Insure Oklahoma companies steel themselves for program's demise
Key health care reform mandates loom Jan. 1; threaten the end to state's premium assistance program for low-income employees of small companies.
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At a glance
What is Insure Oklahoma?
Established in 2005, Insure Oklahoma provides premium health insurance assistance to businesses with 99 or fewer employees and self-employed people by using state tobacco tax revenues matched with federal funds. Employees must meet age and income requirements, be Oklahoma residents, meet citizenship guidelines and pay part of the premium payments. Workers pay about 15 percent of the premium, while the employers pay 25 percent and Insure Oklahoma pays 60 percent. Spouses also may qualify through the program. About 30,300 Oklahomans are enrolled, and 4,789 small businesses are participating, representing all 77 counties in Oklahoma. For more information, go to www.insureoklahoma.org or call (888) 365-3742.
New mandates are coming
• Beginning Jan. 1, 2015, individuals must have health insurance or pay an annual penalty of $95 or 1 percent of income; $695 or 2.5 percent of income by 2016.
• Businesses of 50 or more full-time equivalent employees must offer health insurance or pay annual penalties of $2,000 per full-time employee, excluding their first 30.
• Fines can be $3,000 per employee if a company's insurance is deemed inadequate (covers less than 60 percent of essential benefits) or unaffordable (costs more than 9.5 percent of a worker's salary, or $117.67 monthly for a minimum-wage worker).
• Legal residents between 100 percent of federal poverty level ($11,170, or $19,090 for a family of three) and 400 percent can buy health insurance through state- or federally-operated exchanges and be eligible for variable tax credits based on annual income and family size.
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Yet, she said, analysts agree it's only at or below an annual income of $58,875, or $94,200 for a family of four, that the Affordable Care Act's subsidies make exchange coverage, on average, as good as or better than employer-sponsored health plans.
Medicaid expansion supporters
Meanwhile, David Blatt, director of the Tulsa-based Oklahoma Policy Institute, and State Rep. Doug Cox, R-Grove and an emergency room physician, continue to lobby for the expansion of Medicaid in the state.
“We don't know for certain what the federal government will decide (regarding Insure Oklahoma),” Blatt said. “There may be some flexibility with buy-in to the employer plans, though it's hard to see the individual plans continuing.”
“Still, I think we can use the Insure Oklahoma budget to cover far more than the allowed 35,000 participants,” Blatt said. “Why would we turn down 90 percent to 100 percent funding from the federal government to expand our Medicaid program versus pay fully one-third of the funding for Insure Oklahoma?” he said. “That doesn't make sense.”
“We need to allow additional Oklahomans into Medicaid. It's not about entitlement, but hardworking people who can't afford insurance,” Cox said. “They're doing low-wage jobs for small companies.”
Small employers can benefit
In Oklahoma City, Shield Manufacturing, which sells plastic film for meat products, and Gold Star Graphics screen printing and embroidering firm are among those small companies.
Because of premium reimbursements under Insure Oklahoma, Shield Manufacturing was able to reset its deductible in 2010 and 2011 from $500 to $1,000 said Kathleen Oliver, who employs fewer than 10 workers.
Today, Oliver, who has no current Insure Oklahoma participants, is considering raising the deductible again to offset rising insurance costs.
Meanwhile, Insure Oklahoma saves Gold Star some $500 a month, owner Pam Guffey said. Of her 16 employees, two qualify for premium assistance, she said.
Premiums this year were scheduled to go up 14 percent, but Guffey reduced the increase to 7 percent by moving from a 80/20 co-pay to a 50/50 co-pay, she said.
Though Guffey the past two years has taken advantage of new tax credits for small employers who offer health insurance under health care reform, she said she remains “very skeptical” about health care reform and the key mandates coming in January. “I just don't understand what will happen,” Guffey said.
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