The fog of insurance

Wednesday June 12, 2013

It would be an understatement to say that Vermonters are confused about the details of the new health care exchange that will become operational on Jan. 1, 2014. People often stop me on the street to talk about health care issues and the number one question they have asked me over the past few months is, "How will this new insurance thing affect me?"

I have written about exchanges a number of times, trying to help people prepare for the new world of health insurance but it seems that my efforts, as well as those of others, have either been too much too early or simply too confusing for people to make sense of it all.

What I will try to do here is to give people only a few of the important points that they need to understand in order to figure out if and how Vermont's new way of providing insurance, called Vermont Health Connect, will affect them.

If you are currently receiving insurance through the Medicare program, Vermont Medicaid, Dr. Dynasaur or the Tricare program for veterans then nothing will change for you. You will be unaffected by the new insurance landscape.

Vermont Health Connect is being called a health insurance marketplace. What it means is that private insurers will be offering insurance plans that meet the requirements of the Federal Affordable Care Act. There will be about 20 insurance products to choose from, but the coverage of all of those plans will vary very little, if at all.

The big difference between any of the plans will be the amount of premiums, co-pays and deductibles that a person has to pay for the plan that they choose. You may be able to buy a high deductible plan, meaning you have to pay the first $1,900 of medical bills (the highest deductible plan being offered) before your insurance kicks in, and that will mean that your premiums will be a little lower than the person who buys a plan with a $1,000 deductible.

Then there are out of pocket maximums ( a twisted way of making you pay more deductibles and co-pays) which could force you to pay up to $5,000 a year even though your so-called deductible is much less. Watch out for that one.

The complexity in all of this is figuring out which plan makes the most sense for you and your family from not only a financial perspective but also from a coverage perspective. Young and healthy people may find that buying a high deductible plan makes sense because they rarely have health problems.

The other big question is who will be required to buy this new insurance. If you are uninsured, are insured in the individual market or if you work for an employer who has 50 or fewer employees, you will be required to buy insurance from Vermont Health Connect.

If you are an employer of a business with 50 or fewer employees you will not be required to buy insurance for your employees but, if you choose to do so, then you will have to purchase that insurance from Vermont Health Connect.

If you currently have VHAP or Catamount insurance then you will have to choose one of the new products because those programs will no longer exist as of Jan. 1, 2014. Those plans have had subsidy levels that have made it possible for many people to buy insurance for the first time. When Vermont Health Connect is up and running, many of those who had VHAP or Catamount may find that their premiums, co-pays and/or deductibles are higher and that they can no longer afford insurance.

If you do not buy insurance by Jan. 1, 2014 you will have to pay a penalty of $95. In subsequent years that number will climb. For now, it means that it is likely a fair number of confused, frustrated and poorer Vermonters will choose to pay the $95 rather than try to figure out how to buy this new insurance product.

If you are one of those people who decides to buy the insurance there will be people hired by the state, called navigators, whose job it will be to help you understand your options and to make the right health insurance decisions for you and your family.

The state has awarded contracts to the navigators and they will publicize how to get in touch with these people. Vermonters can begin to sign up for insurance through Vermont Health Connect on October 1. It is expected that most people who sign up will use the new web site that is being created to allow people to understand and sign up for a Vermont Health Connect product.

If you want to ask questions directly to the people who will be running Vermont Health Connect I urge you to attend the community forum being held at the Putney Fire House tomorrow, Thursday, June 13, from 6:30 to 8 p.m. Bring your questions and don't be afraid to let them know that you want to know what it all means for you.

Richard Davis is a registered nurse and long-time health care advocate. He writes from Guilford and welcomes comments at


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