(This article was last updated on May 29, 2018)
Whether you’re new to health insurance or it’s been a while since you’ve checked out the marketplace, you may have questions about how the whole thing works. What is the marketplace, and what can it do for you? Under the Affordable Care Act, federal and state health insurance exchange sites were set up to make buying health care coverage more convenient and more affordable. In the following sections, we’ll give you some information on the exchanges and how you can use them to your advantage.
The ACA Marketplace
Before the ACA became law, most people with insurance signed up for coverage through work. The rest sought coverage directly through insurance companies or by working with a broker who was licensed to sell products on behalf of several insurers. These methods worked for the majority, but millions of Americans had little to no access to health insurance under these conditions. The U.S. Census Bureau reports that uninsured people are more likely to have incomes below $25,000 annually. They’re also more likely to be Hispanic, to live in the south, and to be younger than 34.
Despite the statistics, it’s impossible to pinpoint the exact reasons why someone would forego insurance, but cost has a lot to do with it. Health insurance has always been expensive, but the ACA wants to change that. By opening a health insurance exchange site in which insurers can compete for consumers’ business, the ACA helps drive down the cost of coverage. Subsidies, which are advance premium tax credits available to low-income Americans, also lower costs for many families. We’ll talk about subsidies in the next section.
Premium Cost Assistance
Aside from the convenience of shopping for and comparing insurance plans, the marketplace offers people the chance to take advantage of cost assistance in the form of advance premium tax credits, also called subsidies. These subsidies can be applied toward the premium cost of any plan available on the marketplace, but the rate is based on the cost of the second-lowest silver plan on the marketplace. For an explanation of the plan tiers, see the last section on this page.
How do you qualify for subsidies? ACA guidelines require you to fall between 100 and 400 percent of the federal poverty line in order to apply for assistance. Don’t worry about following complicated procedures in order to sign up. When you register for the marketplace and enter your income information, the system will tell you automatically if you qualify for assistance.
You can also apply for out-of-pocket help on the marketplace, which is a special offer available to people whose incomes meet specific parameters. Unlike the tax credit, the out-of-pocket assistance doesn’t come until after you file your annual taxes, but it can help you recoup some of your annual health care costs, including deductibles and co-payments. In order to take advantage of out-of-pocket help, you have to be enrolled in a silver-level plan.
Most people who sign up for insurance using the marketplace qualify for assistance. According to the Department of Health and Human Services, about 71 percent of people who signed up for health insurance in 2017 received premium tax credits. Last year, the average subsidy was worth $371 a month, which represents a significant portion of the average premium price of a marketplace plan before cost assistance, which was $476 per month.
In 2018, 85 percent of enrollees were eligible for a subsidy – with an average subsidy was $468 a month – which brought down the average premium price of a marketplace plan by a total of 86 percent.
If it’s outside of open enrollment but you want to estimate how much of a subsidy you might be eligible for, then check out the subsidy calculator available from the Kaiser Family Foundation. This will give you some idea of what you might expect once open enrollment starts.
Important Dates to Remember
The marketplace isn’t open all year. For marketplace and privately purchased plans, there’s a set time when you can enroll called the open enrollment period. For coverage beginning in 2018, the open enrollment period ran from November 1, 2017 to December 15, 2018. The 2019 open enrollment period starts on November 1, 2018 and ends on December 15, 2018. Outside of these dates, you can only sign up for marketplace coverage if you qualify for a special enrollment period, which is triggered by having a qualified life event. The special enrollment period starts on the date of the qualified life event and ends 60 days thereafter. If you don’t enroll during this time, then you won’t be able to get a private health insurance plan (non-work-sponsored) on or off the marketplace.
If you forego health insurance for the entire 2018 calendar year, then you’ll pay a fee for non-compliance. When you file your 2018 taxes, you’ll be charged the greater of $695 per adult in your household or 2.5 percent of your taxable household income. Congress abolished the individual mandate penalty in the tax bill it passed late in 2017, which means that starting in 2019, people won’t be penalized for being uninsured.
