Your Guide to the Health Insurance Marketplace

Healthcare, Living & Spending
on September 30, 2013

The Health Insurance Marketplace is uncharted territory for many Americans. But with the new Affordable Care Act (ACA), it’s something that everyone needs to know about.

Here are the basics you need to know in order to navigate the Health Insurance Marketplace (HIM) and find the best healthcare for your needs.

What is the HIM?

The Affordable Care Act, which takes full effect on January 1, 2014, says insurance companies can no longer deny coverage to individuals for pre-existing medical conditions and are prohibited from excluding essential benefits like maternity coverage. In addition, every American will be required to have some form of health insurance coverage, or pay a tax penalty if you elect not to have coverage.

To provide options for health insurance, each state is required to offer their own Health Insurance Marketplace for consumers to review the details of various plans and/or sign up for coverage. The HIM will be available to consumers via, telephone, and old-fashioned paper applications.

Various government offices and “navigators,” government employees, will be available online, on the phone and in-person to answer questions and help enroll Americans in healthcare plans. 

Is the HIM for you?

Think of the Health Insurance Marketplace like a virtual store operated by your state. Although you can’t pluck insurance policies off a shelf, beginning October 1, 2013, the HIM is a place where those not currently covered through an employer’s health insurance plan or currently enrolled and receiving coverage under a government-sponsored plan such as Medicare, Medicaid or VA Benefits can “shop”  for health insurance, says Carrie McLean director of eHealthInsurance Call Centers.

However, even those with insurance might want to shop the HIM.

“If you currently have individual health insurance purchased on the private market you should shop the HIM for coverage,” says Joel Winston, general counsel, and former Deputy Attorney General of New Jersey. You may be able to obtain health insurance at a more affordable price than what you’re already paying.

You might pay more, too.

Monthly premiums will be determined by age, family composition, geographic location, tobacco use, level of coverage, the insurance company plan chosen, plus tax credits applied, says McLean. Insurance carriers will be competing for your business, but that competition will vary by state. Those with fewer competitors might not see rate reductions or a lot of options. And the anticipated risk for exchange coverage is projected to be high, so premiums will reflect that risk.

Get to know your subsidy

McLean says subsidies will be available to help people buy coverage. “Those earning between 133 to 400 percent of the Federal Poverty Level (up to about $45,000 for a single person or $92,000 for a family of four) will qualify for a subsidy.”

Depending on where you fall in the Federal Poverty Level income range, the subsidy will limit your premium costs to between 3 percent and 9.5 percent of your income.

Subsidies can get complicated, however.

“The amount of your subsidy is based on your income level, but it’s also pegged to the value of the second least expensive “silver” plan available in your area. This means that choosing a more expensive plan (like a gold or platinum plan) doesn’t increase the dollar amount of your subsidy,” says McLean.

Keep this in mind when considering different health plan options.Also keep in mind that the amount of government subsidies that you’re eligible to receive could change mid-year if you get a new, higher paying job or if your overall household income increases through a spouse entering the workforce.

Don’t expect dental

It’s estimated that currently, 47 percent of Americans are without dental insurance, and this number is expected to increase by 5 percent after the ACA is in full effect. In some instances, dental coverage will be increased for children, but adults without dental coverage will not find dental insurance via the HIM.

Should you ask for help?

Although navigators will be available to answer questions and help enroll consumers, you can do your own homework and research plans. That includes talking to a qualified insurance salesperson, contacting your state insurance commissioner’s office or surfing a licensed online marketplace.

To see your options, visit the Health Insurance Marketplace.

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