Health Care MarketplaceNews & Research

How to Choose a Health Insurance Carrier

Choosing a health insurance carrier in the healthcare marketplace can be a confusing and difficult process, especially if you don’t get insurance through an employer and have to rely on other means for coverage. The Affordable Care Act (ACA or Obamacare) opened up access to more options for major medical coverage, but more options can mean a bigger headache when it comes to finding the right health plan. How do you choose a carrier? Where should you even start? Let’s take a look at your options and how to pick an insurance company that’s right for you.

What Insurance Do You Need?

You can’t predict your next medical crisis – oh that we could – but you can prepare for it with proper health insurance. Without any coverage at all, you risk paying all medical bills out of your own pocket. A doctor visit for a minor problem might cost $68 while visit requiring more in-depth care could cost around $234. And these are just the office visits. These costs don’t take into account things like lab testing, imaging services and complex surgery, which could bankrupt the average American family without any savings. Even if you’re healthy, accidents can happen that demand visits to a doctor, emergency room or walk-in clinic.

When looking at an insurance carrier, you want to choose one that offers the coverage you need for you and your family. Consider how likely you are to need routine care as well as emergency care. Families with children, for instance, would need greater coverage since kids are more likely to end up in a hospital with broken bones or suffer a gamut of illnesses during fall and winter. Your insurance carrier should provide good coverage for these expected and unexpected medical costs.

Premiums vs. Out-of-Pocket Costs

One important factor to consider is the premium costs you’ll pay compared to out-of-pocket expenses. Private health plans might have lower premiums, but they could have high deductibles and copays to compensate. A policy that has higher out-of-pocket costs could mean that a minor illness will result in you paying most of the charges out of your own pocket with insurance covering very little. Once your deductibles are met, the insurance begins paying, but it could take some time to reach that deductible.

Higher premiums mean lower out-of-pocket costs, so keep this rule in mind when shopping for coverage. Carriers set pricing using their own formulas, and it pays to compare cost details. Read the plan overview and ask questions if you’re not sure how a company structures its pricing. You don’t want to get stuck with a low-cost plan if it doesn’t cover anything you need.

Company Reputation

All companies that sell insurance are strictly regulated by the state in which they’re licensed to sell. Any carrier selling health plans in the Obamacare marketplace for 2019 must meet certain criteria. But not all companies have the same level of service when it comes to handling claims, answering questions or addressing concerns. Accidents and illnesses always seem to happen outside regular business hours. This means you may need to reach someone on a weekend or late at night for questions of coverage and benefits. Make sure the carrier you choose has flexible hours and can be reached when needed.

You also want to verify that claims will be paid on time. Until the insurance company pays, you’re responsible for the bill. If payment runs 30, 60 or 90 days late, you could face collection activity from the healthcare provider. The National Committee for Quality Assurance (NCQA) provides a database of insurance carrier ratings that allows you to research information on the carriers in your state.

 

Appeals Process

At some point, you may have a claim that gets denied by the insurance company. It could be an emergency room visit that the company determines was not an emergency or a claim that was improperly coded by the doctor. When this happens, you may need to file an appeal with the carrier. Companies handle this process in different ways. Choose a health insurance carrier that makes the appeal process simple and applies the process fairly. One way to be sure claims will be handled as you expect is to read the fine print in your policy to confirm that you have the right coverage. Small loopholes in wording could lead to claim denials that will also be denied on appeal.


Coverage Offered

Once you’ve narrowed down your search to a few different carriers with a strong reputation, you want to determine which companies offer the coverage that best suits your needs. You’ve got more options for health insurance in 2019 than you did last year, thanks to some changes from the Trump administration. Major medical coverage will continue to cover 10 essential health benefits, so know that any ACA-compliant plan available today will include a bevy of benefits that could work for you.

If you don’t need or want, or can’t afford, major medical insurance, new regulations make it easier in most states to buy short term health insurance that lasts up to 364 days and can be renewed for up to 36 months. Consider your health needs carefully before forgoing major medical, though. Short term coverage doesn’t work for everyone, and there are plenty of good reasons to buy traditional health insurance.

When comparing insurance carriers, note the benefits that are important to you – like maternity care or prescription drugs – and see how each company handles those benefits. One may provide more generous coverage, or one might require less cost-sharing on your part. If several carriers offer the same level of coverage for the benefits that matter most to you, then choose the company with a better reputation for these services.

Pre-Existing Conditions

Under Obamacare, health insurance providers are required to cover pre-existing conditions as part of major medical benefits. This means that if a member of your family suffered an illness or injury at any time in their life, treatment for that condition must be covered in major medical plans offered on and off the marketplace in 2019. We should note that short term health insurance doesn’t have to abide by this rule. But as long as what you’re buying is a major medical policy from a legitimate source, your pre-existing condition – whether it’s acne, high blood pressure or cancer – must be covered by law.

Networks

One way that health insurance companies keep premiums low is to require you to use certain doctors, hospitals and healthcare facilities – all part of a “network” of providers. When you’re comparing policies and carriers, pay attention to network limitations. Some plans, like PPOs, allow you to see providers outside the network, but it costs more money and may not be covered as well as in-network care. Other plans, like HMOs, may not cover any out-of-network care. If you have doctors or providers who you see regularly and like, make sure that your insurance carrier covers those providers. If not, you might face higher costs or have to pay the full bill yourself, which renders health insurance useless.

You have lots of options for health insurance, both major medical and short term, and picking a plan from a carrier isn’t always as black-and-white as it could be. But the process doesn’t have to be stressful. With proper planning and careful consideration, you should be able to choose a company that will provide you with the major medical you need at a cost you can afford without any hidden surprises down the road.

How Do I Buy Major Medical Insurance?

Whether you’re a young adult branching out from a family health plan or a working adult new the insurance marketplace, buying major medical insurance is a very important decision. But a combination of complex regulations, government bureaucracy and the large number of options can make the process of buying major medical insurance confusing and difficult. The simple answer of how to buy health insurance is: Shop for a plan, pick one and pay for it.

Unfortunately, it’s not always that black and white, especially since you have plenty of options for healthcare coverage under the Affordable Care Act. Not sure where to start? Here are some things you need to know about buying coverage.

Obamacare 2019

During the last presidential election, there was a lot of talk about ending the Affordable Care Act (ACA), commonly known as Obamacare. After a lot of back and forth in Congress, conservative lawmakers weren’t able to pass any legislation eliminating the ACA for good. That means that for this year and the foreseeable future, Obamacare remains the law of the land for health insurance.

However, some important changes have been made to how major medical plans work that will take effect in 2019. One big difference is that the tax penalty for not holding health insurance (known as the individual shared responsibility payment) will be zeroed out starting January 1, 2019. The mandate to have minimum essential coverage itself still exists, but since there’s no longer a penalty attached to it, it’s going to be even more ineffective at persuading people to buy health insurance than it was before.

The Trump administration has also made changes to short term health insurance plans. While these don’t count as major medical plans and aren’t a good substitute if you need comprehensive coverage, temporary plans serve a purpose in the health insurance industry. Under current regulations, these plans can now last for “less than a year” nationwide, and you can renew them for up to 36 months. Individual states may set tighter limits on short term plans, though.

