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How Health Reform Could Change Your Coverage in 2013

It’s been a big year for the Affordable Care Act, a year filled with everything from a narrow victory in the Supreme Court to the re-election of a president who vows to implement the law on schedule.

But 2013 stands to be even bigger. In the video above, NewsHour senior correspondent Ray Suarez and Jay Hancock of Kaiser Health News discuss the changes you can expect as officials prepare for a massive expansion of the Medicaid program, the construction of online health insurance exchanges and the upcoming rollout of new taxes tied to the law.

Read a full transcript of their conversation below.

Full Transcript

RAY SUAREZ: Hi, Ray Suarez for the online NewsHour. And to look back at the year in health care legislation, I’m joined by Jay Hancock, reporter for Kaiser Health News.

And this is a year, Jay, that began with very belligerent talk of appeal and ended with the Speaker of the House calling the Affordable Care Act “the law of the land.” A pretty big change.

JAY HANCOCK: A pretty big change. And, of course, in between what happened was the Supreme Court upheld the Affordable Care Act with one proviso — giving states the option to opt out of the act’s requirement to expand the Medicaid program for low-income folks. And then the denouement [climax] was Obama won re-election.

Health care didn’t turn out to be quite as big of a topic during the campaign as some people thought, but it was certainly a subtext. Republicans promised up to the end to repeal and replace the Affordable Care Act if Obama lost.

But he didn’t. And so suddenly a lot of people’s to-do lists got a lot longer, and the end of the year turned out to be a lot of discussion about how to set up the exchanges, what’s going to happen in 2013 and a whole lot of elbow grease that’s going to get expended next year.

RAY SUAREZ: It’s a sprawling and pretty complex piece of legislation but its full effect really hasn’t been felt in a lot of households. What came online in 2012? Have people started to see the front edge of the Affordable Care Act?

JAY HANCOCK: They’re starting to see the front edge now and they’re really going to see a lot of discussion and effects in a lot of people’s lives in 2013. The real deadline for the full Obamacare rollout is Jan. 1, 2014, which is when the state exchanges — these online insurance sales websites — are supposed to be online, where people who lack coverage now can go get it through these websites.

Those are supposed to go live Jan. 1, 2014. There’s a lot of doubt about whether they’re going to be ready. Because of the uncertainty surrounding the law — with the Court, with the election — a lot of people held off rolling out getting the software ready, starting to design the insurance plans for these things. So now they’ve got to race to get ready. They’re actually supposed to start marketing these plans — starting advertising them to potential consumers — on Oct. 1.

And so there’s just a ton of work that has to be done by the insurance companies, by the software developers that have to get these sites ready, by the insurance commissioners in the states that have to oversee and regulate how all this gets rolled out and by the federal government, who, it’s turning out, is going to be responsible for running these exchanges in a lot of Republican states where the governors and the legislatures have said ‘no thanks,’ to a state-run exchange.

RAY SUAREZ: Well that’s a lot of states, and home to a lot of people. If you live in one of those states, are you going to notice the difference between you and someone else who lives in Illinois or New York, where they’ve embraced the exchange idea whole-heartedly?

JAY HANCOCK: When they’re fully rolled out and set up, I suspect not, I think for the average consumer looking at an exchange website isn’t going to see any obvious difference between the state-run exchange and the federal-run exchange. One of the questions, though, again, is how soon are they going to be ready?

The Department of Health and Human Services suddenly finds on its hands the job of running dozens of exchanges and a lot of people — including the insurance companies — are really doubtful about whether they can get it done in time.

RAY SUAREZ: There were finely balanced economic mechanics underlying the Affordable Care Act. Does it change the workability of the law that the Supreme Court has given states the ability to opt out of the Medicaid provisions or giving governors the power to opt out of the exchanges. Do those fine balancing acts inside the Affordable Care Act not work as well now that those are in there?

JAY HANCOCK: They don’t work as well. It’s not as dire for people who support the act as, for example, as if some of the income tax subsidies had been vacated by the Court.

However, the governors opting out of the Medicaid expansion is a big deal for patients. That was going to cover millions of patients. and it’s a big deal for the hospitals, who were hoping to get a lot of added covered patients that way, and who do have obligations under this act to care for people without insurance.

They still have the obligation to take care of people, the financing they were hoping for for isn’t going to be there. Their sort of last-ditch-hope, which was that HHS was going to allow a partial Medicaid rollout in some of the states where the governors are reluctant to go full-bore, HHS has now said, “It’s either all or nothing — you’ve got to cover people up to 133 percent of the federal poverty level, which is what the law requires, or don’t do it at all.” That’s going to be a whole in the coverage and and it’s going to be an issue for people on both sides of the equation.

RAY SUAREZ: During the tough political battles over the Affordable Care Act, a lot of attention was paid to people with no insurance. But as numerous as they are, the majority of Americans still have insurance. If you’ve got employer-provided insurance, is your life going to change at all as this gets phased in?

JAY HANCOCK: It depends, of course, on who your employer is. A lot of people are watching the small employers. There is a lot of speculation and fear that small businesses that don’t have a huge payroll or a lot of money to begin with might find requirements to cover people under the Affordable Care Act to be onerous and may make the decision to actually get rid of the health plans they have, pay the penalty that they risk under the act, and leave people to go seek care in the exchanges. That is a risk.

You’re going to see changes in the general health care system no matter what kind of insurance you have. The health system is changing whether it’s directly affected by the Affordable Care Act or not.

There’s a huge drive to quality and reducing readmissions for patients and also trimming down coverage for people who have health insurance even at large employers. The drive toward high-deductible health plans is going to continue, you’re more likely to have your employer raise your deductibles, start something that looks like a 401(k) plan, only it’s called a health savings account, which is similar, where you’re going to have to shoulder more of the out-of-pocket burden and the premium burden for buying your health care plan.

The Affordable Care Act also has what’s called a “Cadillac tax” to discourage wall-to-wall coverage that some people think induces people to use too much care and you may see your coverage get trimmed down for that reason, as well. So nobody is going to be exempt from change in the health care system.

RAY SUAREZ: So quickly before we close, even as people start to see the things that have turned out to be popular — kids who can be carried until they’re 26, no lifetime cap for coverage, no being rejected for preexisting conditions — there’s still a lot of this that remains in the realm of the unknown as far as how it’s going to work on the ground.

JAY HANCOCK: Yeah, and that’s the last thing that everybody is going to see in 2013 is the enormous education campaign by the Obama administration, by the states, by the exchanges.

Survey after survey shows that people just don’t understand what’s in this act — even people who it was intended to help. So you’re going to see a lot of marketing to folks to understand where these exchanges are, to understand that they need to go there to get coverage. Even the Medicaid expansion is going to go through the exchanges.

So you’re going to hear a lot of information in 2013 and the backers of this act really hope that people are going to become better informed, which is a really key component along with all this other stuff, to its success.

RAY SUAREZ: So after a momentous year in 2012, an even more momentous one on tap in 2013. Jay Hancock from Kaiser Health News, thanks a lot.

JAY HANCOCK: My pleasure. Thanks for having me.

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