Medicare, Medicaid and CHIP
Government programs like Medicare, Medicaid and the Children’s Health Insurance Program operate outside of the marketplace. If you register with the exchange and qualify for Medicaid or CHIP, then you’ll be redirected to the appropriate website for completing enrollment. You can sign up for these programs at any time if you’re eligible. Medicare enrollees will use the Social Security Administration website to sign up when they become eligible. If you’ve never qualified for Medicaid before, check with your state to see if things have changed. Under the ACA, states have the option to expand their Medicaid programs to include people who earn up to 133 percent of the federal poverty line.
How the Marketplace Works
There are two types of marketplaces: the federal site at Healthcare.gov and your state’s individual marketplace if it has one. Not every state developed its own exchange because the Supreme Court ruled that states could decide whether to create a site or not. To date, just . The District of Columbia also runs its own separate exchange. The rest of the states either redirect residents to the federal exchange or partner with the federal government in a hybrid marketplace.
The exchanges offer four metal plans at different tiers: bronze, silver, gold and platinum. All plans cover the same essential benefits but at varying levels. Bronze plans have the lowest premiums but the highest out-of-pocket costs; they typically pay 60 percent of your costs. Platinum plans pay 90 percent but have substantially higher premiums. You can also sign up for a catastrophic plan if you’re under 30 or you meet the hardship exemption.
We offer guidelines on how to sign up for health insurance on the marketplace in a separate article. It’s important to note that you don’t have to use the federal exchange or your state’s marketplace to sign up for health insurance. You still have all of the options that existed before the ACA became law. Now, you have an extra option. The only reason that you would have to use the marketplace is if you needed cost assistance.
(This article was updated on October 24, 2016)
What is the Health Insurance Marketplace?
The [hnd word=”Health Insurance Marketplace”], which is also referred to as ‘the marketplace,” ‘the health insurance exchange” or ‘the exchange,” is a web portal that consumers can use to sign up for private health insurance. There’s a federal site (Healthcare.gov) and state-sponsored sites. Only 12 states and Washington, D.C. have their own exchanges. All other states direct residents to use the federal site. You can use the marketplace to compare health insurance options and apply for subsidies to offset your costs. The following information will provide you with an explanation of how the marketplace operates, including federal and state exchanges, and how you and your family can qualify for lower monthly insurance premiums and reduced out-of-pocket expenses under the Affordable Care Act (ACA or [hnd word=”obamacare”]).
Note that there are other ways to get ACA-compliant healthcare coverage. You can enroll in a plan through your employer if available; you can shop directly with an insurance company; you can enlist the help of a licensed health insurance agent for free, which you can do through this website; or you can shop and review all of the plans available to you in your geographic region on a website like this one.
For health insurance coverage for the 2017 calendar year, the Health Insurance Marketplace will be open from November 1, 2016 through January 31, 2017. In several of the previous enrollment periods, the government has offered special signup extensions for various reasons, among them confusion about the process itself and technical problems with early versions of the website. This year’s enrollment period should go as expected. That means you’ll only have three months to make changes to an existing policy or sign up for new coverage unless you qualify for a special enrollment period. If you don’t sign up during open enrollment and you don’t qualify for an exemption from the individual mandate, then you will be charged a penalty fee for not complying with the healthcare law.
The next open enrollment will begin on November 1, 2016 and will end on January 31, 2017!
How the ACA Benefits You
The Affordable Care Act sought to cut healthcare costs, increase the quality of health insurance and reduce the number of uninsured Americans. Under the ACA, insurance companies are required to offer health insurance policies that cover 10 essential benefits, and they can’t discriminate against people with pre-existing conditions. The new law is designed to roll out certain benefits and features by 2020, changing the landscape of the American health care system along the way. Some of the ACA’s key features include:
- Guaranteed coverage: Companies now have to offer coverage to all applicants regardless of medical history, sex and other factors. Also, insurers can’t drop your policy without cause (typically nonpayment of premiums) or because you develop an illness.
