The open enrollment period for 2016 health insurance coverage under the Affordable Care Act begins in November, so if you’re ready to switch health insurance providers, or are on the open marketplace for the first time, now might be a good time to get educated.
Under the Affordable Care Act, often referred to as Obamacare, all Americans are eligible for health insurance coverage. Plans are available via state-run marketplaces in several states and through a federal marketplace for people in states that don’t have a plan. According to healthcare.gov, Americans not covered through a job, Medicare, Medicaid, the Children’s Health Insurance Program, or another source can use the marketplace to find and enroll in a plan that fits their budget and health care needs.
Enrolling through a marketplace can be the right option for those who don’t have other health insurance, as the Affordable Care Act requires uninsured people to either obtain coverage or pay a penalty. In 2016, this penalty fee is either 2.5 percent of your yearly household income, or $695 per adult and $347.50 per child under 18, whichever amount is higher.
“Update your information, shop around, see what’s available, and compare–that’s what the marketplace is for,” says Sandy Ahn, a research fellow with the Center on Health Insurance Reforms at Georgetown University. “See if you can get a better value for the money you’re paying.”
If you’re in the market for insurance, you may want to consider asking your health insurance provider a few basic questions to ensure you’re getting the right plan for your health care needs:
How much will my plan cost?
The marketplace offers plans in five categories: bronze, silver, gold, platinum, and catastrophic. The plan you choose determines how you and your insurer share the costs of care, according to healthcare.gov.
Having insurance through the marketplace results in three basic kinds of expenses:
- Monthly premiums: The amount you pay your insurance company each month for your plan
- Annual deductible: The amount you have to pay out-of-pocket for services before your insurance coverage kicks in
- Other out-of-pocket costs: Any health care costs that aren’t covered by your insurance.
“People need to find out how much will the premium be vs. out-of-pocket costs. What’s the deductible; what’s the co-insurance; what’s the co-pay? All those things are going to help someone balance what kind of insurance coverage they need,” Ahn says. “Maybe some plans have a lower premium but a higher co-pay or deductible. If you’re using insurance a lot, you won’t want that plan because it might be more expensive in the long run despite the lower premium.”
Don’t be surprised if costs for some insurance plans in the marketplace go up for 2016. It can save you money to investigate your options thoroughly, noting which plans have increased in cost. Any insurers in the marketplace that want to increase rates more than 10 percent have filed narratives available on the Centers for Medicare and Medicaid Services website at cms.gov.
Am I eligible for a subsidy under the Affordable Care Act?
According to information from the Kaiser Family Foundation, two kinds of subsidies are available under the Affordable Care Act: the advanced premium tax credit, which lowers your monthly premium payments, and cost-sharing reduction, which reduces your out-of-pocket expenses during the year for health care you receive.
Whether you qualify for a subsidy depends on your income in comparison to the federal poverty level; you can be eligible if you make up to four times that amount). Qualifying for a subsidy also depends on your family size and how much health insurance costs where you live.
The foundation offers a health insurance marketplace calculator on its website to help you determine whether you’re eligible for subsidies and how much various plans might cost.
How will the plan affect my access to care?
According to a September 2014 article in Consumer Reports, regardless of the plan you purchase, all plans will cover the following:
- Emergency services
- Laboratory tests
- Maternity and newborn care
- Mental health and substance-abuse treatment
- Outpatient care (including doctors and other services you receive outside of a hospital)
- Pediatric services
- Prescription drugs
- Rehabilitation services
- Preventive services such as mammograms, immunizations and management of some chronic diseases.
However, different plan types can provide for different levels of coverage for costs charged by doctors, hospitals, pharmacies, and healthcare providers inside and outside of the plan’s network. If you have questions about your plan’s coverage, it’s always important to ask.
“You may need to ask, ‘Is the doctor I like in the network? Is the hospital down the street covered by this insurance?’ ” Ahn says.
It’s important to know that if you’ve had a change of circumstances, for example an increase in health care costs or loss of household income, you should update your information.
“Things change. Health plans can change, prices can change, the value of your tax credit can change,” Ahn says. “You absolutely must update your information.”
If you’re planning to purchase insurance from the marketplace, you can preview plans and prices in your area, apply online, or find more information at www.healthcare.gov.
Megan Craig is a Chicago-based journalist and communications professional who writes mostly about personal finance and consumer issues. She is a former reporter and editor for the Chicago Tribune. Follow her on Twitter @megcraig1.