BRATTLEBORO -- State officials are scrambling to make sure everything is in place when individuals and small businesses start to shop for insurance under the new state run insurance marketplace on Oct. 1.
The massive online system is still being worked on and questions remain about the subsidies and tax breaks associated with the new system and how people on Medicare will be accepted.
Still, come Oct. 1 businesses with fewer than 50 employees and individuals will have to begin purchasing their insurance through Vermont Health Connect, and representatives from Blue Cross Blue Shield of Vermont were in Brattleboro Thursday to talk with business owners and human resource representatives about the transition.
It's estimated that more than 100,000 Vermonters are going to be required to purchase their insurance through the new online marketplace in the fall, with the new coverage beginning in 2014.
About 50 people packed the small conference room at Brattleboro Savings and Loan for the early morning meeting Thursday where Blue Cross Blue Shield of Vermont CEO Don George stressed that the new online marketplace represents significant change in how customers will purchase their insurance.
"These are extraordinary times," he said. "We are focused on 2014. There is a near term challenge and we want to help with the transition."
Blue Cross Blue Shield of Vermont has been holding meetings throughout the state as the company prepares for Oct.
He said only about one-third of the people who took part in a recent survey heard of the health care exchange, and with less than seven months before thousands of people will be expected to use it, George said the company is trying to get the word out.
"It's a new product with a new distribution model, new rules and new choices," he said. "We have some challenges."
The new insurance marketplace is required under the federal Affordable Care Act and last week Vermont became the first state in the nation to announce rates under the new system, though George said those rates are estimates and will likely change before October.
Along with setting up the new online system and forcing small business owners and individuals to shop for their insurance plans at one single place, Vermont Health Connect establishes new plans, rates and subsidies and small businesses are going to have some big decisions to make as they move over to the new marketplace.
George also admitted that the state is still working on the IT behind the online exchange.
Doctors, customers and insurance companies will have to be able to access the enormous system and George said there are sure to be bumps in the road as the marketplace rolls out.
Catherine Hamilton, Blue Cross Blue Shield of Vermont vice president of planning, said the new health care law mandates that businesses with fewer than 50 employees use Vermont Health Connect to shop for, and purchase, insurance.
The changes, she said, are coming from more than 3,000 pages of state and federal health care rules.
"There is a lot of misunderstanding," she said. "If you are confused you are not alone."
Hamilton and George both stressed that the changes that are going into effect on Oct. 1 grow out of the federal health care law, and not the state's drive to create a single-payer health care system, which has been put off until 2017.
Small companies with fewer than 50 employees will not be penalized if they don't offer insurance, but individuals must be covered, and they will have to pay a tax penalty if they don't sign up for a plan.
In the first year, individuals who do not sign up for a health care plan will pay 1 percent of their income, or up to $95, with the penalty rising to 2.5 percent, or up to $695 in 2016.
Throughout the meeting Hamilton answered questions from concerned human resource employees and business owners, and for some of them, Hamilton admitted that the answers were not yet entirely clear.
"Some of this is still in flux," she said, adding that the Legislature is working on many details during this session and will provide more answers in the spring. "It's an enormous project and the timeline is tight."
The new exchange, she said, allows consumers to compare options.
Low income individuals will receive subsidies for the various plans which offer different levels of coverage.
Businesses and their employees will have to figure out the best options, which she admitted might be complex and confusing to navigate at first.
Even if a company offers a plan, for instance, it might be better for the employee to purchase the plan independently depending on how the subsidies, which are tied to individual income, kick in.
But she added that many individuals will face higher costs, even when subsidized, if they don't participate in employer-sponsored group plans.
Hamilton said Blue Cross Blue Shield is opening an office in Burlington, and hiring staff to answer questions over the phone to help customers through the next few months.
"There will be winners and losers and we want everyone to be prepared," Hamilton said. "The most important point is that we want to make sure everyone is covered."
Howard Weiss-Tisman can be reached at firstname.lastname@example.org, or 802-254-2311, ext. 279. You can follow him on Twitter @HowardReformer.