- Minimum essential benefits: All plans created after March 23, 2010 have to offer 10 essential health benefits, which include services like preventive care, maternity care, prescription drugs and hospitalization. Plans also have to adhere to the new law’s standards for minimum essential coverage.
- Affordability: New health plans should be affordable, but there’s extra help available to people who fall between 100 and 400 percent of the federal poverty level (FPL) in the form of federal subsidies. These subsidies make buying health insurance especially affordable for low-income families.
- Health insurance exchange sites: Websites have been created to help people compare and buy policies while gaining federal subsidies.
- Medicaid expansion: The ACA expanded Medicaid, but states can choose whether to expand their programs or not. Expansion made it possible for adults without dependents and people without disabilities to enroll in Medicaid. In addition, if you earn up to 133 percent of the FPL (really 138 percent based on the way income is calculated), you can now qualify for Medicaid in the states that expanded their programs. The old standard was 100 percent.
The Importance of the Health Insurance Marketplace
The health insurance marketplace is a platform that was designed to help Americans buy affordable, subsidized health insurance without the assistance of a broker. The marketplace oversees and simplifies the process of buying health insurance by ensuring that coverage requirements are met in accordance with the Affordable Care Act.
Health insurance purchased through the exchange sites can be substantially less expensive than purchasing coverage directly from an insurance [hnd word=”carrier”], particularly if you’re eligible for a federal subsidy. On-marketplace premiums are extremely competitive already, and purchasing health insurance through the federal or state marketplace is the only way Americans can receive upfront tax credits on their health insurance premiums.
Additionally, although you can get information about whether you qualify for Medicaid or the Children’s Health Insurance Program (CHIP) via the federal marketplace, the actual application for these programs must be filed through your state website for each program. After determining whether you’re eligible for CHIP or Medicaid in your state, the website should direct you to the correct state site to begin the enrollment process. Medicaid and CHIP enrollment are year-round, so you can sign up at any time if you’re eligible.
If you’re a small business owner and want to obtain healthcare coverage for your employees, you can shop for insurance on the marketplace as well as long as you have fewer than 50 employees. Your marketplace is called the Small Business Health Options Program (SHOP). This is also a year-round opportunity. Small businesses do not have to provide coverage for their employees under the law, but there are financial incentives for doing so.
Medicare plans are not sold on the marketplace. If you want to learn more about signing up for Medicare once you’re eligible, check out our site on Medicare enrollment.
Are People Enrolling in Obamacare?
In short, the answer is yes. According to the Department of Health and Human Services (HHS), which oversees and implements policies under the Affordable Care Act, about 12.7 million people signed up for health insurance during the 2016 enrollment period. This figure includes both renewals and new signups. It also brings the total number of people who have gained health insurance to 20 million since the ACA became law.
Over the years, enrollment has been steady. In November 2013, there were four times the number of new enrollees as there were in October of the same year. Within the first two months of the initial [hnd word=”open enrollment period”], more than 1 million people signed up for health insurance. Of those 1 million people, 364,682 people enrolled in plans on federal or state marketplaces. By the end of the inaugural enrollment period, about 8 million people had signed up for coverage.
The ACA targets young adults aged 18 to 34 because this demographic is the most likely to be healthy and require less health care. During the initial enrollment period, 2.2 million young adults signed up for health insurance. Enrollment for this demographic has not been as robust as lawmakers anticipated or wanted, but there have been improved efforts at reaching younger enrollees. One of the goals for open enrollment 2017 is to increase awareness among young adults in the hopes that they sign up in larger numbers. Last year, 2.7 million people aged 18 to 34 enrolled in health insurance. Enrollment for this group remains steady, but the government is hoping that stronger marketing efforts will attract greater numbers going forward.
