FOX 8 Special Report: Shopping For Your Health, Part 2 - FOX 8 WVUE New Orleans News, Weather, Sports

FOX 8 Special Report: Shopping For Your Health, Part 2

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NEW ORLEANS - In a state where nearly 800,000 people have no health insurance, according the federal government, not being able to afford coverage is an everyday reality for a lot of local residents.

"No, definitely not, definitely not," said Gabriella Garcia about the affordability of health insurance.

The now-open Health Insurance Marketplace allows millions of Americans to not only shop for insurance, but also find out if they are eligible for lower costs through the marketplace. Come January 1, 2014, most Americans must have health insurance.

An estimated 353,000 Louisiana residents are eligible for premium subsidies, according to the organization Families USA.

Subsidies for low- and mid-income people are called advance premium tax credits. They are for individuals and families with incomes from 100 percent to 400 percent of the federal poverty level. When an application is made in the marketplace, consumers must estimate what their 2014 income will be. Qualifying income levels for the premium tax credits range from $11,490 to $45,960 for an individual, and for a family of four it is $23,550 to $94,200.

The unsubsidized premium for someone in New Orleans whose earnings are at 100 percent of the FPL would be $2,768, according to the Kaiser Family Foundation and Healthcare.gov.

However, with a tax credit of up to $2,538, the annual premium falls to $230.

For a family of four earning $50,000, without a tax credit the annual premium would cost $5,535. But with a premium subsidy of up to $2,170 the family would be responsible for $3,365 a year.

"If you're at the lower end of that, the subsidies are fairly generous, but you're still going to have some out-of-pocket," said UNO Professor Walter Lane, Ph.D., who is considered an expert in healthcare economics.

There is a second subsidy, known as cost-sharing, that reduces the cost of deductibles and co-pays for people with incomes up to 250 percent of the poverty level.

But subsidies will not land in consumers' bank accounts.

"It's paid to their insurer, whichever insurer they choose on the exchange," said Louisiana Insurance Commissioner Jim Donelon.

The health care reform law requires everyone buying insurance through the marketplace to contribute a portion of their income to the premiums. And that leaves some low-income Louisianans in a bind when it comes to qualifying for subsidies.

Keina Willis makes less than $10,000 a year from the part-time job she has, and she has no health insurance.

"I just put all my asthma medicine aside in order to just get the [blood] pressure medicine, and if I had an asthma attack, I would go straight to the hospital. Didn't care if they billed me, as long as they treated me," Willis said.

As a result, she said she owes a local hospital more than $60,000.

In the days leading up to the opening of the insurance marketplace, Willis went online to check to see if she would qualify for a subsidy to buy insurance. But the answer was no because her income is below the poverty level. When the health reform law was passed, it counted on people like Willis benefiting from an expansion of Medicaid eligibility, but because she resides in a state that is not expanding its Medicaid eligibility to include more of the working poor, Willis and many others are part of the so-called "coverage gap," and will likely remain uninsured.

"Sometimes I get myself worked up, my pressure goes up and everything," Willis said, with tears in her eyes. "I can't afford the medicine, but then I'm going to get sick enough to go to the hospital, but I can't pay them."

The federal government will give states funds to cover the cost of expanding Medicaid eligibility for adults.

Meanwhile, the White House is counting on those who are eligible to purchase insurance through the marketplace to sign up in large numbers in order to make the system affordable for everyone.

"The goal of expanding to near-universal access and using the private market depends on those who are uninsured participating to bring the overall cost of premiums down for everybody," said Mollye Demosthenidy, of Tulane University's School of Public Health.

The marketplace will report to the IRS the type of insurance you buy and the amount of premium tax credits and subsidies, where applicable. If your income increases during the year, you could end up owing Uncle Sam.

"CPAs are pulling their hair out in anticipation of having to handle that additional complex part of the tax return going forward," said Donelon.

If you are self-employed, you can shop the marketplace. Brandon Lennert owns a screen printing shop and plans to do so for insurance for him and his wife. Right now he is paying $400 monthly.

"That would help a lot. If it could cut some slack that would be great, absolutely," Lennert said.

He will also explore the Small Business Health Options Program, known as SHOP, when it opens online in November to compare rates he now pays to insure his nine workers.

"I'm always going to be curious about what is out there, and second of all, it needs to be done. There should be a marketplace for everyone to go and check into insurance," said Lennert.

If you are turned down for a subsidy in the insurance marketplace, you can appeal. You can also buy insurance outside of the marketplace, but the benefits must live up to the new federal requirements, or you could face a federal fine.

Online application is not the only way to apply for insurance through the marketplace. Enrollment by mail or in person is available.

Louisiana, like other states, has people specially trained to help individuals navigate the process. Click here to find assistance in your area.

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