Before you shop for health insurance on the private market, make sure you exhaust your options for other coverage. Your job may offer a health plan, or you or your children might qualify for your state’s Medicaid program and/or CHIP. We don’t say this to drive you away – we sell health insurance, after all – but to make sure you have a good understanding of what’s out there. Your work-based coverage might be too expensive, or you just might not like the options that you do have. In that case, a private plan could be the solution you’re looking for.

Where to Buy

If you’re not sure how to buy health insurance, then you may also be wondering where to start looking for a plan. You’ve got four categories of options for shopping: a public marketplace, agents or brokers, an insurance company directly or a private marketplace (like ours). We’ll highlight the features of each below:

  • Public marketplace: Also referred to as a “health insurance exchange,” a public marketplace is one created by the Affordable Care Act. Most states use the federal one at HealthCare.gov, but 11 states and the District of Columbia have created their own state-based exchanges. Government marketplace plans are the only ones that qualify for cost savings, but you don’t actually need to buy them from the marketplace to get the savings. You can use an independent broker, agency or third-party site like this one to buy an on-exchange plan with savings (if you qualify).
  • Agents or brokers: You probably know that insurance agents and brokers exist. You might even know one personally. Agents work directly with companies to sell their health insurance plans. Brokers work with more than one carrier, usually. Because agents and brokers represent specific companies, you’re less likely to get unbiased advice from them about carriers they don’t represent. But you can work with these people for free since they get paid from the carriers.
  • Insurance company directly: If you know you want to buy from a company directly, you can do all of the legwork yourself to buy a health plan directly from it. Many have online portals of their own now for consumers to use to shop. Just know that you’re not going to get any information about plans from competitors (naturally) if you go straight to a carrier site to get insurance. You risk missing a better plan if you don’t compare your options from multiple carriers.
  • Private marketplace: Private health insurance marketplaces let you compare different plans from different carriers. You’re reading this article on a private marketplace. The benefit of this approach is that you can see multiple options at once, and there are agents available to walk you through your options. We’re not as independent as the federal exchange would be – since customer service on government marketplaces is not staffed with agents – but we do have extensive knowledge of the industry, and we can help you find the right plan.

Insurers sell plans on and off the marketplace. That’s why it’s important to shop your options. Carriers might have completely different plans on and off the exchange sites, and some could be cheaper or provide better coverage if you shop outside of the exchange. Some carriers choose not to participate on the exchanges at all.

Open Enrollment

You can’t just sign up for major medical insurance anytime. Each year, the open enrollment period gives Americans the chance to enroll in health insurance that complies with the ACA. For coverage starting January 1, 2019, the open enrollment period runs from November 1 through December 15. Outside of this timeframe, you’ll only be able to sign up for major medical plans if you qualify for a special enrollment period, which is based on major life events like marriage, the birth of a child or loss of your job.

Common Insurance Terms

As you start shopping, keep some common insurance terms in mind so you know what you’re seeing. We know these terms can be tough to keep straight. Here’s a refresher:

  • Premium: The amount of money you’ll have to pay each month for your health plan, regardless of whether you saw a doctor that month or not.
  • Deductible: A set amount that you have to pay before an insurance company starts paying its share of your medical costs. Some services, like wellness screenings and other preventive care, don’t count toward the deductible (meaning you won’t need to meet the deductible first before the company covers it).
  • Network: Healthcare providers whose services are covered by insurance. “In-network” means a provider in the network while “out of network” usually means that your insurance won’t cover services from this person/provider (or will cover it at a reduced rate).
  • Provider: Any healthcare person or institution that provides your care; this would include primary care doctors, surgeons, psychologists, physical therapists, clinics and anyone or anywhere else that provides care.
  • Copay(ment): Copays are a flat fee charged for services covered by your health plan. You may have a $20 copay for primary care visits, for instance, or a $200 copay for emergency room visits that don’t lead to hospitalization.
  • Coinsurance: Similar to a copay, coinsurance is a percentage that you and the insurer split for your care. Once you meet the deductible, you might have 30 percent coinsurance, which means that the insurer will cover 70 percent of the bill (after the deductible) and you’ll be responsible for the rest.

This list isn’t exhaustive, of course, but these are common terms that come up when you’re buying health insurance.

Buying Health Insurance

Now that we’ve set you up for buying health insurance, you might still be wondering how you actually go about getting a policy. Well, that’s up to you. You’ve got several options for buying major medical plans. We recommend working with health insurance professionals who can answer any questions that you have along the way. Shopping on a private marketplace (like ours) gives you the chance to see different carriers and plans, ask questions of agents over the phone or online, and buy a plan with confidence. Before you check out your options for coverage, though, make sure you’ve got some basic info available, including:

  • Your name and the names of anyone buying a plan
  • Health information, such as medical problems or prescriptions you take, so you can see the coverage that a plan offers for these services
  • Your income and monthly budget, so you don’t get swayed into a plan you can’t afford

Having your information handy will help you find the right plan – not to mention apply when you’re ready. Don’t wait too long to buy health insurance. Remember that you can only buy major medical coverage during open enrollment, which ends on December 15 in most states.

How Soon Does Major Medical Insurance Start?

Open enrollment gives people a chance to shop for health insurance once a year. In 2018, the open enrollment period for coverage starting next year begins on November 1 and runs through December 15. You have other chances to enroll, though. If you have a baby, get married, lose your job or move, you might be able to enroll in a major medical plan thanks to a special enrollment period. No matter when you sign up, though, coverage doesn’t start right away in the major medical world. (Short term health insurance is a different story.) Not sure when your coverage will start based on when you sign up? Here’s what you need to know.

Signing Up During Open Enrollment

As we mentioned above, the federal open enrollment period for ACA 2019 health insurance runs from November 1 through December 15, a period of about six weeks. Whether you sign up at the very beginning of open enrollment, at the very end or right in the middle, your coverage will go into effect at the same time. All plans bought during this timeframe take effect on January 1, 2019.

If you have a 2018 health plan, that coverage will continue until December 31, 2018, as long as you keep up with your premium payments. Your new plan will take effect as soon as the previous one ends. In fact, if you choose to keep your current policy or you’re automatically re-enrolled, you may not even notice any transition period as you move from one calendar year to the next.

Some states that have their own health insurance exchange sites apart from HealthCare.gov can (and do) set their own deadlines for open enrollment. Residents of those states may be able to wait until the end of December or January to choose their plan for health insurance in 2019. An extended signup period gives people more time to decide on the health insurance that’s right for them, but it does impact when coverage starts. If you want your coverage to begin on January 1, 2019, you’ll still probably have to buy your plan by December 15, 2018. Waiting later than that will likely push your effective date back to February or even March.

Special Enrollment Period Signups

Experiencing a major life event can give you an additional opportunity to sign up for an Obamacare health plan or switch to a different major medical plan. Only certain life events qualify you for a special enrollment period, however, and your new healthcare coverage won’t begin right away. You typically have 60 days after a qualifying event to apply for a change in health insurance. The sooner you apply, the sooner coverage takes effect.

When does coverage take effect if you buy it during a special enrollment period? It depends. The general rule for special enrollment periods is that your coverage will start either the month after you submit your application or the month after that.

  • If you apply for major medical coverage by the 15th day of the month, your new plan will go into effect on the first day of the following month.
  • If you wait until the 16th or later to apply, your new healthcare coverage won’t begin until the first day of the month after next.

For example, if you submit your request for coverage on April 13, your plan will have an effective date of May 1. However, if you pick a plan on April 17 – just four days later – your health insurance won’t begin until June 1.

