A snapshot of the Health Insurance Partnership [Jan. 2008]

A Snapshot The Health Insurance Partnership
A SNAPSHOT OF

The Health Insurance Partnership

Overview

Eligibility

The Health Insurance Partnership (HIP) proposes to increase access to

Criteria for

affordable health insurance by providing incentives to eligible employees of small businesses or who are sole proprietors. The cost of the health insurance is

Employers

shared by the employee, employer and government. This incentive is available to employees and sole proprietors and their families whose household income is less than 300 percent of the Federal Poverty Level (FPL), which is approximately
$60,000 a year for a family of four.

Business is located in Georgia Employs 50 or less employees or a sole proprietor Commits to paying half of the

net premiums of the selected

Who can participate in the program?

insurance option (net the

government incentive)

The initial design of the program will seek to provide incentives to individuals and their families who are employed by a small employer, defined as employing less than 50 full-time employees, or a sole proprietor and whose family income is less
than 300 percent of FPL (approximately $60,000 a year for a family of four).

Offers insurance to all eligible employees Matches any state contribution made to a health savings account

Has not offered coverage

Coverage Options

within the last six months

Maintains their current

Three coverage options will be available. Employers must offer at least the benchmark plan.
Benchmark Benefit Plan

contribution level for a period of 12 months, if greater than minimum contribution required

This plan is comparable to the State Employees Health Plan based on the PPO coverage without dental. This is the most comprehensive option. Basic Benefit Package

by the state, when opting for the HIP product Agrees to participate for at least one year

The basic benefit package meets the requirement of SB 174 Health

Insurance Mandate. This package includes minimum coverage but is

not limited to medical benefits, complications of pregnancy, general anesthesia, cancer treatment for children,

select preventive screening services and child wellness exams.

High Deductible Health Plan (HDHP) with a Health Savings Account (HSA)

A HDHP has higher deductibles to be paid by the member, most of which can be paid using the HSA.

The employer must match the state contribution to a health spending account, if that option is offered.

Contributions may be made by the employer, the employee or both. Unlike flexible spending accounts, if

the funds are not used during the year, the contributions are rolled over and may be used the next year.

Deductible amounts and contribution limits are updated annually by the federal government.

For 2007, HDHP minimum deductible is: $1,000 for single coverage $2,000 for family coverage
For 2007, HSA maximum contribution is: $2,850 for single coverage $5,650 for family coverage

2 Peachtree Street, Atlanta, Ga 30303 www.dch.georgia.gov

January 2008

A Snapshot The Health Insurance Partnership

How many individuals will be eligible for the program?
Based on information from Georgia State University (GSU), there are 108,588 employers in Georgia with 50 or fewer employees. They have a total of 967,000 employees. An estimated 47 percent of those employers currently offer coverage to at least some of their employees. Approximately 58,000 firms, employing 358,000 workers, do not offer coverage. In Georgia, about 35 percent of the workers of small firms earn less than $35,000 and the distribution by firm is unknown. Assuming that 85 percent of small employers meet that requirement, approximately 49,000 firms employing 304,000 workers would be eligible for a small business insurance program targeted to this population. Georgia estimates that 90,000 self-employed Georgians would meet program guidelines. For simplicity purposes, the model rounds the anticipated universe of potential eligibles to 380,000 employees and sole proprietors.
Enrollment Cap
Enrollment will be limited and subject to appropriations. Enrollment may increase in future years if additional appropriations are provided.
Funding Sources
Employee's share of premium Employer's share of premium State Funds and Federal Medicaid Match
Incentive will not exceed one-third of the estimated premium

Eligibility
Criteria for
Employees
Family income less than 300 percent of the FPL, which is approximately $60,000 a year for a family of four Employed by a small business with less than 50 employees or is a sole proprietor Works a minimum of 20 hours a week Resident of Georgia Citizen or qualified legal alien Has not had health insurance coverage in the past six months Commits to paying at least half of the net premium of the selected insurance option after the incentive

Is there a minimum premium the employer must contribute?
Employers will be required to contribute at least half of the net premium for the employee. Net Premium is defined as the premium for the selected product, less the government incentive. If the employer currently contributes more than the minimum, the employer must maintain the higher contribution level for a period of 12 months. The employer must match the State contribution to a HSA, if that option is offered.
How much will employees have to pay for coverage?

Excluded
Individuals
Spouses with access to health insurance coverage through their employer even if he/she chooses not to enroll State employees Individuals covered by Medicare or TRICARE Non-residents of Georgia

This will depend upon the plans offered by your employer, age of the member, and the number of persons covered. In general, employees will have to pay up to half of the net premium. Employees may have to pay more for family coverage if the employer only contributes to employee health insurance coverage. Premiums may also vary based on the age of the employee. Plans may charge more to people who smoke or use smokeless tobacco.

When can I enroll?

The anticipated start date is July 2008. The implementation is contingent upon funding including: appropriations from the state Legislature and approval from the federal government.