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Wednesday, September 18, 2013

Obamacare Begins January 1st: What Does it Mean for New Jersey Residents and Businesses?

By: Peter J. Lamont, Esq.
New Jersey Business and Personal Law Attorney
Law Offices of Peter J. Lamont

The face of New Jersey Health Insurance is about to change.

With the Affordable Care Act (ACA) coming into effect on January 1st, 2014, and the New Jersey health exchange and the federal government's Health Insurance Marketplace scheduled to begin business on October 1, 2013 New Jersey residents and businesses may be wondering what the ACA, or Obamacare, as it has been dubbed, will mean for them.

New Jersey Residents

Residents have the option to continue receiving their healthcare plans from their employers but there are close to one million people without insurance in the Garden State. For these citizens the advent of Obamacare will mean they now have choices and decisions to make.

Commencing October 1st, residents can chose the healthcare coverage they want effective January 1st, 2014 through the Marketplace's open enrollment. For the first year enrollment will end on March 31st, 2014 and in subsequent years enrollment will run from November 15th until December 7th.

Companies offering insurance on the Marketplace include Horizon Blue Cross Blue Shield of New Jersey, Aetna, AmeriHealth as well a co-operative - Health Republic Insurance of New Jersey (to be run by Freelancers Co-op of New Jersey). The nonprofit co-op is federally funded through a loan under the ACA with the purpose of offering more choices for the state's healthcare clients.

The Marketplace will allow residents the ability to compare coverage, costs and benefits. As well, an individual's application will help determine if they are eligible for a subsidy.

The Marketplace will be accessible through the government website, HealthCare.com, and will facilitate application for coverage as well as allowing applicants the ability to compare plans and enroll.

The legislation requires that each person carry minimum insurance defined as essential or face a penalty. For 2014, this penalty is $95 per adult and $47.50 for each child to a maximum of $285 per family.

The minimal essential health benefits include at least the following items and services:

  • Ambulatory patient services (outpatient care)
  • Emergency services
  • Hospitalization (such as surgery)
  • Maternity and newborn care
  • Mental health and substance use disorder services, including behavioral health treatment (this includes counseling and psychotherapy)
  • Prescription drugs
  • Rehabilitative services and devices (services and devices to help people with injuries, disabilities, or chronic conditions gain or recover mental and physical skills)
  • Laboratory services
  • Preventative and wellness services, and chronic disease management
  • Pediatric services

Close to 4 million non-elderly New Jerseyans (including about half a million children) have some sort of pre-existing health condition. Prior to the changes in healthcare that meant they were either denied coverage or required to pay more in premiums. Effective January 1st this will no longer be the case - the new law provides that no one shall be denied coverage or required to pay an excessive premium due to pre-existing conditions.

As well, lifetime limits on benefits are banned. This means that individuals suffering from chronic illness, such as cancer, no longer have to worry about how they will pay for their treatment once the limit has been reached.

New Jersey Businesses

Beginning in 2014 New Jersey small businesses can buy health insurance for their employees through a new program called Small Business Health Options Program (SHOP). Although they are not required to offer insurance under ACA in 2014, all employers (large and small) are required, under penalty of law, to notify employees of the ACA Marketplaces. Penalties could reach as much as $100 per worker per day.The US Department of Labour has information about the notification on its website and has provided model notices for employers.

The SHOP Marketplace will start taking enrollments on October 1st and is open to businesses with 50 or fewer full-time employees for 2014, increasing to 100 or fewer full-time employees in 2016.

The Marketplace will provide for a comparison of plans and coverage and help determine if the business qualifies for a small business health care tax credit. Beginning in 2014 the tax credit is only available for plans purchased through SHOP. Self-employed individuals with no employees must apply through the Health Insurance Marketplace.

For a small business to be eligible to purchase plans under SHOP and therefore be eligible for the tax credit, a certain percentage of its employees must enroll in the program. The percentage is determined at the time of application. In most cases a 70 per cent participation is required.

If you would like more information about this topic or have general legal questions, please feel free to contact me at (973)949-3770 or via email at plamont@peterlamontesq.com We answer legal questions on a daily basis and would be happy to discuss any issues or questions that you have with you.

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