This rule applies to many of the circumstances that can qualify for you a special enrollment period. These include getting divorced, experiencing a shift in income that changes your eligibility for premium tax credits, and being released from prison. Keep in mind that for some of these qualifications, you’re eligible for special enrollment only if you already have a health insurance plan that qualifies as minimum essential coverage.

Exceptions to Special Enrollment Effective Dates

Not all special enrollment periods hold to the general rule about effective dates. There are exceptions to the rule, including adding children to your plan and knowing ahead of time about coverage changes.

Adding Children to the Family

Birth, adoption and foster placements allow you to apply for major medical coverage when these events happen even if you don’t already have a major medical plan in place. You have two options to choose from when applying for insurance after adding a child to your home: retroactive coverage or future coverage.

Retroactive coverage can be retroactive to the date that the child became part of your family. If your baby was born on September 2, for example, then you can opt for your coverage to have an effective date of September 2, even if you don’t fill out the application until October 23. Alternatively, the coverage can go into effect on the first day of the month after you submit your application. If you want to keep your current insurance plan for one more month before switching, this could be a better option for you.

Anticipated Changes

Sometimes, you have advanced notice that you’re going to be experiencing a major life event. Moving to a new state or losing job-based healthcare might be something you can anticipate. In these cases, you might also be able to plan ahead for your new insurance coverage. Your special enrollment period will begin 60 days before your change is to take place, and it will close 60 days after the change.

If you sign up for a new plan in the 60 days preceding the event, you might be able to start your new coverage sooner. Your new plan’s effective date will be the first day of the month after which the change takes place.

Waiting until after the change occurs could lead to delays in coverage. Your new plan won’t start until the first day of the month after you buy it.

As an example, let’s say that you move to a new state on August 10. Picking out a new plan before you move means that your coverage will begin on September 1. Selecting your new coverage on August 11, right after your move, would also qualify you for a start date of September 1. However, because you have a 60-day window after the event to sign up for a plan, you could also wait until early October to make your health insurance change. If you don’t sign up until October 3, your plan won’t go into effect until November 1.

When buying a health insurance plan, consider the start date for coverage. Open enrollment runs for about six weeks. If you don’t have coverage when you sign up for a new plan during enrollment, then you’ll have to wait until the new year to use your health plan. In the interim, you might consider short term health insurance to fill the gap while you’re waiting for your health plan to take effect. Signing up during a special enrollment period can be an issue of timing as well, so consider your options carefully as you look for the perfect plan.

Financial Help for Buying Health Insurance

The goal of the Affordable Care Act was to make health insurance more accessible to all Americans. Increasing the affordability of insurance was a large component of that goal. In an effort to bring down the costs of coverage for middle-class Americans, the ACA established financial assistance options to reduce how much you pay in premiums and other costs, like copays and deductibles. If you make between 100 and 400 percent of the federal poverty level (FPL), these cost-reducing programs may help you save money on your coverage.

Advance Premium Tax Credits

About 80 percent of people who buy Obamacare plans on the HealthCare.gov exchange qualify for advance premium tax credits, also known as subsidies. But these subsidies are not an automatic benefit for anyone who buys a private health plan. To receive subsidies, you must not have access to an employer-sponsored health plan, or your job-based insurance must be deemed unaffordable per the limits set by the ACA.

You also have to meet certain income guidelines. Your modified adjusted gross income (MAGI) must fall between 100 and 400 percent of the FPL, which is calculated by taking into account both your household income and your family size. In other words, the FPL is higher for a family of four than it is for a family of two or an individual.

Contrary to what you might think, you don’t have to shop on a health insurance exchange site to get a tax credit. You can benefit from Obamacare subsidies whether you purchase your insurance directly through the healthcare marketplace or you rely on the assistance of a broker to help you obtain health insurance in 2019. When you apply for your ACA 2019 plan, you will provide information about your income and family size. This information will be used to determine your eligibility for premium tax credits. The subsidy amount for which you qualify will also depend on the cost of the second-least expensive silver health plan in your area. (This is known as the “benchmark plan” and it determines cost assistance for everyone.)

Advance premium tax credits will cover part or all of your monthly premium costs. The federal government will submit your subsidy directly to your insurer. Each month, you’ll be responsible for paying the remaining portion of your premium.

You aren’t required to use your full tax credit each month. In fact, you can opt to pay your full premium each month instead of claiming any advance premium tax credit. Any funds that weren’t applied to your major medical premiums will be returned to you in your tax refund the following year.

We want to emphasize the importance of knowing your income or, in the case of self-employed or freelance workers, knowing how to estimate it correctly. If you get a subsidy but end up earning more than you thought for the year – thus reducing the amount of cost assistance that you qualify for – you will owe the difference back when you file your taxes for the year.

Cost-Sharing Reductions

Some people qualify for both ACA subsidies and an additional type of assistance known as cost-sharing reductions. This additional Obamacare benefit is available to individuals and families whose household income falls between 100 and 250 percent of the FPL. You can receive this benefit only if you purchase healthcare coverage at the silver level. As with ACA subsidies, you won’t qualify if you have access to affordable job-based insurance.

Cost-sharing reductions aren’t contributions to your premium payments. Instead, they’re payments made on the part of insurance companies to reduce your personal responsibility for healthcare expenses. This is accomplished by increasing the actuarial value of the plan. The actuarial value for which you qualify depends on your household income.

  • Incomes above 250 percent of the FPL do not qualify for cost-sharing reductions. Silver plans at this level have an actuarial value of 70 percent.
  • Households with incomes between 201 and 250 percent of the FPL qualify for plans with actuarial values of 73 percent.
  • Individuals and families with incomes between 151 and 200 percent of the FPL can purchase silver plans with actuarial values of 87 percent.
  • Those with incomes between 100 and 150 percent of the FPL can benefit from plans with actuarial values of 94 percent.

Not sure what any of that means? It boils down to value. If your income qualifies you for cost-sharing reductions, then you’ll qualify for a health plan with better actuarial value (meaning it covers a greater percentage of your healthcare costs) for less money than the average person would pay for the same plan. And the “discount,” so to speak, is automatic based on your income. The insurance company takes care of it because they’re required to under the ACA.

The federal government used to reimburse health insurers for the expense of these benefits, but that stopped in 2017. The year before, a challenge to cost-sharing reduction payments (how insurers got reimbursed for discounting their plans) had been successful in halting payments based on questions of legal funding, and the Trump administration decided last year to stop them altogether going forward. Insurers responded by raising the cost of their plans – particularly silver-level plans since these are the benchmark for cost assistance – to make up for this loss of reimbursement. Of course, this increased advance premium tax credits across the board since cost assistance goes up with premium prices, so the government is still footing the bill for cost-sharing reductions.

Unlike with premium subsidies, if you underestimate your income when applying for Obamacare 2019, you won’t end up having to pay back any benefits provided to you through cost-sharing reductions.

Lower Out-of-Pocket Maximum

The federal government sets guidelines for how high a major medical plan’s out-of-pocket maximum can be each year. This is the highest amount of money that you can be required to pay for covered healthcare services in a calendar year; it does not include premium costs. Federal limits on out-of-pocket maximums are lower for people who qualify for cost-sharing reductions.

