Q&A helps navigate health insurance exchanges

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It’s time for the Affordable Care Act’s first big test.

On Tuesday, the online health insurance marketplaces — the centerpiece of President Barack Obama’s health-care law — are scheduled to open for business.

The plan is for millions of Americans to go online to compare health plans, find out if they’re eligible for federal help with premiums and buy coverage. But problems could impede the program’s debut.

What is an exchange?

It’s a website designed to make it easy for people to find health coverage. Each state will have one. The District of Columbia and 16 states, including Maryland, are running their own exchanges. The rest are either partnering with the federal government or, as in Virginia’s case, relying on the federal government to operate their exchanges. To find the correct site, go to www.healthcare.gov.

Who will use the exchanges?

The exchanges are designed for the uninsured, people who buy their own coverage and those whose employer-provided coverage is too expensive or lacks important benefits. Initial open enrollment is Oct. 1 through March 31.

Who won’t use the exchanges?

People who are in the country illegally are barred from the exchanges. Most workers at bigger companies that provide health coverage won’t use them. Medicare and Medicaid beneficiaries aren’t eligible for the exchanges.

What about federal workers?

Members of Congress and their personal staffs must use the marketplaces; the administration has said the government will continue to pay up to 75 percent of the premium, as it does for workers in the Federal Employees Health Benefits Program. Other federal workers will stay in the FEHBP.

What if I’m a small business owner?

For businesses with 50 or fewer employees, the federal exchange and most states will have a Small Business Health Options program, or SHOP exchange, that will give employees more options than they now have.

What kind of plans will I be able to buy?

All plans will offer “essential benefits” that include hospitalization, emergency care, maternity and pediatric care, mental-health care and prescription drug coverage.

Plans must cover preventive care — including flu shots, routine vaccinations and mammograms — at no cost.

Insurers will offer four tiers of plans, based on deductibles, co-payments and other costs to consumers: bronze, silver, gold and platinum. Bronze plans have the lowest monthly premiums but higher out-of-pocket costs.

How will this process work?

You can create an online account at www.healthcare.gov or with your state-run exchange. These sites will require you to provide information such as income and citizenship status.

The exchange will determine if you are eligible for Medicaid, but the system won’t be able to transfer your application to the proper state for processing until Nov. 1. (However, your Medicaid coverage will still start Jan. 1.)

If you are not eligible for Medicaid, the exchange will tell you how much of a subsidy you can receive for a private health plan. In most cases, the government will send subsidies directly to the insurers to pay part of the premium.

The exchange will display a list of health plans, their premiums and out-of-pocket costs, including deductibles and co-payments. If you decide to buy one of those plans, in most cases, you will be directed to the insurer’s website to make the payment.

You can also use the more traditional methods of filling out paper applications and applying over the phone.

What if I can’t afford the premiums?

The law provides sliding-scale subsidies to help people with incomes up to four times the federal poverty level — $11,490 — (about $46,000 for an individual, $62,040 for a couple, and $94,200 for a family of four) pay premiums.

There’s additional help with co-payments and deductibles for people with incomes up to 250 percent of the poverty level ($28,725 for an individual or $58,875 for a family of four).

People who receive subsidies will be required to pay 2 to 9.5 percent of their incomes toward premiums, depending on how much money they make.

What happens if I don’t buy insurance by January?

You will face a penalty of $95, or 1 percent of your income, whichever is greater, for the first year. The fine increases to $695, or 2.5 percent of income, in 2016.

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