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What the Health Law Really Means for New Yorkers

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On the morning the Supreme Court announced its ruling on the Affordable Care Act, my staff and I gathered around our computers, following CNN, the SCOTUSblog, the New York Times and Twitter simultaneously to track the decision.

As the initial reports started to roll in, there were a few minutes of confusion as we all tried to make sense of conflicting information from different sources covering the ruling. From all corners of our office arose choruses of, "Wait, WHAT?!"

For those of us who work on health policy issues, it quickly became clear what the actual decision was: most of the law, including the mandate that most Americans must purchase health insurance, was constitutional. The court did rule that states could choose not to participate in the Medicaid expansion included in the health reform law but still continue to receive federal funding for their existing Medicaid programs.

But for people who don't spend their days tracking health policy and health care issues, the confusion persists; there's still a good deal of, "Wait, WHAT?!" in the ether. A Pew poll found that 45 percent of people surveyed in the days following the decision did not know how the court had ruled. I talked to numerous reporters who mistakenly thought the Medicaid expansion had been completely struck down. And hardly anyone could give a clear and specific explanation of what the decision will mean in practical terms for people who are buying health insurance when the law takes effect.

People have some very basic questions, most of which boil down to: What does the law really mean for me?

Too often, the answer I hear is, "It's complicated."

Well, yes, the law is complicated and many of the operational details are still being worked on at the federal and state levels. But "it's complicated" doesn't cut it. We need to do a much better job of helping people understand what the law means for them, for their families, and for their businesses. It's complicated, but we can give some basics, at least. Let me take a first stab at concise answers to some of the pressing questions I'm hearing over and over again (followed by some more of the nuance):

Our household income is $40,000 a year. What kind of help might we get to cover my wife, two kids, and me?

The simple answer: You can expect to get a subsidy that covers a large percentage of your annual premium. Out of pocket, it is likely that you'd pay just under $2,000 for your family's coverage.

...but it's a little complicated: The new law establishes four categories of benefits: Bronze, Silver, Gold, and Platinum. The example above assumes you're choosing a Silver policy (not the most generous, but not the stingiest). If you were to choose a Bronze policy -- which provides the most minimal coverage -- your share of the premium would be even less, and might be covered completely by the subsidy in this example. Another complicating factor is that your share of the premium will vary according to your income; people earning more will pay a larger share that does not exceed 9.5 percent of their income.

To learn more: You can plug your own data (age, income, and region) into the Kaiser Family Foundation's very handy resource, the Health Reform Subsidy Calculator.

I might prefer to stay uninsured and take the penalty. How much would that cost?

The simple answer: In 2014, the penalty will be a $95 flat rate per person or 1 percent of taxable income, whichever is greater.

...but it's a little complicated: The penalties will increase between 2014 and 2016. The penalty is assessed as either a flat rate or a percentage of household income, whichever is greater. In 2016, the flat rate will be $695 per person (up to three per family) or 2.5 percent of family income.

To learn more: Community Catalyst offers a clear overview of the individual mandate here.

I run my own small business; I have 20 employees. What does the law mean for me?

The simple answer: A business with 20 employees wouldn't face any penalty for not offering coverage. However, it could be eligible for tax credits that would help them offer health insurance more affordably for low-income workers.

...but it's a little complicated: The health reform law requires that businesses with 50 or more employees offer affordable coverage to their employees or pay a penalty if they don't offer coverage, and have at least one full-time employee who receives a government-issued credit to purchase health insurance. And even if they do offer coverage, employers with 50 or more full-time employees will be penalized for not offering affordable coverage if at least one full-time employee is purchasing a subsidized plan through the health insurance exchange.

To learn more: Again, Community Catalyst offers a clear overview.

My family and I already have health insurance. What does the law mean for my coverage?

The simple answer: For now, probably nothing.

...but it's a little complicated: There will be some improvements to all insurance plans, like eliminating co-pays for preventive services including mammograms and wellness visits. Eventually, with 1.2 million additional New Yorkers expected to gain coverage through health reform, you'll see less of your health care premiums going to cover care for the uninsured. Fewer uninsured New Yorkers should translate to lower insurance premiums for everyone over time. But for now, most people who have insurance won't see radical changes, and you won't need to do anything differently to stay enrolled in your current plan. Longer term, some people argue that the law's provisions to improve the quality and efficiency of health care delivery will reduce costs even further, while others are skeptical about whether new approaches like accountable care organizations and health homes will be effective and save money.

So, yes, some of the answers aren't entirely simple -- all the more reason that New York State and the federal government need to devote more resources to inform the public about how the law will affect them. The State just submitted a proposal to the federal government for additional funding to get New York's Health Benefit Exchange up and running; the request includes money to help consumers navigate the new health care systems, and for consumer outreach and marketing. Those activities will be especially critical as the exchange gets up and running, when people are actually starting to enroll in new health insurance programs next fall. But for now, let's at least be clear about the basic parameters of the law and its practical impact on the New Yorkers who are still scratching their heads, wondering, "Wait, WHAT?!"