In 2018, the government set a cap of $7,350 for out-of-pocket maximums for individual plans and $14,700 for family plans. This applies across all tier levels. But there are lower limits for people who get cost-sharing reductions. If you earn between 100 and 200 percent of the federal poverty limit, your cap will be $2,450 for an individual plan (doubled for families). Those earning between 201 and 250 percent of the FPL get capped at $5,850 for individual plans and twice that for families. To reiterate, cost-sharing reductions are only available at the silver level.

Other than setting limits on out-of-pocket maximums, the federal government does not specify what an insurer must do to increase the actuarial value of a plan purchased on the marketplace in 2019. Carriers might charge lower copays and coinsurance rates while charging a higher deductible to make the math work out on actuarial value.

Lower-Income Options

Advance premium tax credits and cost-sharing reductions are available to you only if your household income is at least 100 percent of the FPL. If your income is lower than that, you won’t qualify for the help. In some states, you might qualify for Medicaid instead. Since the ACA became law, most states have expanded their Medicaid programs to include higher income parameters and a broader applicant base.

However, some states have chosen not to expand Medicaid. If you live in one of the states that opted out of expansion, you may not qualify for this government-assistance program, even if you have a low income. People who don’t make enough to qualify for ACA assistance but who make too much to be approved for Medicaid are said to be stuck in the Medicaid gap.

Buying full-price major medical insurance might be an unrealistic prospect if you’re stuck in the Medicaid gap. Instead, you might need to rely on receiving healthcare services from free or sliding-scale clinics. And if you need coverage for emergencies in the interim, short term health insurance offers an affordable safety net.

The ACA sought to make health insurance more affordable, and for many people, it accomplished that goal. If you’re still unsure about your options or where to get started, let us help. Asking questions and exploring the plans that are available to you – on and off the exchange – is the only way to know for sure how to afford health insurance in 2019.

More Than Cost: What to Consider When Buying Health Insurance

If you’re looking for the best type of health insurance in 2019, consider more than the cost at face value. Competing plans may seem alike, but the fine print will show how much an insurer covers for things like hospitalization, prescription drugs and lab work. When it comes to the real cost of health insurance, you may be faced will bills topping five figures or more even with coverage. Look beyond the premium price to see what a plan truly covers – and what your responsibility as a subscriber will be.

The Affordable Care Act (ACA or Obamacare) has been a boon for many people who might otherwise not be able to afford health insurance. It requires some research, though, to figure out the plan that works best for you. Costs will vary widely among plans, even plans offered by the same insurer in the same area. Obamacare requires all major medical policies to cover a set of the same types of services, but not all health plans treat this coverage the same. The premium is only one part of the cost. Copays, deductibles, coinsurance and out-of-pocket caps should also be considered when buying health insurance.

10 Essential ACA Benefits

Major medical plans today must cover 10 essential health benefits as mandated by law. These are types of services. The law doesn’t specify the degree to which a plan must cover the benefits, either, so one plan might require you to pay more for services like physical therapy while another limits prescription drug coverage. Nevertheless, every ACA-compliant plan bought on or off the exchanges will cover the following types of care:

  • Outpatient services
  • Emergency room care
  • Hospitalization
  • Maternity benefits
  • Mental health services
  • Prescription drugs
  • Rehabilitative care and equipment
  • Laboratory costs
  • Preventive care, including screenings and immunizations
  • Pediatric care, as well as pediatric dental and vision care

As you might imagine (and might have noticed), covering all of these services means that health insurance plans today cost more than they used to. Comprehensive benefits help you take care of yourself, but they also make insurance more expensive.

Network Plans

Some health plans rely on networks to keep costs low for subscribers. Health maintenance organizations (HMOs) usually only cover providers that participate in the plan’s network unless it’s an emergency. Preferred provider organizations (PPOs) typically cover both in- and out-of-network care, but non-network care is covered at a lower rate, meaning you’ll have higher costs if you see providers outside the plan’s network.  

Choosing healthcare coverage offered within a network can help with the cost of insurance. Insurers rely on a large market of healthcare consumers participating in the plan. This allows them to negotiate lower physician, hospital and prescription drug prices based on volume. That’s why network providers will rely on capturing a large share of the healthcare marketplace in 2019 to reduce costs. It’s also one of the reasons that an insurer can provide primary care and major medical coverage at reasonable rates.

What About Seeing a Specialist?

Some insurers hold down costs by requiring a referral from a primary care physician before a patient can get an appointment with a specialist. In general, any plan that allows the patient to visit specialists without a referral will require a higher premium. In some cases, it may be worth the savings in premium and copay costs to opt for a managed plan that requires referrals.

This is one of those important details of a health insurance plan that should be considered on an individual basis. Most people rely on their family physician the majority of the time. But for those with chronic conditions, the ability to see a specialist without a referral may be a vital feature of a health insurance plan. If the cost of the insurance is within the family budget, unfettered access to specialists can be an important benefit that’s worth the extra cost per month.

ACA Cost Assistance

Obamacare has built-in discounts for people who qualify based on income, one of those being advance premium tax credits, also called subsidies. If you earn between 100 and 400 percent of the federal poverty level (FPL), you can get a subsidy to reduce your monthly premium. About 80 percent of people who buy plans on an Obamacare marketplace qualify for advance premium tax credits.

For those who qualify for additional assistance, the ACA cost-sharing reduction (CSR) lowers the cost of health insurance deductibles, copays and coinsurance. Over half of those enrolled in a HealthCare.gov plan receive CSRs, which require enrollment in a silver-level plan. You must earn between 100 and 250 percent of the FPL to qualify. These reductions are available alongside the subsidies, so you can get both if you’re eligible.

Funding Problems

Obamacare has been a game of political football since it became law, escalating more quickly since President Trump took office. You might worry that the ACA’s built-in discounts will be discontinued. Given the conflicting news stories surrounding cost-sharing reduction payments and everything else related to healthcare policy, it’s not surprising that lots of people have lots of questions about where health insurance stands at the moment. In short, it stands where it has since 2010: The ACA is still law.

There have been some important changes, though. While insurers are still required by law to offer cost-sharing reductions to people who qualify for them, the federal government stopped reimbursing insurers for these payments in October 2017. Since insurers now carry the full brunt of reducing costs to consumers, they’ve raised premiums as a result. Silver-level plans got hit hardest since these plans form the benchmark for federal subsidies.  

Higher premium prices really only affect people who don’t qualify for cost assistance since that assistance increases with the price tag of marketplace health plans. For people who don’t get subsidies, though, these price hikes can be devastating.

We should note that families with an income too high to qualify for subsidies may have access to off-exchange silver plans at a lower price. Some insurers have opted to provide the same benefits and protections under ACA-compliant off-exchange plans, but without the increased premiums that reflect the cost-sharing burden.

ACA-Compliant Plans

When looking for health insurance outside of the ACA exchange, know that you can buy major medical coverage that meets the demands of the law and gives you comprehensive benefits. Off-exchange health insurance includes major medical coverage, and it provides the same benefits and protections as on-exchange plans. The difference is that off-exchange health insurance is purchased directly from an insurance company, via a broker or insurer, or through an independent marketplace like this one rather than through a state or federal exchange.

Unless an insurance plan is ACA-compliant, there’s no guarantee that it covers every healthcare need. All major medical plans are now required to conform to ACA guidelines, but some plans – like short term health insurance – don’t count as major medical insurance and don’t fall under that umbrella. In this case, it’s especially important to look at all of the costs of an insurance plan and to read the details about exactly what’s covered.

