Out of work since January, 60-year-old Stephen Douglass of Pequea has had to go without health insurance, a situation he hopes will change a month from today.
Beginning Oct. 1, Douglass and millions of Americans will be able to shop for coverage and also apply for cost-cutting tax credits at government-run online exchanges created by the Affordable Care Act.
Pennsylvanians who sign up at www.healthcare.gov will find multiple options offered by eight carriers.
Many low- and middle-income workers are expected to qualify for tax credits that will save the average family $2,672 a year, or about a third of the cost of coverage.
"For me personally, the timing's good," said Douglass, an unemployed financial services specialist who last month received donated care to test for an intestinal condition. "There's no question that (my wife and I) need health insurance."
An estimated 8,000 Lancaster County residents are projected to acquire coverage in 2014 through the exchange, according to Truven Health Analytics, and within five years that number is expected to rise to 25,000.
Nationally, about 8 percent of Americans are expected to find individual coverage on the exchanges through next March, when open enrollment ends.
The Oct. 1 debut of the health insurance exchanges, also called marketplaces, is a milestone in the rollout of President Obama's health reform law. Coverage begins Jan. 1, coinciding with a new mandate that most people have insurance or pay a modest penalty on their federal tax return.
The exchange is for people who don't receive employer-sponsored health benefits or qualify for Medicare or Medicaid.
But whether you buy your own insurance or are covered at work, all plans come under other Obamacare provisions taking effect in 2014.
Among the protections, insurers may no longer deny coverage because of a pre-existing condition, cancel policies or raise premiums excessively when the insured becomes ill, or stop coverage when a lifetime limit is reached.
"We're very supportive of these changes because ... we live every day seeing the plight of individuals who don't have insurance," said Marion McGowan, executive vice president at Lancaster General Health. "Access to insurance is the first step to getting good access to health care."
An estimated 14.2 percent of Lancaster County's population under age 65 (about 62,000 people) was uninsured in 2011, the most recent data available, according to the U.S. Census Bureau. Pennsylvania's rate was 12 percent.
Antoinette Kraus, director of Pennsylvania Health Access Network, a pro-health reform organization, said she's pleased with what she's seen so far of how enrollment on the government exchange will work.
"They got feedback and simplified it," Kraus said. "It looks like it's going to roll out in a pretty easy-to-use fashion."
She said someone signing up for insurance can expect the process to take about a half hour.
Denyse Glover, 55, of North Marshall Street, is a personal care assistant who lost employer-based health insurance three years ago. Working full time at less than $12 an hour, she turned to Project Access Lancaster County for charity care of a chronic lung inflammation and other health issues.
While she received excellent charity care, she's anxious to see if she can find affordable insurance on the exchange.
"I think the government should stay out of some things," Glover said, "but this is a way that everybody can have affordable insurance. That's part of the American dream."
With details about the insurance exchanges still being finalized, questions remain about how they will work. What follows is a look at what is known so far.
Exactly how much will coverage purchased on the exchange cost?
In Pennsylvania, we won't know the answer until later this month, when the U.S. Department of Health and Human Services releases the insurers' premium prices.
But several other states that are running their own exchanges, including neighboring Maryland, have already come out with the prices for their residents. We can look at those price lists to get some idea of what Pennsylvanians might pay.
The first thing to know is the exchanges offer four price tiers: bronze, silver, gold and platinum. A bronze plan is the least expensive because it covers only 60 percent of one's medical care. A platinum plan is the most expensive, covering 90 percent of costs. Silver and gold cover 70 and 80 percent, respectively.
The second thing to know is price varies based on age, region and tobacco use. The older you are, the more it's going to cost, but no longer will one's sex or health status affect the cost of coverage.
The insurers that have decided to sell plans on Pennsylvania's exchange include Aetna, Capital Blue Cross, Health America and Highmark.
We'll soon find out what their plans will cost, but for now let's look at examples of Maryland's monthly rates.
For a 25-year-old nonsmoker who lives in Cecil County (which borders Lancaster County), the rates for a bronze plan range from $122 to $236. For a 50-year-old nonsmoker who lives in Cecil County, the rates for a silver plan range from $292 to $470.
The actual out-of-pocket costs, however, will be lower for those consumers whose income qualifies them for a tax credit.
Who will be eligible for a tax credit to reduce their cost for coverage, and how will that work?
You don't have to be poor to qualify for a federal subsidy to purchase health insurance on the exchange. Even middle-income Americans will be eligible for some help. But the general rule is the less you earn, the bigger your tax credit.
Specifically, the tax credit is for those earning between 100-400 percent of the federal poverty level. So if you're single and earn less than $46,000, you'll get some help. A family of four earning less than $94,200 also will qualify.
The Kaiser Family Foundation says that about half of the consumers who currently buy their own health insurance would qualify for a federal subsidy on the exchange.
The online enrollment process will inform the consumer whether he qualifies for a tax credit and what the discount will be.
Once the consumer purchases a plan, that credit then goes directly from the government to the insurer. The buyer never handles the money, but simply pays a lower premium.
How much lower?
A worker earning $15,860 who buys insurance costing $5,000 can get a credit that reduces the cost to $520, or $43.33 a month. A worker earning $34,470 who also buys insurance priced at $5,000 can get a credit that reduces the cost to $3,270, or $272.50 a month.
What's the penalty for those who fail to buy insurance?
Actually, thousands in Lancaster County, particularly the Amish and other Plain Sects, will face no penalty because the government recognizes religious objections to insurance.
No penalty is assessed, too, to those earning less than $10,000 or to those who would have to pay more than 8 percent of their income for coverage.
Also, those who would qualify for Medicaid under the new expanded program that Pennsylvania has opted out of are also exempt from the penalty.
But almost everyone else can expect to have a penalty assessed on his or her federal income tax.
The penalty in 2014 will be at least $95 for an adult, $47.50 for a child and $285 for a family, or 1 percent of income, whichever is greater.
By 2016, the penalty increases to $695 for an adult, $347.50 for a child and $2,085 for a family, or 2.5 percent of income.
No one will go to jail for not having insurance, but the IRS can withhold tax refunds to cover the penalty.
Aren't small businesses also able to use the exchange to purchase insurance for their workers?
Yes, Pennsylvania employers with 50 or fewer full-time equivalent workers may also buy coverage for their work force at www.healthcare.gov., but not until next year.
At that time, some employers, particularly those with low-wage workers, may qualify for tax credits worth up to 50 percent of the premium cost. Any premium costs not covered by a tax credit will be tax deductible.
Beginning in 2016, the small-business exchange, known as Small Business Health Options Program, or SHOP, will be open to employers with a work force of up to 100 full-time equivalents.
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