Reform Update: Yes, workers, you can still get health coverage in 2014 despite employer mandate delay

Workers who find themselves out of luck, at least in 2014, in getting health coverage as a result of the administration's one-year delay in the employer mandate, don't have to fret.

That's because they will be able to get insurance through each state's individual insurance exchange, with the added bonus that if their annual income falls below 400% of the federal poverty level, they are eligible for subsidies. Not only does an exchange give these employees more choice then they would likely have with their employer, but they may end up paying less depending on how much in income tax credits they receive.

“For a lot of young workers like those in retail, where they might be working part-time … many of them are already not getting great coverage,” said Sabrina Corlette, project director at the Center on Health Insurance Reforms at Georgetown University's Health Policy Institute. “Frankly, for a lot of them, the deal (they will get) in an exchange is better than what they would get from their employer.”

As far as how the delay might affect the rest of the ACA, only time will tell; the administration is slated to release guidance this week. But experts interviewed by Modern Healthcare agree that the individual mandate is unlikely to be delayed because it's so critical to the law's success.

“One has to hope, however, that the administration has thought through the ramifications of this delay for the other provisions of the ACA,” Tim Jost, a professor at Washington & Lee University School of Law and a nationally recognized authority on the health reform law, wrote in a blog post Tuesday. “The statements say that implementation of the rest of the ACA, including the availability of premium tax credits, is going forward on schedule. From all appearances this is true. But tax credits are only available to employed individuals who are either not offered health coverage by their employers or are only offered employer coverage that costs more than 9.5% of household income or that fails to offer 'minimum value'—covering 60% of healthcare costs. Also, taxpayers are subject to the individual mandate penalty if they fail to accept coverage from their employer that meets the minimum value requirement and costs 8% or less of household income.”

But the damage to the ACA and the president may have already been done. President Barack Obama was facing an uphill battle getting exchanges ready by the Oct. 1 enrollment deadline and states were struggling to get consumer outreach programs ready. Even though the mandate delay only involves employers, many Americans may interpret it as a problem with the overall law.

As Arkansas works to implement a Medicaid expansion plan that relies on putting beneficiaries into the state's health insurance exchange, a new study says that the strategy could reduce the phenomenon of going between Medicaid and private insurance known as churn. The study, published Thursday in the New England Journal of Medicine, finds that “moving Medicaid beneficiaries into a new and untested marketplace raises large challenges even as it creates important opportunities.” The authors—Sara Rosenbaum of George Washington University School of Public Health and and Health Services and Dr. Benjamin Sommers of Harvard School of Public Health—write that the model allows states where Medicaid managed care has a limited footprint, including Arkansas, to enroll the large population of new enrollees into larger, more organized plans. “Such arrangements,” they add, “might improve enrollment stability and continuity of care, even in states with robust Medicaid managed-care markets.”

Following in the footsteps of UnitedHealthcare, Aetna this week said it was cutting its rates on small-group plans by 5% on the D.C. Health Benefit Exchange. Last week, United said it was cutting its small-group plans on the exchange by an average of 10%.

Follow Jonathan Block on Twitter: @MHjblock