When scouting for health insurance in 2019, make sure that any plans you consider cover the services that matter to you. A good place to start is the list of 10 essential benefits provided by the Affordable Care Act and to determine whether a health plan you’re considering complies with the law. Beyond the face value of the health plan, look at how it handles your regular out-of-pocket expenses so you don’t get stuck with coverage that doesn’t really cover your needs.

How Much Does Health Insurance Cost?

Health insurance in 2019 isn’t cheap, and even with coverage, you may be responsible for a large portion of your healthcare costs. These expenditures can involve premiums, deductibles, copays and more. Your level of financial responsibility can vary widely from one Affordable Care Act plan to the next. Navigating the various costs of health insurance can be a challenge, but it’s important to understand how these factors affect your overall healthcare spending. Before you sign up for a health plan, take time to become familiar with the basic costs of major medical insurance.

Premiums Get Paid No Matter What

One of the most basic costs involved with major medical coverage is the monthly premium. This is the set amount that you must submit to the insurance company every month in order to maintain your coverage.

Even if you didn’t submit any claims to your insurance company in the previous month or don’t intend to use your health insurance in the upcoming month, you still must pay your premium. If you don’t pay this monthly fee, you’ll lose your coverage. And since failure to pay premiums is a legitimate reason that a company can cancel your coverage, losing your health plan for this reason won’t open up a special enrollment period for you to buy another plan.

You’re Responsible for the Deductible

What is a deductible? It’s a set spending level that you have to contribute toward your healthcare costs before your insurance plan starts paying its share. If you’re hospitalized when you have coverage from an individual health plan with a $6,000 deductible, you’ll have to pay the full amount of the first $6,000 in medical bills.

Some plans pay for claims before you meet the deductible by having you pay a copay at the time of service. You might have a $20 copay to see your doctor, for instance, if it’s just a visit for a sore throat or a sprained ankle. In this case, you wouldn’t have to meet the deductible first. Preventive care is also covered without any cost sharing thanks to the Affordable Care Act. Wellness visits, well checkups for your kids, preventive screenings (like mammograms) and standard vaccines (like flu shots) are all examples of preventive care that won’t come with a copay or coinsurance and won’t count against your deductible.

If you have a family plan, it’s also important to understand the difference between embedded and aggregate deductibles.

  • With an embedded deductible, each person has a separate individual deductible. When one person meets that level of spending, the insurance plan will start paying for a portion of that person’s healthcare costs even if the family deductible hasn’t been met.
  • With an aggregate deductible, also known as a non-embedded deductible, the full family deductible must be met before the insurance company picks up a portion of any family member’s claims.

Some plans have separate deductibles for various services. For example, in addition to a $3,000 major medical deductible, there may also be a $500 deductible for prescription drugs. Read a plan’s overview carefully to see how it handles deductibles. A low premium might attract you to the plan, but lower premiums mean higher deductibles – sometimes five-figure deductibles.

Copayments Are Set Fees

You might wonder what a copayment is and how it works. The word “copayment” or “copay” refers to a set fee that you pay for particular services. Major medical plans most commonly feature copays for doctor visits and prescription drugs. You might find a plan that requires a $50 copay for a specialist visit or a $10 copay for generic prescription drugs.

As we talked about in the last section, copays may be pre-deductible or post-deductible. Pre-deductible copays aren’t subject to the deductible. From the first effective date of your plan, you can receive these services and be responsible only for the copay portion of the charges. However, your copay won’t count as a contribution toward your deductible. By contrast, post-deductible copays don’t apply until you’ve already met your deductible. After that, you’ll pay a flat fee for certain services.

Coinsurance Is a Percentage

Is there a difference between a copay and coinsurance? Yes, there is, and it can make a big difference in your out-of-pocket costs for the year. Both refer to the portion of your care for which you’re responsible, but each addresses your responsibility differently. Copays are a flat fee for services and can be charged before and/or after meeting your deductible. Coinsurance is a percentage of your medical bills that you must pay. Coinsurance doesn’t go into effect until you’ve met your deductible. After that, you’ll pay the coinsurance amount for any remaining charges.

Think about the hospitalization example above. After you’ve met your $6,000 deductible, the insurance company will expect you to pay your coinsurance amount for any charges above $6,000. If your total hospital bill comes to $10,000 and you have 20 percent coinsurance, you’ll pay $6,000 for your deductible plus an additional $800, which is 20 percent of the remaining $4,000 in charges.

Not every health plan has both coinsurance and copayments, but it is a common structure. And to reiterate a point we made earlier, lower-premium plans usually require customers to shoulder more of the burden in healthcare costs. A bronze plan, for example, might come with a coinsurance rate of 40 percent while a higher-tiered gold plan might only require 20 percent. These costs add up over time, especially if you need a lot of medical care.

Out-of-pocket Maximums Limit Your Responsibility

You’re responsible for the coinsurance and copay amounts until you reach your out-of-pocket maximum for the year. This is the highest possible amount that you’ll have to pay for covered care in one year.

The out-of-pocket maximum doesn’t include any premium costs that you pay. It also doesn’t include the money that you spend on any healthcare services that aren’t covered by your major medical plan. The government sets limits on how high individual and family out-of-pocket maximums can be. In 2018, the cap on out-of-pocket expenses for individual plans is $7,350 (for family plans, that cap is doubled). Your health plan may have a lower out-of-pocket maximum, but no plan can set caps above this government-approved amount, which changes each year.

Cost Assistance May Reduce Your Healthcare Spending

You may be eligible for cost assistance from the federal government that can reduce the amount that you must pay for your health insurance. There are two different types of cost assistance that relate to major medical plans: advance premium tax credits and cost-sharing reductions. To qualify for cost assistance, you have to buy an Obamacare marketplace plan – but you don’t have to buy it from the actual marketplace. You can also use a broker, who can complete the process for you.

Advance premium tax credits, also called subsidies, can reduce what you pay in premiums. How much you qualify for in subsidies depends on your household income. People who earn between 100 and 400 percent of the federal poverty level qualify for tax credits. The government sends your premium tax credit directly to the insurance company, and you pay the remainder of your premium each month. You can use these subsidies to buy a cheaper plan for practically nothing, or you can apply the amount to a more expensive plan with better coverage to make it as economical as a bronze one. Around 80 percent of people who buy marketplace plans qualify for tax credits to reduce monthly premiums.

Cost-sharing reductions are available to people who have incomes between 100 and 250 percent of the federal poverty level. These reductions lower your other healthcare expenses, such as deductibles, copays and coinsurance. To take advantage of these reductions, you must purchase a silver-level plan.

In-Network and Out-of-Network Care Are Handled Differently

Most health insurance plans are designed to work closely with a specific set of providers (referred to as “in-network” care). Providers outside of the designated network will charge more, and your insurer doesn’t have to cover the care unless they’ve made provisions for it in your policy. Out-of-network care is more expensive and requires greater cost sharing on your part, so pay close attention to the network of any health plan you’re considering. Some major medical policies, particularly HMOs, don’t cover out-of-network care at all, which would leave you with the full cost of the bill for non-emergency services.

