Health Overhaul Signups

Tens of thousands of Louisianans who buy health insurance on the federal marketplace could save hundreds of dollars while some low-income residents will pay nothing under provisions of the latest federal coronavirus relief package.

Tens of thousands of Louisianans who buy health insurance on the federal marketplace could save hundreds of dollars while some low-income residents will pay nothing under provisions of the latest federal coronavirus relief package.

Winners include those covered under the Affordable Care Act, known as "Obamacare," or who are just now signing up for it through a May 15 deadline. Self-employed people who buy their own insurance and don't currently get federal help could be eligible for subsidies. The package also benefits laid-off workers struggling to retain employer coverage, and most anyone collecting unemployment.

"It's a total gamechanger," B. Ronnell Nolan, president and CEO of the Health Agents for America, said of a percentage of income cap placed on health care premiums that allows subsidies for many middle-income policyholders for the first time under the decade-old Affordable Care Act. "For them there was nothing affordable in the Affordable Care Act exchange. It's going to be huge in Louisiana," Nolan said.

Many individuals who didn't previously qualify for subsidies on the HealthCare.gov exchange are small business owners, Nolan said.

"The message I'm getting from my (independent insurance) agents and brokers is that they are getting a lot of calls every day," Nolan said. "Now there is an opportunity to make a change."

The $1.9 trillion federal relief package was approved this week by Congress and signed Thursday by President Joe Biden.

It was not immediately clear how many policyholders in Louisiana will benefit from an increase in federal health care tax credit subsidies, but 91% of policyholders, or 70,758, in the federal marketplace were receiving advance premium tax credits in 2020 across the state.

Nationally, there are 11 million individuals with health care coverage through the exchange. Several million people nationwide stand to save hundreds of dollars each on health care costs, but there are still upwards of 33 million Americans who are uninsured. 

The temporary premium tax credits — put into effect for the next two years, retroactive to Jan. 1 — would ensure that no individuals buying federal marketplace health insurance would spend more than 8.5% of their income on premiums — meaning some policyholders will qualify for a health care subsidy for the first time since Obamacare began. Subsidies have been expanded to those earning more than 400% of the federal poverty level, lifting income levels to $51,520 for an individual and $106,000 for a family of four, whose payments exceed the 8.5% of income cap.

A hypothetical 45-year-old making $58,000 previously got no aid under the Affordable Care Act. With the new bill, they'd be entitled to a $1,250 tax credit, or 20% off their premiums, according to the Congressional Budget Office. 

Subsidies also have been expanded for those who have incomes that are low but not low enough to qualify for Medicaid, the federally subsidized program for the poor that covers nearly 1.8 million people in Louisiana, or about 39% of the state's 4.6 million residents as of November 2020. Annual income to get Medicaid in Louisiana is capped at $17,784 for an individual adult.

Top stories in Baton Rouge in your inbox

Twice daily we'll send you the day's biggest headlines. Sign up today.

A single 45-year-old earning $18,000 a year, who makes too much to get Medicaid and has been paying an average $54 a month for marketplace coverage, will no longer pay monthly insurance premiums, according to an analysis by the Center on Budget and Policy Priorities.

A family of four with total household income of $39,000 would also pay no premiums after subsidies are applied.

In another change, the federal government is picking up the insurance premium for COBRA coverage, which is employer-sponsored health care that laid-off workers typically pick up and fully pay for after they lose their jobs. The government will now pay the tab until September 2021. That move would make a big difference because for those earning more than 400% of the federal poverty level it's cheaper to continue with existing COBRA coverage than to sign up for an individual marketplace plan, Nolan said.

The legislation also includes a provision where individuals on the exchange whose income was higher than they projected would not be penalized. This means unemployed residents who earned more income than projected due to economic stimulus payments they received are not required to pay back subsidies.

Here are more examples of federal marketplace savings under the federal relief package provisions:

  • A 45-year-old in Louisiana earning $60,000 and paying on average $616 monthly for insurance would only pay $425 when subsidies are applied.
  • A 60-year-old couple who earns $75,000 and pays on average $2,315 for insurance premiums each month would only pay $531 for health care when subsidies are included.
  • A family of four with household income of $120,000 would pay $850 each month instead of $1,743. 

There were 84,902 individuals enrolled in Obamacare health plans as of early March, but more are expected with the enrollment period extended until May 15 and the relief package provision in place. 

“This special enrollment period could make a meaningful dent in the number of people uninsured” nationally, said Larry Levitt, who tracks health insurance for the nonpartisan Kaiser Family Foundation. “The enrollment numbers so far are stronger than I would have expected.”

Acadiana Business Today: Thousands in Louisiana will pay less, some even nothing, for Obamacare; see some examples


The Associated Press contributed to this report.

Email Kristen Mosbrucker at kmosbrucker@theadvocate.com.