Questions and answers about the Affordable Care Act

SMALL BUSINESSES

Q: What does Obamacare mean for businesses with 100 or fewer employees?

A: In some cases, if they currently offer health insurance and want to keep that plan, they may be grandfathered in. Grandfathered plans would remain as they are and be exempt from certain Affordable Care Act requirements, including:

Having to cover preventive care services without cost sharing;

Having to offer new minimum health benefits;

Providing an appeals process for coverage decisions.

Q: Will businesses with fewer than 50 employees have to offer health insurance?

A: No. And if they don't, they will not have to pay a penalty.

But if they want to, they are eligible to purchase health plans to offer employees through the insurance marketplace for businesses, SHOP, the Small Business Health Options Program. They also can buy on the open market. In either case, businesses can use a broker, and that may be advisable due to the complexities of insurance.

Q: How are businesses with 25 or fewer employees affected?

A: Again, such businesses do not have to offer health insurance plans.

However, under certain conditions, small businesses with 25 or fewer employees that do offer a health plan are eligible for two years of sliding-scale tax credits equal to up to 50 percent of the total premium cost, starting Jan. 1, 2014; until then the credit is 35 percent. The conditions are:

The business must contribute 50 percent or more toward the total health care premium;

The average annual wage of its employees is less than $50,000;

The plans must be purchased through SHOP.

Worth noting

Businesses that offer health insurance and have 10 or fewer employees with average annual wages of $25,000 receive the full

tax credit.

Businesses with Blue Shield and Blue Cross can renew their plans early, if they have two to 49 employees. That would allow them to avoid dealing with redesigned plans, incur minimal rate increases and perhaps lock in lower rates for a period. The deadline for businesses with Blue Shield to renew early is Oct. 7. The deadline for businesses with Blue Cross is Nov. 15.

INDIVIDUALS

For individuals, the most important thing to know is that everybody must buy insurance or else pay a penalty.

You must obtain insurance, either through your employer or, if they do not offer it, through the Covered California exchange or a broker.

Q: What do I do if I don't have insurance? Can I sign up for Medi-cal?

A: Individuals who earn up to $15,856 annually — or 138percent of the federal poverty line —

can enroll in Medi-Cal, the government health insurance program for low-income people.

The new law will dramatically expand the number of people who are eligible for Medi-Cal. Before Obamacare, eligibility was limited primarily to specific low-income people, for example children, pregnant women and the disabled. Under the Affordable Care Act, income (and legal status) are the sole criteria for eligibility.

Also, the current rule that people are not eligible for Medi-Cal if they have more than $2,000 in assets will be eliminated.

Undocumented immigrants are not eligible; nor are they eligible for insurance purchased through the exchanges.

Q: I make too much money to get on Medi-Cal. Can I get a subsidy to lower the cost of buying private insurance?

A: Tax credits will be available to individuals up to the age of 65 and families that earn between 139 percent and 400 percent of the federal poverty line. For individuals, that means an annual income of up to $45,960, and for families, an income up to $94,200.

The tax credits will cover

up to 70 percent of the costs on mid-range plans

. The size of these tax credits, or discounts, are tied on a sliding scale to income, limiting the amount of premium that individuals or families pay to a certain percentage of their income.

For example, someone who earns between $17,235 and $22,980 (150 percent to 200 percent of the federal poverty line) will not pay more than 6.3 percent of their income annually toward insurance.

Those individuals and families who earn less than 250 percent of the federal poverty level also are eligible for sliding-scale subsidies to lower their upfront costs, such as co-pays, deductibles and out-of-pocket limits. For example, someone who earns between $17,235 and $22,980 a year will qualify for subsidies equal to 87 percent of their upfront costs.

Q: What are the penalties for not buying insurance?

A: They are in the form of taxes. They will be phased in and will start at a flat fee of $95a year for a family, or 1 percent of household income, whichever amount is greater.

In 2016, they will reach a level of between $695 and $2,085 per family, or 2.5 percent of household income, whichever amount is greater.

Q: What if I already buy insurance?

A: The only thing that will change is your health plan will be required to offer certain benefits that they may not currently provide.

That may change the price of the plan

.

Q: What happens if I'm on Medicare?

A: There are no benefit changes for Medicare patients.

Q: What minimum services will health insurance plans have to offer?

A: They are known as essential health benefits and they are:

Ambulatory patient services;

Emergency services

Hospitalization

Maternity and newborn care

Mental health and substance-use disorder services, including behavioral health treatment

Prescription drugs

Rehabilitative and habilitative services and devices

Laboratory services

Preventive and wellness services and chronic disease management

Pediatric services, including oral and vision care

Q: I'm uninsured. Where I will buy insurance?

A: You can shop on the online state-run exchange, Covered California, which is recommended if you earn between 138 percent and 400 percent of the federal poverty line because you qualify for a subsidy.

You also can shop for your health insurance on the private market just as you can now, through brokers and insurance agents. However, again, if you qualify for a premium credit or subsidy, you can only obtain those if you buy your plan in the Covered California exchange.

Q: If my employer offers insurance already, can I go on the new Covered California exchange to see if I can get a better deal?

A: Yes. But you will not be eligible for any tax credits, unless the premiums you pay for your employer coverage are greater than 9.5 percent of your household income.

Q: Can I enroll at any time?

A: No. You can only enroll during the open enrollment period, which runs from Oct. 1 to March 31, 2014, for the launch. However, if you lose your job or move, you can still enroll for insurance.

— Jeremy Hay