Balance Billing May Increase Your Costs

There’s one important billing practice that you need to be aware of when you’re buying coverage and picking a health plan, but it won’t be explicit when you’re shopping. It’s a practice known as “balance billing.” Balance billing happens when a provider charges you (the patient) for anything that the insurance company didn’t cover. It goes above and beyond your standard coinsurance rate or copayment, and it affects people who go outside of the plan’s network for care.

Let’s say you see an out-of-network podiatrist for some heel pain. You’ve gone out of network because your friend raved about her podiatrist, and you wanted to see this specialist even though he wasn’t in your plan’s network. The specialist charges $200 for office visits. Your plan will cover out-of-network care but at a higher cost. When the podiatrist’s office files the claim, your insurer decides that it will pay $80 for your appointment. The podiatrist isn’t willing to write off the remaining balance. As a result, you get a bill for $120. If you had stayed inside your network, you would have only paid $40 for a specialist visit (a common example of a specialist copay).

This is a simplified example since much of medical billing depends on a complex system that isn’t standardized from one provider to the next (or one insurer to the next), but you get the idea. This is also a small example. Recent news stories have highlighted patients receiving six-figure bills from providers due to balance billing. It’s become such a problem that lawmakers in Congress are now discussing federal intervention, since states have varying laws on the practice.

The takeaway is that you should – whenever possible – visit in-network providers. If that’s not possible or in your best interest, make sure you understand your plan’s policy on networks and coverage so you won’t get stuck with excess charges. Learning the costs ahead of time, researching your local networks and asking questions can go a long way in ensuring that you only pay your fair share of a medical service.

Can I Lose My Health Insurance?

Employer-sponsored major medical coverage goes away when you stop working for your employer, but individual health plans aren’t tied to your job status. This gives you the freedom to switch career tracks without affecting your healthcare coverage. But even with an individual health plan, continuous coverage isn’t always a sure thing. There are a variety of circumstances – some that you can control and some that you can’t – that could cause you to lose your non-group health insurance in 2019.

You Will Lose Coverage If You Don’t Pay Your Premiums

To maintain healthcare coverage, you must pay the monthly premiums. If you don’t pay, you’ll lose your health plan eventually.

Even if you qualify for Affordable Care Act subsidies, you may be responsible for remitting a premium payment each month. The tax credits for which you qualify will probably cover only a portion of your major medical premiums. It’s your responsibility to submit the remaining balance to your insurance company before the due date each month.

However, you won’t automatically lose your coverage just because your payment is a few days late. The federal government requires that insurers provide a grace period to Obamacare subscribers. After missing a payment, you’ll have a 90-day period to make up past-due payments and submit any additional premiums due in the meantime.

For example, if you miss your August 1 due date, you must turn in your payments for August, September and October by the end of October to maintain your ACA 2019 coverage. If you don’t catch up on your payments by the deadline, your plan will be terminated. The cancellation will be retroactive to the date of your first missed payment – in this case, August 1. That means any claims submitted during that time won’t go through, and you could also be stuck with unexpected medical bills since you weren’t covered during that period.

Grace periods are allowed only if you begin the year by making at least one month’s payment. If you miss the first due date of the year, you might not receive any grace period. Also, the federal rule about grace periods is specific to those who are eligible for advance premium tax credits. For those who don’t receive subsidies, different rules may apply, and these may vary among states.

Losing your major medical insurance because you failed to turn in your premium payments means that you won’t be eligible to sign up for a new major medical plan until the next open enrollment period. Nonpayment doesn’t qualify you for a special enrollment period, so you’ll probably have to go without major medical insurance for a time.

Even open enrollment doesn’t wipe the slate entirely clean. If you select a plan from the same insurer that you had before, you may be required to make up payments from the previous year before the company will agree to issue you a new plan.

When you enroll in your Obamacare 2019 plan, think carefully about whether you’ll be able to pay the premiums from month to month. It’s better to have a high deductible plan with lower, affordable premiums than it is to be left with no coverage at all because you couldn’t make the premium payments on a higher-tiered plan.

You Might Lose Coverage If You Fail to Act

There are times when a healthcare marketplace application requires more information than what you originally provided. After submitting your application, you’ll receive a notice if there is additional information that you must turn in. The request will be accompanied by a deadline for submitting the information.

Most special enrollment periods require that you turn in proof of your eligibility. You’ll be given 30 days to provide the necessary documents.

Failing to turn in the required documentation is grounds for losing your health insurance. If your plan is terminated for this reason, you won’t be eligible for a different one until the next open enrollment period.

You Could Lose Coverage If Life Circumstances Change

Life changes fast, doesn’t it? When it does, you could lose your major medical plan. During stressful times, health insurance might be the furthest thing from your mind, but it’s important to pay attention to whether your coverage will still be valid. Unlike failing to pay or to send in documentation, life circumstances are sometimes beyond your control. If you lose your major medical health insurance for one of these reasons, you may be eligible to purchase a new plan from the healthcare marketplace right away.

Divorce

Going through a divorce can alter many aspects of your life, including your health insurance coverage. If your major medical plan is in your spouse’s name, he or she will have to remove you from the plan once your divorce is finalized. Filing for a legal separation can also cause you to lose your health insurance. It’s the subscriber’s responsibility to update the marketplace application with a change in marital status.

Moving

Insurance options vary throughout the country, and most insurers have a specific service area in which they operate. If you move out of that service area, you could lose your healthcare coverage. A move across state lines will certainly terminate your current plan. An in-state move is less likely to require that you find new health insurance, but there’s still a chance that you won’t be able to keep your coverage after the move.

Even if you don’t think that moving will cause you to lose your medical coverage, you should notify your insurer of your change of address. If you have an Obamacare plan, you’re required to submit this information to the marketplace. For an in-state move, you do this by updating your current ACA 2019 application. For an out-of-state move, you must start a new application.

Aging Out

ACA regulations allow young adults to stay on their parents’ major medical coverage until they turn 26. Even if you have your own house, you’re married, you’re financially independent or you could get insurance through your workplace, your parents can allow you to stay on their plan until you age out at 26

Exactly when you lose health insurance after turning 26 depends on the type of plan that you have. This is one area in which those on nongroup health plans have an advantage over those with employer-sponsored health insurance. Job-based insurance plans typically terminate coverage the day that a dependent turns 26. Plans through the healthcare marketplace allow dependents to keep their coverage until the end of the calendar year in which the 26th birthday occurs.

You’ll Lose Coverage If Your Insurer Stops Offering the Plan

There’s always a chance that your insurance company will experience a major change. The company might suddenly quit offering your plan. It could even go out of business. If that happens, you’ll no longer have major medical coverage. Fortunately, since this is a circumstance outside of your control, you won’t be held responsible for this loss of coverage. You’ll qualify for a special enrollment period so that you can sign up for a new health insurance plan right away.

The Affordable Care Act guarantees your right to coverage no matter your health history, and insurers can’t drop your health plan for arbitrary reasons or because you develop an expensive medical condition. But these guarantees don’t extend to situations like major life changes, nonpayment or an insurer going out of business. If you find yourself without a health plan for legitimate reasons – like something outlined above – consider your other options for health insurance, whether it’s a major medical plan outside of the marketplace or a short term policy to bridge a gap in coverage.

Can I Get Subsidies Outside of the ACA Exchanges?

With all the changes to Obamacare and the marketplace in 2019, you may be confused about the many different options available that help you save money on your health insurance. One word that is commonly used when discussing the Affordable Care Act healthcare marketplace is “subsidies,” which are designed to lower the cost of health insurance premiums for people who qualify based on income. In order to understand whether you can get cost assistance outside of the exchange, you need to know how subsidies work.

