pursuant to Section 1302 of the Affordable Care Act and federal rule 45 CFR 156.100, the Commonwealth of Massachusetts (“Commonwealth”) has selected the base-benchmark plan[1] for coverage year 2017 and years thereafter. The EHB Benchmark Plan[2] defines the Essential Health Benefits (EHBs) to be included in all small group and individual plans (merged market plans) offered in the state, both within and outside of the Marketplace (the Health Connector). For the 2017 plan year and years thereafter, the Commonwealth has selected the HMO Blue New England $2000 Deductible Plan (“HMO Blue New England”) offered by Blue Cross Blue Shield of Massachusetts HMO Blue, Inc. as its base-benchmark Plan ".

I took this to mean that that plan should be subject to the 8.5% cap (and other insurance companies would offer comparable EHB plans also available at 8.5%). But it seems that the 8.5% only applies to one or two particular silver plans(not Blue Cross).

A lot of confusion came when the help line insisted that we were not eligible for 8.5% plans and that they were not even offered to us on the marketplace (the cheapest blue cross silver plan was $1290, not the $453 which is 8.5% of our income).

Got it. I would read that paragraph to mean the Blue Cross plan serves as the minimum acceptable health benefits a plan must cover. In other words, all plans must pay for the same benefits in their plans as the Blue Cross one does. It doesn't say the plans need to provide that coverage at the same price as Blue Cross.

In other words, the base plan sets coverage for colonoscopies, blood tests, pregnancy/birth, some level of prescriptions, a primary care visit, a specialist visit, etc. Some (all?) of this is mandated by the ACA legislation at the federal level.

The insurance companies decide each year how much they will charge for that coverage in each zip code. They also decide if they wish to offer additional things in their plans. They are permitted to cover more things. They may choose to do so to be more competitive.

The SLCSP "benchmark" is a separate thing related to determining the ACA subsidies.

 

[Sarah S]

I think PP nailed it. When I had ACA Blue Cross was consistently one of the top 2 in price of silver plans - usually the most expensive. I don’t believe Massachusetts law could dictate an exception from the second lowest price rule of aCA federal subsidies.

 

[BobTomas]

That makes sense, thanks! So not every 2nd-lowest silver plan from each provider on the market place is capped at 8.5%, just a specific one (or two) it seems.

 

[PaunchyPirate]

That makes sense, thanks! So not every 2nd-lowest silver plan from each provider on the market place is capped at 8.5%, just a specific one (or two) it seems.

Look at this from one zip code's perspective.... for a given age, there is ONLY one SLCSP in that zip code. In my state, they also seem to consider your smoking status, but I didn't see that on Massachusetts exchange.

It could be from any health insurer. For example, in zip code 12345, an age 60 person will find their SLCSP to be provided by Blue Cross, and it will cost $1000/month unless they qualify for a subsidy.

In zip code 12345, an age 64 person will find their SLCSP to be provided by United Healthcare, and it will cost $1500/month unless they qualify for a subsidy.

Don't think about how many SLCSP's a provider has. That doesn't matter. No one really cares about that. The only thing that is important is YOUR SLCSP in YOUR zip code. You will not have to pay more than 8.5% of your income for that plan and only that plan. This plan is used to determine your subsidy. Your subsidy will be the amount the government will kick in to ensure you do not pay more than 8.5% for the SLCSP plan. Once that subsidy is determined, you can forget all about SLCSPs. You should be able to use your determined subsidy toward the purchase of any plan you want. Unless Massachusetts does something different than my state (PA) or the Federal Exchange.

 

[BobTomas]

If only the help line could have explained that it would have saved a lot of grief! Many thanks!

 

[PaunchyPirate]

Great. By the way, take note that you may actually see some Gold plans (with better coverage than the Silver plans) at a lower price point than some Silver plans. This is because some states ask the insurance companies to inflate the prices of Silver plans in order to get more Federal subsidies for their citizens.

 

[jim584672]

Check with this one as well...

https://www.kff.org/interactive/subsidy-calculator/

 

[RetiredAndLovingIt]

Aren't you the guy that the state put on Medicaid last year even though you told them more than once that you shouldn't qualify due to your high income.
How did that work out for you, have you been on it all this time and they're now just figuring it out?

 

[BobTomas]

Yes I am We applied through the health connector marketplace with $123K income (verified by uploaded income statements that were reviewed) last July and to our surprise we were put on Masshealth – fully free and excellent health care (our Medicaid). All the doctors and best hospitals we wanted (the same as we had on private insurance). Top class service.

I called them three times over several months to query and they said even though we had 6-figure income we had been selected to get it because of the state of emergency. They repeated back to us what our income was. Very strange! If you are assigned Medicaid then you cannot access the market place, even if you wanted to buy it yourself. We had no problems using it at all, got everything we wanted very conveniently, although I felt guilty. But what can you do!

Now, after one year it is time to renew/review our policy to see if we still qualify. After completing the exact same online process (same account) but updating our income from $123K to $64K, this time we are allowed to access the healthcare marketplace and got a $782 subsidy. I miss Masshealth now that I see the prices!

 

[jim584672]

I have been locked in Medicaid since March 2020. It has been great, I can make as much as I want and not lose coverage. Nothing illegal, I was legally on it and they locked us in.

 

[jim584672]

Yes I am We applied through the health connector marketplace with $123K income (verified by uploaded income statements that were reviewed) last July and to our surprise we were put on Masshealth – fully free and excellent health care (our Medicaid). All the doctors and best hospitals we wanted (the same as we had on private insurance). Top class service.

I called them three times over several months to query and they said even though we had 6-figure income we had been selected to get it because of the state of emergency. They repeated back to us what our income was. Very strange! If you are assigned Medicaid then you cannot access the market place, even if you wanted to buy it yourself. We had no problems using it at all, got everything we wanted very conveniently, although I felt guilty. But what can you do!

Now, after one year it is time to renew/review our policy to see if we still qualify. After completing the exact same online process (same account) but updating our income from $123K to $64K, this time we are allowed to access the healthcare marketplace and got a $782 subsidy. I miss Masshealth now that I see the prices!

The PHE is still on, you will not lose coverage until it expires and they don't renew it.

https://aspr.hhs.gov/legal/PHE/Pages/covid19-15jul2022.aspx

 

[BobTomas]

Waiting to see what happens. We are locked out of the marketplace again while we upload income docs for review - so maybe we'll stay on it after that! Last year they initially offered a subsidy on the day we applied but the next day we were locked out and on medicaid! Fingers crossed we stay on!

 

[jim584672]

Waiting to see what happens. We are locked out of the marketplace again while we upload income docs for review - so maybe we'll stay on it after that! Last year they initially offered a subsidy on the day we applied but the next day we were locked out and on medicaid! Fingers crossed we stay on!

It doesn't matter, upload whatever income you want and it renews. No one gets dropped while the PHE is on.

 

[BobTomas]

Thanks. Will update!

 

[BobTomas]

It doesn't matter, upload whatever income you want and it renews. No one gets dropped while the PHE is on.

As you said! We just got a letter saying we can't be kicked off and are staying on it. w00t!