Affordable Health Insurance
Finding an Affordable Health Insurance Plan in the Marketplace
The Affordable Care Act, also know as Obama Care, is a very complex piece of legislation that has generated a lot of contradictory information. Determining the best health care option for you and your family is a complicated process that involves taking an objective look at the different types of plans, levels of service and tax implications.
If you live in a state that has set up its own health insurance exchange, you will use that site to pick your plan and sign up for health insurance. If not, you will sign up via the Federal health insurance exchange at healthcare.gov. If you are unsure which site to use, just head over to healthcare.gov. If your state has set up an exchange, the site will automatically send you there.
Shop and Compare
The ability to shop and compare plans and prices is particularly valuable, since most consumers should qualify for help paying for the health insurance they need. These subsidies are at the heart of the Affordable Care Act, and they can substantially lower not only the premium costs but the out-of-pocket expenses as well.
Once you click on the "See Plans & Prices" link you will be prompted to enter your age, the state you live in your expected income for the coming year. It is important to be as accurate as possible, so having a copy of your most recent tax return is a good idea. The premium help you qualify for is based on your income and household size, so the more complete the information you provide the better.
Review Your Plan Options
Once you have entered your income, household size, ZIP code and other details, you will see a list of plans available in your area. The prices shown are after the applicable premium tax credit has been applied. If the monthly premium is $300 and you are eligible for a $250-a-month tax credit, you will see the price listed as $50 a month. You will find the total premium listed in smaller print, making it easier to compare cost and coverage.
Advance Tax Credits
The premium help in the Affordable Care Act is actually an advance tax credit. You can use the tax credit to offset the cost of your premiums now, or take the money later in the form of a larger tax refund.
If you overestimate the amount of income you earn, you may be eligible for a larger refund when you file your taxes next year. If you underestimate how much you make, you may have to pay some of that money back. It can be a difficult balancing act, but if your income is steady from year to year you should not need to worry too much.
Setting Up Your Account
Once you have found a plan that works for you, it is time to set up your account on the health insurance exchange and start shopping. You will need your email address to sign up for coverage, and you will need to create a username and password as well. Be sure to record the user information you choose and keep it in a safe place.
Once you have created and confirmed your account, you are ready to go through the application and choose your health insurance plan. The application process has been streamlined this year, and the entire signup process should take less than an hour.
You will be asked a number of questions during the application process, including how many people live in your household, what you expect your income to be this year and where you live. If you expect your income to be the same as last year, having a copy of your income tax return will be extremely helpful. If your income will be different this year, try to gather as much information as you can before you apply.
Once the application process is complete, you will be directed to a list of the health insurance plans available in the marketplace. If you used the shop and compare feature earlier, this page should look very familiar. Just choose the plan you want and verify your choice to sign up. If you wish, you can make your first premium payment right from the site. If you choose this option, the healthcare.gov site will direct you to the website of the insurer you have chosen. If you do not use this option, the health insurance exchange will send your information to the insurer and they will send you a bill.
Health insurance is not the only coverage available on the health insurance exchange. The Affordable Care Act also provides access to dental care, and choosing a plan is part of the signup process. As you navigate through the screens, you will have a chance to shop for dental coverage or decline and choose health insurance alone.
The process for dental coverage is similar to that for health insurance. When you click the dental coverage option you will be directed to a screen listing companies, coverage and monthly premiums.
It is a good idea to shop around for dental coverage on your own before visiting the marketplace. Shopping ahead of time will make it easier to compare coverage options and prices. Sometimes the prices on the health insurance exchange will be better. Other times they will be higher than what you could find on your own.
Understanding the Premium Tax Credits
The premium tax credit is an integral part of the ACA, and it is important to understand how they work. The premium tax credits are applied on a sliding scale based on income and family size. Basically the less you make the higher your tax credit should be. You should not assume that you make too much to get a credit, however. Those tax credits are available for individuals who make up to 400% of the Federal Poverty Level (FPL). For 2015 that means a single person making less than $46,680 may be eligible for help. For a family of four, that threshold is $95,4001 .
If you want to see how much premium help you may be eligible for without going to the health insurance marketplace, you can use the handy calculator created by the Henry J. Kaiser Foundation. The calculator is simple to understand and use. Just enter your family size, income, state and ZIP code and let the calculator do the rest.
The Kaiser calculator will also tell you if you may qualify for Medicaid or another Federal program. The Affordable Care Act allowed states to expand their Medicare eligibility, opening up the program to individuals making up to 138% of the Federal Poverty Level (FPL). For 2015 that threshold is $16,105 for a single person and $32,913 for a family of four.
The Affordable Care Act has changed the way individuals buy health insurance. If you get your health insurance from your employer, you will not have to worry about the marketplace. If not, it is time to head over to healthcare.gov and check out your coverage options. Time is running out, and now is the perfect time to get started. You have until February 15, 2015 to sign up for coverage, but the sooner you sign up the sooner your coverage can start.