The New Health Insurance Marketplace

The Affordable Care Act (often referred to as Obamacare) introduced numerous changes in the health insurance industry, including the establishment of a so-called health insurance marketplace.

The Affordable Care Act established the marketplace/exchange to make it simple for uninsured people to purchase one of the individual health insurance plans being offered through it during an annual Open Enrollment period. The marketplace/exchanges were designed to enable users to determine if they are eligible for premium subsidies and apply for them. Those who earn too much to qualify for subsidies can purchase health insurance through the marketplace/exchange or through an insurance broker. Those eligible for a subsidy must go through the marketplace.

 

Coverage Available Through Marketplace

The types of coverage available through the marketplace are in four tiers based on the benefits offered and on out-of-pocket costs. The levels are:

  • Platinum (the most expensive and having a 10 percent out-of-pocket cost level)
  • Gold (20 percent out-of-pocket cost level)
  • Silver (30 percent out-of-pocket cost level)
  • Bronze (the least costly premium-wise, with 40 percent out-of-pocket level)

Some states established exchanges that defined essential health benefits that plans must provide at each level. They then selected and certified plans to be offered at each level. Other states chose to have the federal government directly facilitate their exchange. So, given the variations by state, there will be specific plans available at each level through the marketplace depending on where you live. As well, other options that meet your needs and budget may be available through a broker.

Comparing Plan Options

When comparing plans available to you through the marketplace or an insurance broker, consider your monthly premiums and your out-of-pocket costs (copayments, deductibles, coinsurance, and out-of-pocket maximums), but also consider your anticipated needs, the types of plans, the providers available to you, and the benefits offered. All plans offer the same preventive care and essential coverages, but some offer additional benefits or more flexibility.

Enrollment Period

The initial enrollment period ended on March 31, 2014. The next annual enrollment is scheduled for November 15, 2014 through February 15, 2015. Much like an employer’s plan, you have to have a Qualifying Life Event (e.g. job change, involuntary loss of other coverage, marriage, divorce, birth of a child, etc) to make plan changes or to purchase a marketplace health insurance plan until the annual enrollment period. You can cancel coverage at any time however with the limitations in the insurance market today, purchase health insurance coverage through an insurance broker who has the knowledge and expertise on what can and can’t be done.

The “SHOP”

The Affordable Care Act also created the Small Business Health Options Program (SHOP) Marketplace to help small businesses provide health coverage to their employees. This is completely different from the health insurance marketplace for individual policies. However, due to significant changes and rising costs of Traditional Employer based Group Health Insurance, many employers and small business owners are seeking more affordable group health insurance options. One of the best options are a “Defined-Contribution Plan” as an affordable insurance solution for their organizations. Contact us or call now at 877.749.2241 to speak with a Health Insurance Specialist to learn more about these new affordable Defined Contribution Plans.

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