What are ACA Subsidies?

Subsides are officially known as advance premium tax credits. Available to people earning between 100 and 400 percent of the federal poverty limit (FPL), these tax credits allow you to purchase health insurance on (and off) Obamacare exchanges for less than the face value of the plan. In other words, they lower the premium price.

You can choose to have the credits paid in advance to the insurance company toward the cost of your premiums, or you can wait to get the credits back when you file your taxes at the end of the year. Just make sure you report your income as accurately as possible. If you earn more than you reported when you applied for a plan, then you may owe the difference in tax credits back to the government when you file taxes. The reverse is true as well. If you earn less than you reported, you may get the difference back in a refund since you would have qualified for a greater subsidy.

Along with subsidies, you might qualify for cost-sharing reductions. These are available for people who earn between 100 and 250 percent of the FPL, and they reduce out-of-pocket costs like copays and deductibles. Cost-sharing reductions essentially increase the actuarial value of your health plan without charging you more – so you get better coverage for less money. You must buy a silver-level health plan to get a cost-sharing reduction.

Subsidies Outside the Exchange

One of the biggest selling points of the federal and individual state health insurance exchange sites is that they alone let you use subsidies to buy health insurance. Well, that’s not entirely true.

It is true that to get a subsidy, you must buy a marketplace plan. But you don’t have to buy that plan from HealthCare.gov. Customers have been able to get subsidized insurance via the Obamacare exchanges by going through an independent web broker for years, but it was a complicated process known as a “double redirect.” Changes made by the Health and Human Services Department last year addressed the flaws in this system, making it easier for agents and brokers to allow customers to buy subsidized plans straight from their websites instead. It’s a win-win for you as a health insurance shopper.  

This only applies generally to customers without access to a state health insurance exchange. State-based exchanges may limit how people get subsidies since some set tighter restrictions on access to premium tax credits. But if you live in one of the 39 states that use the federal marketplace at HealthCare.gov, then you can buy a subsidized plan off marketplace by using a broker or independent market site.

Haven’t Subsidies Been Eliminated?

You might have heard about cost-sharing reductions in the news, or you might not understand which cost assistance options still exist on the ACA marketplace in 2019. The short answer is that both advance premium tax credits and cost-sharing reductions still exist for consumers who qualify. The longer answer involves some legislative hullabaloo that resulted in the Trump administration cutting off cost-sharing reduction payments to insurers. These payments helped carriers offset the losses they faced when offering cost-sharing reductions in the first place. Absent the federal reimbursement for these payments, insurers had to raise rates even further than they might have anyway. The ACA requires insurers to offer cost-sharing reductions, so it’s not something that carriers can stop doing for marketplace plans.

The thing to remember is that if you qualify for some form of cost assistance to help reduce your premiums or limit out-of-pocket expenses, you can get it on or off the exchange as long as you’re working with a legitimate seller – be that an individual agent, a broker site or an independent marketplace like this one. Don’t let doubts about cost assistance keep you from shopping. You’ve got options for affordable coverage.

10 Essential Health Benefits under Obamacare

The Affordable Care Act of 2010 was created in response to notable gaps in the healthcare marketplace that left millions of people without coverage or made health insurance too expensive for average Americans to afford. Before the law took effect, health insurance policies often involved a patchwork of benefits that could vary widely, sometimes leaving Americans exposed to high medical bills that resulted in bankruptcy. While some changes should impact the ACA in 2019, the law still retains the 10 essential health benefits that were believed to be necessary for effective healthcare. Not sure what benefits are considered “essential” to major medical insurance? Let’s take a look.

1 – Ambulatory Care
You can receive outpatient care for health issues without having to be admitted to a hospital, and those services are covered under Obamacare. Ambulatory care refers to any time you need to see your primary care physician for something like a bad chest cold, skin rash or minor injury, or a medical provider outside of a hospital setting, such as a dermatologist performing a mole removal in her office. Generally, you’re responsible for a copayment or must fulfill a deductible amount before coverage begins. Cost-sharing – how much you pay for a medical service or treatment – depends on your plan’s cost structure.

2 – Emergency Services
When you have a healthcare emergency, the Affordable Care Act guarantees coverage for medical services. Your health plan may include a network of providers, including hospitals, so choose your hospital carefully if you can. But in a true emergency, your carrier may waive out-of-network charges. Some states even have laws about this, though it’s not a guarantee. In any case, you’ll be required to cover any copays, coinsurance rate or deductibles as outlined in your plan even in an emergency.

3 – Inpatient Hospitalization
The ACA covers inpatient hospitalization when you experience a profound illness or injury that requires treatment, such as surgery or other necessary procedures. Before Obamacare, major medical plans could cap benefits for the year or for a person’s lifetime. That’s not the case anymore. Insurers aren’t allowed to cap benefits, so you won’t need to worry about hitting a benefit cap if you end up with a costly illness like cancer.

4 – Pregnancy, Maternity and Newborn Care
In the past, pregnancy and maternity care might have been excluded from coverage under private health insurance policies, which created a significant financial burden on families. Labor and delivery are expensive. Under the ACA, prenatal care and care for new mothers is covered, along with coverage for newborn children. This includes care for regular checkups throughout pregnancy as well as hospitalization for labor, delivery and postnatal care. Newborns are also covered during the postnatal period.

5 – Mental Health Care & Substance Abuse Care
Coverage for mental health care hasn’t always been a given with major medical plans. Under current law, insurance companies cannot exclude you because of a pre-existing mental health condition, nor can they charge you more for your premiums. Plans vary in what they cover, but you’ll have access to mental health care – inpatient and outpatient – thanks to requirements under the law. Substance abuse treatment is also covered under the ACA, which is especially useful in light of the nation’s alarming opioid epidemic.

6 – Rehabilitative Services & Devices
Because recovering from a medical condition may require rehabilitative programs and special equipment, the ACA also includes these as part of the essential health benefits. These services include physical therapy, speech and language therapy, occupational therapy and psychiatric rehabilitative care to help people return to normal function after an accident or disease. ACA healthcare coverage also offers coverage for rehabilitative devices, such as wheelchairs, neck braces and prosthetic limbs.

7 – Prescription Drug Coverage
Under Obamacare, health insurance policies must offer prescription drug coverage. The amount of coverage can vary from one plan to another, varying on the types of drugs and the degree to which certain types are covered, both name brand and generic. If you need regular medications, check health plans carefully for prescription benefits to make sure they cover what you need.

8 – Laboratory Services
The ACA also covers laboratory services and diagnostic testing, such as tests for diabetes, HIV, anemia and high cholesterol. Other tests may include medically necessary X-rays, MRI tests, biopsies and tissue analyses. Your plan will require different cost-sharing amounts depending on the service and how it’s billed. Preventive screenings, such as cholesterol tests, may not cost anything out of pocket while a CT scan could require you to cover 30 percent of the bill.

9 – Pediatric Care
Major medical policies cover pediatric care as well, which includes dental and vision coverage for children under age 18. Wellness checks, trips to the doctor for the flu, scheduled immunizations and urgent care visits are just some of the many benefits that fall under the pediatric care category.