At the close of the 2014 open enrollment period, 98 million people passed through the state and federal marketplaces while nearly 33 million calls were taken at call centers for both state and federal marketplaces. During the 2016 enrollment season, there were over 9.6 million plan selections on the federal marketplace. Call center volume topped 14.5 million people, and there were over 29 million Healthcare.gov users.
In terms of financial assistance, the marketplace is helping millions of people gain access to affordable coverage due to subsidies. In 2014, the CBO reported that 5 million people qualified for subsidies during the initial enrollment season and projected that this figure would double in 2015. They were right. At the end of the 2016 enrollment season, 83 percent of people who bought health plans on the marketplace took advantage of subsidies – that’s 10.5 million people.
Who are the Uninsured?
The uninsured rate varies by region, age, race and ethnicity. According to the U.S. Census Bureau, individuals with an annual household income below $25,000 are at a greater risk of being uninsured. Hispanics, people living in southern states and young adults aged 18 to 34 also have a greater probability of being uninsured.
How Did Most Americans Receive Health Insurance Coverage Before Obamacare?
Prior to Obamacare, most Americans received health insurance coverage through their employer or government administered plans such as Medicaid. Individuals who presently receive coverage from their employers or from their state are likely to keep their present coverage. Employer-based coverage remains the most common form of health insurance.
Technical Problems with the Healthcare.gov Website in 2014
When the Healthcare.gov website originally launched on October 1, 2013, there were problems with the website, largely due to the high volume of people visiting the site simultaneously. These problems were resolved relatively quickly, and the website remained pretty through the end of the 2014 open enrollment period. Technical difficulties at the outset of the program have continued to dissuade people from signing up for health insurance even now. You should know that the website is now functioning as intended. Similar issues have plagued some state exchange sites, but these sites have also had three years to improve access and should be fully functional during 2017 open enrollment.
Who is Expected to Use the Health Insurance Marketplace?
The marketplace was designed for uninsured Americans who are seeking affordable health insurance premiums, both for individual and family coverage. It’s not intended for people who already have affordable health insurance through an employer, a private insurance company, or the Medicaid or CHIP program. However, you can buy marketplace coverage if you already have a plan in place through work or an off-marketplace insurer. You’ll need to wait for open enrollment to sign up unless you qualify for a special enrollment period. Also, you should keep in mind that work-based plans are typically more affordable than unsubsidized marketplace plans because your employer is paying for a portion of your premium. According to Healthcare.gov, there are only three eligibility requirements for using the marketplace:
- You have to live in the United States.
- You must be a U.S. citizen, a U.S. national or a lawfully present resident.
- You can’t be incarcerated.
U.S. citizens who live outside the country for 330 days in a 12-month period are exempt from the individual mandate to have health insurance. The bottom line is that if you’re uninsured and you don’t have access to quality, affordable health insurance, then you can utilize the marketplace to buy coverage. Some states have their own exchange site, so if you live in one of those states, you’ll sign up for coverage through a state portal. Start by visiting Healthcare.gov and entering your zip code. The site will redirect you to your state’s marketplace if your state has one.
If your annual income falls between 100 and 400 percent of the federal poverty level (FPL) and your employer does not offer health insurance, or you don’t have access to affordable health insurance, you may qualify for a premium tax credit, also called a subsidy, to make your insurance more affordable. Under the ACA, Medicaid has been expanded in states that opt to accept the new guidelines. If your income is less than 138 percent of the federal poverty level, then you may qualify for Medicaid in states that expanded the program. Medicaid is still available to people whose incomes fall below 100 percent of the FPL even in states that didn’t expand the program.
