By Ayana Jones
Special to the NNPA from the Philadelphia Tribune
As a major insurer, Independence Blue Cross is gearing up to play a major role in the country’s healthcare reform.
During a meeting with The Tribune editorial board, IBC President and CEO Daniel J. Hilferty addressed the company’s role in extending healthcare coverage due to the Affordable Care Act.
In March 2010, President Barack Obama signed the Affordable Care Act into law which put comprehensive health insurance reforms in place.
Under the new law, most individuals who can afford it will be required to obtain basic health insurance coverage of pay a fee to help offset the costs of caring for the uninsured.
“This country needed health care reform. When 50 to 60 million Americans are without health insurance because they could not afford it or were accessing (care) through a clinic or through the emergency room, there needed to be a change,” Hilferty said.
“The Obama plan is the law of the land and we as a company are excited about implementing it. We see an opportunity, not only to bring folks who traditionally haven’t had access to care into care, but also to help people navigate their way through healthcare reform.”
Hilferty says majority of the costs associated with health care delivery are largely due to people accessing care through emergency rooms where the costs are higher.
“When you get everybody in an insured program, even though we’re paying more in taxes, you’ll have the ability to be better able to coordinate and manage the care of these individuals – get them in a patient-centered medical home with their own primary care physician. We’ll be able to increase the quality of care and drive down costs,” Hilferty said.
Under health reform, health insurers must pay a new premium tax in order to pay for many of the programs. According to Hilferty, IBC’s net tax rate will be 62 percent effective 2014.
This means that insurers like IBC will start charging some consumers more for coverage.
“There is going to be sticker shock because of all the costs that are associated with reform,” Hilferty said.
“Our biggest fear is that the backlash of these large premium increases will cause government – Congress and the president to say it’s time for a single-payer system,” he stated.
Under a single-payer system, a government run organization would collect all health care fees and pay out health care costs.
“So it’s in our best interests to (a) deliver a good product and (b) over a relatively short period of time, show that the cost burden is coming down,” Hilferty said, noting that approximately 20 percent of the country’s gross domestic product is committed to healthcare costs.
Due to health reform, Hilferty says it is anticipated that chronically ill people will flock to the healthcare system, as opposed to younger, healthier individuals.
Coverage is expected to be extended to millions of Americans by the expansion of Medicaid and the development of a new health insurance marketplace.
Under the ACA, states are able to receive federal matching funds for covering some additional low-income individuals and families under Medicaid. Applicants who earn less than 133 percent of the federal poverty level – approximately $14,000 for an individual and $29,000 for a family of four – will be eligible to enroll in Medicaid.
Every state will have a new health insurance marketplace, also called an exchange, that makes it easier for residents to gain coverage. The state exchanges will help individuals find coverage that meets their specific needs. Open enrollment in the health insurance marketplace will begin on October 1.
Beginning in 2014, new tax credits will be available that will reduce the cost of private health insurance for individuals and families.
A report recently released by Families USA, a consumer healthcare advocacy organization, estimates that approximately 896,000 Pennsylvanians will be eligible for new premium tax credits in 2014.
IBC is a leading health insurer in Southeastern Pennsylvania serving almost seven million people nationwide, including two million in the region.
Featured Photo: Daniel Hilferty is the president and CEO of Independence Blue Cross. -ABDUL SULAYMAN/TRIBUNE CHIEF PHOTOGRAPHER