How to Do Your Homework on Health Care Reform

Consumers will need to learn a lot to take advantage of new health insurance coverage options and subsidies.

By + More

It is hard to believe that the much-maligned and often misunderstood Affordable Care Act was signed into law more than three years ago. Ever since, one group or another has been trying to overturn it in either the courts or Congress.

Now, the law's most far-reaching requirement—the individual mandate for nearly all Americans to have health insurance—will become real with this fall's annual enrollment period for 2014 coverage.

As we near this milestone, it is uncomfortably clear that we should have spent a lot more time and money trying to help Americans understand this law. It can lay claim to being the most far-reaching piece of domestic legislation since the enactment of Medicare and Medicaid in 1965.

But we haven't devoted the time to help Americans understand the law. Congressional Republicans have blocked measures to fund the law's implementation. Liberal critics accuse the GOP of purposely sabotaging implementation of the law, waiting for the ensuing train wreck and then campaigning on the carnage in the 2014 mid-term elections. That may be true. But there are many well-intentioned opponents of the Affordable Care Act, and some of their objections are that it is poorly designed and too expensive. Should we expect them to sign more checks to make it easier to bring about changes they oppose?

Whatever the cause, the reality is that the health care reform law is extraordinarily complex. And consumers simply do not have the understanding or the tools to comply with the requirements that they obtain health insurance for 2014 or face financial penalties.

The Kaiser Family Foundation closely tracked the push for health care reform and has produced the most informed and clearly accessible materials about the new law. This is not an advertisement for Kaiser. But any consumer who wants to understand the law should go to school at the Kaiser health reform site.

Here, you can see a graphic timeline of when key provisions of the new law take effect, with links to the provisions. Individual states play a key role in expanded health insurance availability, primarily through state insurance exchanges and individual state decisions about whether and how to adopt the law's enormous expansion of Medicaid. Kaiser provides state-by-state reports on these and other state health initiatives.

Kaiser also has a 10-question Health Reform Quiz. Your answers will provide a quick guide to what you know and, more likely, don't know about the law.

I wish I could say similar nice things about HealthCare.gov, the federal government site explaining provisions of the law. But it suffers from a government-speak malady. And perhaps because opponents have been pounding away at the law for years, the communications wizards inside the U.S. Department of Health and Human Services (HHS) have become uber-sensitive about attacks on the law. Their public communications are framed by all the good things the law has or will do.

The reality, as outlined in a recent paper from Kaiser, is that "consumers do not understand their health insurance coverage—including benefit limits and exclusions, network designs, and cost sharing features." They don't know how to evaluate insurance choices, either, or how to resolve problems when health claims are denied or where to turn for help.

What's more, at least in terms of health care reform, consumers know that they are not well-informed. "A recent Kaiser Family Foundation poll showed that two-thirds of the uninsured and a majority of Americans overall say they have too little information to know how the Affordable Care Act will affect them," the Kaiser report said.

The government is scurrying to help get the new state insurance exchanges up and running. It is developing some of them in partnership with individual states and building others in states that have opted out of doing their own exchanges. Even just developing clear insurance applications is a challenge.

The law provides federal insurance subsidies through these exchanges. The subsidies are tied to consumers' incomes as a percent of federal poverty levels or FPLs. These FPLs rise a lot for bigger families, and large households earning close to $100,000 can still qualify for subsidies. So, it will benefit even middle-class consumers to learn about the new law.

Consumers also will need to learn a lot more about income taxes, because the subsidies are not just linked to wage incomes but to taxable incomes. Karen Pollitz, a senior fellow at KFF, keeps tabs on consumer aspects of the new law. She thinks the early draft insurance applications developed by HHS are "pretty good," but they are placeholders and will need to be succeeded by much more detailed forms.

"This stuff is pretty simple on the draft form but they're going to have to fix it" later, she said in an interview. In particular, the form "asks all these tax questions about people in your household. I would want to go to a consumer assistor [HHS is funding people to provide this support] and say, 'What am I supposed to do with this?'"

Another key aspect of making the insurance application process workable for consumers is the creation of a massive data hub that has been under development for years by the government. "The online system will begin tapping into a bunch of databases," says Pollitz. It's designed to provide extensive tax and related federal benefit information that would automatically populate a person's online insurance application. Of course, the hub has yet to be launched.

In addition, Pollitz notes, the hub will be missing a key piece of information. Historically, employers have not been required to report whether they offer health insurance to specific employees. But employed people will need to get this information from their employers to certify whether or not they have access to health insurance at work. If they don't, they can apply to an exchange. If they do, they're usually going to be better off sticking with an employer plan. But this decision will depend on their insurance-plan choices and premiums plus their incomes. "The employer thing is just a big exception" right now, she says.

Twitter: @PhilMoeller