Medicare participants cannot use the health insurance marketplace. Under the ACA, Medicare Part A on its own counts as minimum essential coverage, so if you have Part A, then you’re compliant with the law. Part B on its own does not count, so you’ll need to get Medicare Part A or a supplemental plan (like Medicare Advantage) if you want to adhere to the new law and avoid a tax penalty. If you qualify for Medicare, the marketplace will let you know, and you’ll be directed to enroll on the appropriate site instead.
Small business owners can use the Small Business Health Insurance Options Program (SHOP) to buy coverage for their employees, but if your business has fewer than 50 employees, you’re not required to offer health insurance. You may qualify for financial incentives, however, if you do offer coverage.
State, federal and local government-administered health insurance programs do not need to use the health insurance marketplace.
Important Facts About the Health Insurance Marketplace
There are plenty of myths and lots of misinformation swirling around about health insurance under Obamacare. Here are a few facts about the marketplace:
- Starting in 2014, all Americans were required to have health insurance, with few exceptions. The health insurance marketplace enables people to sign up for coverage from private insurers and use federal subsidies to make that coverage more affordable.
- Pre-existing conditions will no longer prevent you from getting health insurance on the exchanges. No one can be denied coverage for health reasons thanks to the Affordable Care Act.
- Monthly health insurance premiums are no longer determined by health status, pre-existing conditions, claim history, coverage duration, gender, occupation, work industry or an employer’s size.
The marketplace is open and available to anyone who wants to use it, but you don’t have to sign up for health insurance on an exchange site. You can use the marketplace, go through a third-party entity or enroll directly with an insurer.
If you like your current coverage, you can keep it. You’re not required to change your health plan unless the company no longer offers it.
You can use the marketplace to shop for yourself and your family. Premiums might be more affordable on the marketplace with or without federal subsidies. Small business owners can use the SHOP portal to buy coverage for their employees, but if you employ fewer than 50 people, you’re not required to offer coverage for their workers. However, there are tax incentives for offering coverage if you’re a very small business.
If your income falls between 100 and 400 percent of the federal poverty level, then you may qualify for cost assistance in the form of subsidies. These subsidies can substantially lower your monthly premiums.
Open enrollment typically starts in the fall. For 2017, the signup period will run from November 1, 2016 through January 31, 2017. Special enrollment periods may help you get coverage if you meet certain qualifying life events.
If you buy health insurance from the marketplace by the 15th of the month, then your coverage will start on the 1st of the following month if your premiums have been paid. For plans purchased after the 16th, coverage will begin on the 1st of the month after the following month. Example: You buy a plan on January 16th during open enrollment. Your coverage would begin on March 1st if you’ve paid your premiums.
- Applying for coverage is different from enrolling in coverage. When you apply, you’re providing the marketplace with necessary information – such as your name, family size, job and income – so that the system can determine your eligibility for subsidies and insurance. Once you’ve been approved, you can enroll in (sign up for) a health plan.
If you have questions about open enrollment outside of the health insurance marketplace, then you should ask your health plan administrator (through work) or a state-administered agency. You can find a wide variety of health plans on the marketplace during open enrollment, but again, it’s not your only option for signing up. You can enroll in a work-based plan if available, or you can sign up through an independent broker, third-party website like this one or directly with an insurer.
What is Affordable Health Insurance?
‘Affordable” can mean different things to different people, and it means different things even within the scope of the Affordable Care Act. For a health plan to be ‘affordable” on the marketplace, it can’t cost more than 8.13 percent of your household’s total annual income (8.16 percent for plans in 2017). If you can’t find a plan that costs less than this, then you’re eligible for an exemption from the individual mandate to have health insurance. The same holds true for work-based coverage. If your employer’s plan would cost more than 8.13 percent of your household income, then you can apply for an exemption from the individual mandate.
For people who buy work-based coverage, there’s another rate of affordability. If an employee self-only plan (one that covers just you and not your other household members) costs more than 9.66 percent of your household income (9.69 percent in 2017), then it’s considered unaffordable. You can then shop for coverage on the marketplace and apply for subsidies to bring down your premiums.