10 – Preventive Care
The Affordable Care Act considered preventive services an essential coverage that helps people avoid illness and/or manage disease. The goal in covering these services without any cost-sharing is to help reduce healthcare costs. People who manage their health tend to avoid higher costs down the road. Preventive care includes annual checkups, immunizations, flu shots and screenings for a variety of diseases, such as cancer. Regular care to manage health problems like diabetes, heart disease or kidney disease are also covered.

Major medical coverage isn’t the only kind of health insurance available, but it is the most comprehensive. If you have a chronic condition, you need regular medications, you have a family with young children or you just like the option of full benefits, consider a major medical plan first for your healthcare needs. Open enrollment runs from November 1 through December 15, so explore your options today.

 

Are You Required to Have Health Insurance? In Some States, You Are

Are You Required to Have Health Insurance? In Some States, You Are

The Tax Cuts and Jobs Act of 2017 eliminated the so-called “individual responsibility payment” that the Affordable Care Act (ACA or Obamacare) imposed as part of its health insurance reforms. The shared responsibility payment was part of a larger concept known as the individual mandate. This mandate requires most Americans to hold minimum essential coverage (major medical insurance) or pay a fine when you file your taxes. For the most part, the individual mandate has been ineffective at driving young and healthy people into the health insurance market. Noble as its aims might be, the requirement to have health insurance (not to mention the corresponding tax penalty) has been unpopular among consumers – for obvious reasons – regardless of whether they support Obamacare or not.

Starting January 1, 2019, the penalty for not having health insurance gets zeroed out. In effect, this cancels out the individual mandate at the federal level. Some health insurance experts have predicted that eliminating the individual mandate will create chaos in the individual market, on and off Obamacare exchanges. Supporters of the measure assert that more freedom for people to choose the coverage they want will benefit the individual nongroup market as a whole.

But while the individual mandate penalty has been zeroed out at the federal level, states are still free to set their own guidelines when it comes to their health insurance markets. In response to the Trump administration’s move to slash the tax penalty for not having health insurance, some states have imposed their own individual mandates. And if you live in one of these states, you will be required to hold qualifying health insurance or face the penalties involved.

States with an Individual Mandate

Massachusetts

Massachusetts has had its own individual mandate in place since 2006. Once the ACA passed in 2010, the state rolled its mandate in with the federal one. Now that the federal mandate has been repealed, the state will impose its own once more. If you live in Massachusetts, you’ve got access to affordable health insurance and you go without health insurance that meets the state’s “minimum creditable coverage standards” for more than 63 days, then you’ll owe a penalty fine for each month that you didn’t have health insurance for the year.

How much you’ll pay depends on your income, but Massachusetts does set a cap on the penalty. Your fine can’t be more than 50 percent of the “minimum monthly insurance premium” that you qualify for on the state’s Health Connector exchange. In other words, if the cheapest premium you personally would pay on the Health Connector site is $200 a month, your penalty can’t be more than $100 a month. But that amount multiplies by the number of months you went without insurance, which means that in this example, you could pay up to $1,200 for the year. For married couples, each person is subject to the penalty.

You won’t have to worry about doing the math yourself. The state will happily calculate that penalty for you, of course. And not everyone is subject to the penalty. In 2018, for instance, people who earn up to 150 percent of the federal poverty level don’t have to pay the fine. If you’re a Bay State resident and you don’t want or can’t find affordable coverage (based on your standards, not the state’s), then know that you may be subject to a penalty fee if you forgo major medical in 2019.

New Jersey

New Jersey passed a law establishing its own individual mandate on May 30, 2018 in direct response to the Trump administration’s actions regarding the federal mandate. In fact, the New Jersey law is titled New Jersey Health Insurance Market Preservation Act, clearly an indicator of the state’s concerns about the individual market under Obamacare.

Unlike Massachusetts, New Jersey appears to be following the penalty calculations that the federal government used up until this year. According to the new law, Garden State residents will be required to hold minimum essential coverage or pay a state penalty “equal to a taxpayer’s federal penalty that would apply for the taxable year under section 5000A of the Internal Revenue Code of 1986, as in effect on December 15, 2017.” In other words, what you would’ve paid under Obamacare if you didn’t have coverage, you’ll now have to pay to the state of New Jersey if you’re a resident and don’t meet the law’s requirements for coverage.

In 2018, the federal penalty for not having health insurance is the greater of $695 per uninsured adult and $347.50 per uninsured child in your household, or 2.5 percent of your household’s taxable income. There are caps in place for either calculation. But instead of relying on the national average for bronze plans as a benchmark for penalty fees, New Jersey will use state averages. Also, the state treasurer will determine what counts as “affordable” for health insurance for the purpose of exempting low-income residents from the penalty fee. New Jersey’s mandate takes effect on January 1, 2019.

Vermont

Two days before New Jersey passed its mandate law, Vermont signed a law into place establishing its own individual mandate. But the state has pushed back implementation of this measure to 2020 so that the state legislature can review penalties further over the next year. Per the act signed into law, the state is establishing a mandate that will be:

“enforced by a means of financial penalty or other enforcement mechanism and that the enforcement mechanism or mechanisms should be enacted during the 2019 legislative session in order to provide notice of the penalty to all Vermont residents prior to the open enrollment period for coverage for the 2020 plan year.”

Basically, Vermont does have an individual health insurance mandate in place, but it won’t take effect until 2020. Details about how much the penalty will be and how it will be enforced have not been decided.

State Action on Individual Mandates

Massachusetts, New Jersey and Vermont are the only states with laws on the books – passed and signed – requiring their residents to hold health insurance, but they may not be the only states for long. Already, there’s been talk of other state action on individual mandates. Connecticut, the District of Columbia, Hawaii, Maryland and Washington have already proposed individual mandates for health insurance. Other states that might consider individual mandates include California and Minnesota.

Aside from political motivations – left-leaning states tend to support the ACA and may be partially motivated by pushback against the Trump administration – states that impose their own mandates could see a reduction in health insurance premiums. The Commonwealth Fund studied the impact of individual mandates on uninsured rates and premiums. Overall, they found that premiums could be nearly 12 percent lower nationwide if states adopted individual mandates. New Mexico, for example, could see premiums drop by 21 percent with a mandate in place. But the organization does note that federal spending wouldn’t change even if states adopted their own mandates.

What Does All This Mean for You?

You might be wondering what all of this means for you, especially if you live in a state without an individual mandate and one that isn’t likely to adopt one. Conservative states tend to agree with the Trump administration’s quest to dismantle Obamacare, so you probably won’t need to worry about a mandate if you live in, say, Kentucky, Idaho or Tennessee. But even if you live in a red state, the fact that some states will impose mandates and others won’t could affect insurance rates across the border. Federal requirements may also change over time depending on the goals of the administration.

It’s important to keep tabs on whether you need to buy health insurance or not. Of course, you should buy it if you can afford it – health insurance is a wise investment – but knowing whether your state has its own penalty could keep you from spending hundreds of dollars a year in penalty fees.

The bottom line is that while federal law has now scrapped the individual mandate, individual states may adopt one to encourage participation in the nongroup health insurance market. States need younger, healthier insurance customers to balance out the cost of care for people with chronic conditions and those who need more medical care. You’ve got plenty of options for health insurance on and off the marketplace, whether you buy major medical coverage or choose a new lengthier short term health plan. Consider your options carefully, and make sure you know how your state handles the individual mandate as you choose your health insurance in 2019.

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