1. The Affordable Care Act
A Non-Partisan Presentation
Thomas McAuliffe
Missouri Foundation for Health

2. Percentage of All Firms Offering Health
Benefits, 1999-2009
100%
90%
80%
69% 68%
70% 66% 66% 66%
63% 61% 63%
60% 60% 60%
60%
50% 56% 57% 58% 58%
55%
52%
47% 48% 49%
40% 45% 46%
30%
20%
10%
0%
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
All Firms
3-9 Workers

6. Carrot Patient Protection Stick
and Affordable
Care Act
More People (ACA) Costs
Creates Market Places Expanding Medicaid Individual Mandate
(Exchange)
Business
Subsidies to Purchase Improving Medicaid
Requirements
Subsidies to small Increasing health Fees / Taxes
businesses workforce
Changes to insurance Politics of health Payment & Prevention

7. Topics Covered in the ACA
• Health Insurance Exchanges • Medicaid
• Tax Credits for Individuals • Medicare
• Impact on Small Businesses • Workforce/Access to Care
• Employer Requirements • Quality of Care
• Private Insurance • Prevention
• Individual Mandate • New Models of Care

8. Major Themes of the ACA
• Expanding Health Insurance Coverage
• Insurance Regulations
• Focus on Prevention
• New Models of Care
• Increasing Quality

10. Health Insurance Exchanges
• Like a Farmer’s Market for health insurance
• Individuals and small businesses (<100)
• Larger employers beginning in 2017
• Creates four benefit plans, plus catastrophic plan
• Guarantee issue and renewability
• Rating rules (only for age, family size, and tobacco)

12. Benefit Design
• Essential health benefit package includes:
• Preventive care • Prescription drugs
• Hospitalization • Maternity care
• Emergency services • Mental health and
substance abuse
• Benefits features:
• No cost-sharing for preventive care
• No annual or lifetime dollar limits on coverage
• Coverage for dependents up to age 26

13. Premium Subsidies to
Individuals/Families
Tax Credits: Maximum Percent of Income Paid for Premiums
Income for a Family of Four Percent Paid for
FPL Range From: To: Premiums
100-133% of FPL $23,050 $29,327 2% of income
133-150% of FPL $29,327 $33,075 3-4% of income
150-200% of FPL $33,075 $44,100 4-6.3% of income
200-250% of FPL $44,100 $55,125 6.3-8.05% of income
250-300% of FPL $55,125 $66,150 8.05-9.5% of income
300-400% of FPL $66,150 $88,200 9.5% of income

14. Example
$44,100 -Annual income for family of four at
x 6.3% 200% of poverty
$2,778 – Family’s Share ($232/month)
Bronze Plan $10,000
Family’s Share - $ 2,778
Premium Support $ 7,222

15. Example
Bronze Plan $10,000
Family’s Share - $ 2,778
Premium Support $ 7,222
Gold Plan $12,000
Family’s Share - $ 2,778
Premium Support - $ 7,222
Additional Family Share $ 2,000
Total Family Share for Gold Plan:
$4,778 or $398/month

16. Small Business
• No requirement that small employers must offer
health insurance or pay a fine (<50 employees)
• Sliding scale tax credits for small employers
(<25 employees)
• Access to the Exchange in 2014 and must use tax
credit within the Exchange starting then

17. Employer Requirements
• Employers with >50 employees
• If do NOT offer coverage
• If do offer coverage
• If employer offers coverage, the employee’s share of
premium must exceed 9.5% of income in order for them
to be eligible for a tax credit in the Exchange
• Employers with >200 employees
• Report health coverage on W-2 forms (year delay for
employers that file fewer than 250 W-2’s)

18. Changes to Private Insurance
• No annual/lifetime limits
• No rescinding coverage
• No pre-existing condition exclusions
• Rating rules
• Guaranteed issue
• Dependents up to 26
• 80-85% of premium spent on medical services
• (~$65 million in rebates in Missouri)

19. Individual Mandate
• All individuals must have “qualifying” coverage
• Those without coverage:
• Will be required to pay a phased-in penalty:
○ $95 or 1% of taxable income in 2014,
○ $325 or 2.0% of taxable income in 2015, and
○ $695 or 2.5% of taxable income in 2016
(up to a maximum of three times that amount or $2,085)
• Exemptions for financial hardship, religious
objections, or 8% rule

20. Expansion of MO HealthNet
• Expand Medicaid to 133% of FPL for non-Medicare
individuals and families
• Guaranteed benchmark benefit package
• 100% federal funds at first, then step-down to 90%

21. 18%

22. 2012 Federal Poverty Levels (FPL)
85% 100% 133% 185% 300%
1 $9,495 $11,170 $14,856 $20,665 $33,510
2 12,861 15,130 20,123 27,991 45,390
3 16,227 19,090 25,390 35,317 57,270
4 19,593 23,050 30,657 42,643 69,150

23. • 90 percent of
the currently
uninsured
have incomes
below 400%
of poverty.
• 66% of the
currently
uninsured
have incomes
below 200%
of poverty.

24. Source: The Missouri Medicaid Expansion: Good for All Missourians

25. BUDGET SUMMARY
COST, SAVINGS & REVENUE
General Revenue Summary -- Dollars in Millions
FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21
Cost New Eligibles $0.0 $0.0 $0.0 ($30.1) ($69.3) ($86.6) ($117.6) ($143.3)
Savings $31.0 $71.4 $82.3 $81.2 $78.9 $79.6 $78.4 $78.0
New Revenues $15.5 $53.6 $57.3 $61.8 $63.0 $65.0 $67.2 $69.6
Total Impact on GR $46.5 $125.0 $139.6 $112.9 $72.6 $58.0 $28.0 $4.3
Source: Missouri Office of Administration

26. Arguments Against Expansion
• The US and Missouri can’t afford this
expansion
• Medicaid is a broken system
• Congress change the terms of the expansion
• Affect on the state’s credit rating (AAA-
Negative outlook)

27. Challenges
• Medicaid Expansion
• Will it happen?
• Exchanges
• What will they look like?
• Access is still significant problem
• Parity & cost-savings
• Navigators
• Who is going to assist with enrollment?

28. 19 Declared State-based Exchange; 7 Planning for
Partnership Exchange; 25 Default to Federal Exchange

29. CoverMissouri.org
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30. Contact Information:
Thomas McAuliffe
tmcauliffe@mffh.org
314-345-5574