When did the Health Insurance Marketplace Open?
The next enrollment period starts on November 1, 2016 and ends January 31, 2017 for 2017 coverage. If you qualify for a special enrollment period, then you typically have 60 days to enroll outside of the open enrollment period. Those who qualify for Medicaid or CHIP can apply at any time during the year.
Do I have to use the marketplace if I do not have health insurance?
The short answer is no. You don’t have to use the marketplace to sign up for health insurance.
There are several advantages to using a federal or state marketplace to buy insurance. Cost assistance (in the form of federal subsidies) is only available through health insurance exchange sites, and you can also find out if you’re eligible for Medicaid or CHIP when you register. You’ll also be able to see different plans side by side, making comparing coverage easier.
However, you can also sign up for health insurance through a private broker, directly with an insurance provider or by using a site like this one. We also have agents who can answer your questions and help you find products that work for your family, needs and budget. The Affordable Care Act simply added one extra way for consumers to purchase health insurance, via the marketplace. Your other options for enrolling haven’t changed.
If you don’t have health insurance and you don’t qualify for an exemption from the mandate, then you will be fined in accordance with the law. The IRS has the authority to collect this shared responsibility payment when you file your taxes for the year. In 2016, the fine is $695 per adult and $347.50 per child, per household, or 2.5 percent of your household’s taxable income, whichever is greater. The fee increases each year based on inflation. You’re only charged for the months that you don’t have coverage, so if you spend half of 2017 without health insurance, you’ll only be taxed for six months. Still, the fee can add up, and you won’t gain all the benefits that come from having health insurance. Preventive care, emergency room coverage and prescription drug coverage – among other essential benefits – can save you a lot of money in the long run.
Minimum Essential Coverage
All health insurance plans purchased through the health insurance marketplace provide minimum essential coverage, so you don’t have to worry about what your policy covers in terms of the basics. Under the Affordable Care Act, every insurance company must cover the following care and services. Any policy that does not cover these services will not meet the requirements of the law.
- Ambulatory (outpatient) care
- Emergency services
- Inpatient hospitalization
- Maternity and newborn care
- Mental health and substance use disorder care
- Prescription drug coverage
- Rehabilitative and habilitative services
- Laboratory services
- Preventive services, wellness services and chronic disease management
- Pediatric services, including dental and vision care
Competitive Rates at the Health Insurance Marketplace
Health insurance rates for plans on the marketplace are generally much lower than rates that you might find directly from an insurance carrier, primarily because insurance companies are competing against each other for your business on the exchange sites.
What Type of Health Insurance Coverage Can Be Purchased at the Health Insurance Marketplace?
When purchasing health insurance through the marketplace, you have the flexibility of choosing between four tiered options: bronze, silver, gold and platinum. There are also catastrophic plans for young adults under age 30 or those who qualify for a hardship exemption. It’s important to note that the tiers are not referring to the quality of the services that you’ll receive. Rather, each tier describes how you and your health plan will split the cost of your care via copayments, coinsurance and out-of-pocket spending. With a bronze plan, the average out-of-pocket spending is 40 percent, which means that you’ll pay (on average) 40 percent of the costs for your medical care. Platinum plans, on the other end of the spectrum, cover about 90 percent of your costs. Bronze plans have the lowest premiums but highest out-of-pocket expenses while platinum plans have the highest premiums and lowest out-of-pocket expenses. Most people on the marketplace choose a silver-level plan.
How do I Decide Which Insurance Plan to Purchase?
Although it may be tempting to purchase a health insurance plan that costs less, consider the needs of your family, financial obligations and medical history before signing up for the least expensive option. Although most medical procedures are covered for all tier types, you’ll typically pay less out of pocket with a higher-tiered plan. One simple medical emergency can make a huge financial impact, but the financial losses can be minimized depending on your coverage.
