The federal government is closed, and the Affordable Care Act is open.
The Republican-controlled U.S. House of Representatives approved a federal budget proposal that included the defunding of the ACA, otherwise known as Obamacare. The Democratic-controlled U.S. Senate and President Obama rejected that proposal and accused the Republicans of holding the country legislatively hostage to appease the extreme Tea Party wing of the GOP.
Meanwhile, the ACA went live this morning, allowing individual citizens to begin shopping for health care insurance through the online available at www.healthcare.gov. Employers with more than 50 employees have been given a one-year exemption to decide whether to “pay or play.”
Small businesses, with fewer than 50 employees, will need to wait until November to enroll in the Small Business Health Options Program (SHOP). The exchanges for individuals and small businesses will take effect Jan. 1.
With the new law, patients can no longer be denied coverage because of pre-existing conditions, women cannot be charged higher rates for coverage, care cannot be denied because of maximum benefit limits and children can remain covered under their parents’ plans until age 27. Individuals who do not receive insurance through their employers or parents must comply with the individual mandate and purchase insurance through the exchanges or pay a fine through their income taxes.
At first glance this morning, the experience of individuals inquiring at the federal web site for the exchanges was dependent upon which state they were from. Wisconsin residents received a “please wait” message, presumably because of heavy volumes of traffic at the site.
Wisconsin’s residents are being served by an exchange established by the federal government because Gov. Scott Walker rejected federal funding to establish a state-run exchange.
By contrast, Minnesota accepted federal funding and established its own exchange, called MNsure. Minnesota’s web site was up and running this morning.
Meanwhile, Minnesota officials are touting their new competitive advantage over Wisconsin in health care. Walker also rejected several million to expand Medicaid in his state, while Minnesota accepted the additional federal funding, allowing it to cover thousands of working poor people who otherwise would have been uninsured.
The federal government recently released the average health care insurance premium rates for 47 states. Minnesota’s average monthly premium across all age groups will be $192, the lowest among all of the states. Wisconsin residents will see average monthly premiums of $361, which is 88 percent more than Minnesota’s rate.
“State-based health insurance marketplaces like MNsure make sense for more reasons than just low rates, however. When there’s a problem, it is good to know we can dial a local number, not one with a Washington, D.C., area code,” said Minnesota State Rep. Joe Atkins (D-Inver Grove Heights), who was the chief author of the Minnesota exchange law. “If we had done nothing and allowed the federal government to put in a top-down exchange — every Minnesotan using MNsure would be paying more and getting less, just like Wisconsin residents are now seeing. By keeping it local, Minnesotans will not only have the best health care in the nation, they will also have the lowest costs in the nation. This is great news for individuals, families and small businesses who have struggled to get affordable insurance for years.”
Meanwhile, the shutdown of the federal government will cost the United Sates at least $300 million per day in lost economic output, according to an estimate by Lexington, Mass.-based HIS Inc.
“Closed” signs and barricades were erected this morning at the national monuments in Washington, D.C., and at national parks throughout the country. Several federal agencies, including NASA and the Environmental Protection Agency, were virtually shuttered today.
“The longer the shutdown, the more damage will accrue to business and consumer confidence,” Eric Green, New York-based global head of foreign exchange, rates and commodities at TD Securities USA LLC, wrote in a note today. “A longer shutdown stretching into mid-October, when the Treasury estimated that the debt ceiling will need to be raised, would likely magnify the hit to economic activity by raising the risk of a bad outcome on the debt ceiling.”
