Kentucky will set up a health benefit exchange if the Supreme Court approves the health care law. The idea of the exchange is to allow individuals and small businesses to compare coverage, provider networks and costs and purchase affordable Kentucky health insurance online. The law requires all states to have their health exchanges up and running by January 2014, failing which the federal government will step in to set them up.
Gov. Steve Beshear said that though no one is sure about what the Supreme Court will decide, Kentucky is ready to follow the law, if upheld.
The exchange will serve many purposes:
• allow the purchase and sale of Kentucky individual health insurance plans
• assist small businesses in purchasing health coverage for their employees
• help small businesses qualify for tax benefits
• allow individuals to enroll in health plans, Medicaid and KCHIP, and get tax credits and subsidies for premiums
• allow individuals without employer sponsored coverage to directly purchase plans of their choice
According to State officials, the governor’s decision has the support of several groups representing health care agencies, advocates and employers, including the Kentucky Hospital Association, the Kentucky Chamber of Commerce, and leading Kentucky health insurance companies such as Anthem Blue Cross Blue Shield.
Neither the governor not these groups support the idea of a federal-run exchange. Bryan Sunderland, vice president of public affairs for the Chamber believes that there should be some sort of local control, but that the state should have the freedom to chart its own course in health care reform.
Chamber officials also said the health insurance Kentucky exchange, if set up, should “operate as an open marketplace that supplements, rather than supplants, the existing insurance market.”
It must be noted that the Chamber has serious concerns about the health care law’s impact on business. These concerns are brought about the provisions of the law. For instance, if employers with more than 50 workers do not provide their workers with coverage, and if the workers who qualify for health insurance subsidies buy their plan through a health exchange, the employer would be subject to a “free rider” penalty of $2,000 to $3,000 per employee.
However, the law also holds benefits for small businesses:
• Employers with less than 50 full-time workers can purchase employee coverage at a more affordable cost in the health exchange
• Businesses with fewer than 25 workers who earn an annual average wage of less than $50,000, are eligible for a tax credit if they help their employees purchase coverage
The U.S. Supreme Court is expected to deliver its ruling on the constitutionality of the federal act in late June.
While Kentucky residents and businesses can shop for coverage directly at the health benefit exchange, they cannot do with professional guidance. Obamacare envisions an important role for health insurance brokers. Only educated, experienced and licensed Kentucky health insurance brokers can provide employers and individuals with the information and unbiased guidance they need to make informed decisions.