There are three types of cost assistance options available when shopping for healthcare coverage on the marketplace:
- Medicaid/CHIP. Medicaid and the Children’s Health Insurance Program (CHIP) are for people whose income falls below their state’s financial levels. If you live in a state that did not expand Medicaid eligibility requirements, the level is 100% of the federal poverty level (FPL). If your state did expand the eligibility requirements, the level is 133%. Because of the way that Medicaid actually calculates the income requirements for the program, families who make under 138% of the FPL are eligible for Medicaid in states that expanded the guidelines. CHIP is a program for children whose parents did not qualify for Medicaid. The requirements for CHIP enrollment vary per state. If you think your children may qualify, check with your state for more information.
- Out-of-pocket help. Out-of-pocket help offers assistance with out-of-pocket costs for people who earn below 250 percent of the FPL. This tax credit will be applied when you file your income taxes and can be used as a reimbursement for various expenses, such as deductibles, copays and coinsurance payments that you made throughout the year. You must be enrolled in a silver-level plan to take advantage of out-of-pocket help.
- Premium tax credits. Premium tax credits (or subsidies) are available for people whose incomes fall between 100 and 400 percent of the FPL. You can only apply for subsidies on the health insurance marketplace. If you qualify for a subsidy, you can apply it to your monthly premium costs up front or at the end of the year as a tax credit.
Do I Need to Shop for Health Plans Prior to Applying for Subsidies?
No. Once you apply on the marketplace, you’ll be notified of eligible cost assistance options. When you review the health insurance rates online, the subsidies will be calculated automatically into the monthly premiums. Estimates are also provided online at Healthcare.gov. However, you should complete a full application to receive an accurate insurance quote. The marketplace offers subsidies to people who aren’t receiving health benefits through an employer-based health insurance program or Medicaid. These subsidies are provided in the form of tax credits or out-of-pocket credits. For households that fall below 400 percent of the FPL, credits will be applied to the monthly premiums. It’s important to notify the marketplace about household financial changes. If you don’t, then you may be held liable for any differences in premiums on future tax returns.
Qualifying for Medicaid, Medicare or CHIP
Once you complete your online application for health insurance coverage, you’ll be notified about applicable subsidies or assistance programs. If you qualify for Medicaid, Medicare or the Children’s Health Insurance Program (CHIP), you will not be able to purchase coverage through the marketplace. You’ll be redirected to the correct website for the program in your state. Additionally, a representative from the appropriate government agency may contact you regarding the application that was completed through the marketplace. If you think you might qualify for a government assistance program, research the financial requirements ahead of time so that you understand your rights and obligations.
Purchasing Health Insurance Within the Marketplace
If you want to take advantage of federal subsidies to offset the cost of your coverage, then the marketplace is your only choice for buying health insurance. Signing up for coverage through an exchange is straightforward if you follow the instructions carefully. Start by visiting Healthcare.gov. If your state has its own exchange, you’ll be directed to the appropriate website. If not, you can use the federal site to sign up. Keep in mind that you can also enroll in health insurance by using a site like this one, a broker or an insurance carrier directly.
How Can I Sign Up on the Health Insurance Marketplace?
There are several ways to sign up for health insurance using the marketplace:
- Speak with a license insurance agent via phone, online or in person to help you shop for all the plans that are available in your location.
- Shop and compare all the plans that meet your criteria in your geographic region through a website like this one.
- Check out your individual state marketplace site, a list of which is available on Healthcare.gov.
- Sign up on the federal marketplace at Healthcare.gov.
- Call the federal marketplace toll-free line, which offers 24/7 assistance, at 1-800-318-2596.
- Submit a paper application by mail. (Note: You can start an application by mail, but you’ll need to call or visit the website to finish enrolling.)
How to Sign Up with the Health Insurance Marketplace Online
- Create a new account. You’ll choose a username and password, and answer security questions.
- Complete the online application. When completing the online application, you’ll be asked to provide various types of information, such as your household income, household size and current health insurance information. This information will help the marketplace present you with the most competitive insurance rates. For households that file more than one annual tax return, the marketplace requests that you call before you start. Their number is 1-800-318-2596 (TTY: 1-855-889-4325). This information is very important for the application process to run smoothly.
- Review your options. Once the application process has been completed, you will be able to view all the health insurance options that you qualify for, including Medicaid, CHIP and subsidized insurance plans. If you’re approved for subsidized healthcare through the marketplace, you’ll be able to view health insurance premiums, deductibles, out-of-pocket expenses, coinsurance rates and copayment amounts.
- Enroll. Once you’ve decided on the health plan that meets your needs and budget, you can enroll online and select a payment structure. If you qualify for Medicaid or CHIP, a representative from the appropriate state agency will contact you for enrollment.
Regulated Health Plans – ACA Compliant Plans
All health plans that are purchased through the marketplace are compliant with the Affordable Care Act, meaning that they meet minimum essential coverage requirements under the law.
Avoiding Increases in Your Monthly Premiums
Companies can no longer discriminate against people based on medical history or health status, but certain factors may raise your premium rates – like being a smoker. In order to maximize your health insurance, talk to your doctor about lifestyle changes that may improve your health. Under the ACA, preventive care is an essential benefit. That means that preventive visits, like wellness screenings or certain kinds of tests, will be covered without copays or extra charges. If you have a family, get them on board, too. The healthier you are, the less medical care you’ll need in the long run, which can reduce your out-of-pocket expenses.
Small Business Health Options Program (SHOP)
For small business owners, there’s a special way to get coverage for employees. If you have fewer than 50 full-time equivalent employees starting in 2016, then you can use the Small Business Health Options Program (SHOP), which is administered by Healthcare.gov. Under the ACA, you do not have to offer health insurance to your employees if you have fewer than 50 full-time workers, but there are financial incentives for doing so. For very small businesses – those with fewer than 25 full-time employees – there’s a tax credit worth up to 50 percent of the cost of premiums if you offer insurance to your workers. You can learn more about the SHOP on the federal marketplace website.
What are the Income Requirements for Saving on Health Coverage?
How much you save on insurance through the marketplace depends on your income and other factors, like household size. Insurance premiums vary by state and region. The following table outlines the income limits for various family sizes and what those limits mean in terms of federal subsidies and Medicaid eligibility. Healthcare.gov uses the 2016 federal poverty level (FPL) numbers to determine Medicaid and CHIP eligibility. For subsidy eligibility, the marketplace uses 2015 numbers, which are slightly lower. These rates apply to the 48 contiguous states and Washington, D.C. The poverty level is higher for residents of Alaska and Hawaii.
Income Thresholds to Qualify for Cost Assistance in 2017
|Insurance Type||Subsidy||Subsidy with out-of-pocket help||Medicaid & CHIP (not expanded)||Medicaid & CHIP (expanded)|
|Individual||Between $11,770 and $47,080||Between $11,770 and $29,425||Below $11,880||Below $16,394.40|
|Family of 2||Between $15,930 and $63,720||Between $15,930 and $39,825||Below $16,020||Below $22,107.60|
|Family of 3||Between $20,090 and $80,360||Between $20,090 and $50,225||Below $20,160||Below $27,820.80|
|Family of 4||Between $24,250 and $97,000||Between $24,250 and $60,625||Below $24,300||Below $33,534|
To qualify for a subsidy, you need to earn between 100 and 400 percent of the federal poverty level (FPL). If you need out-of-pocket cost assistance and buy a silver-level marketplace plan, you can qualify if your income is between 100 and 250 percent of the FPL. If your state did not expand Medicaid eligibility, your income can’t exceed 100 percent of the FPL. In states that did expand Medicaid, the threshold is 138 percent of the FPL.