As of late 2019, the Health Insurance Marketplace may still be your best bet to get adequate health insurance if you're not covered by an employer, a spouse's or parent's plan, or some other source.
And if you're getting by on a low income, browsing the Marketplace for a plan is a must. You may be eligible for extra savings that lower the amount you pay for your monthly health insurance bill, deductibles, copayments, and coinsurance.
- The Health Insurance Marketplace open enrollment period for 2020 runs from Nov. 1 to Dec. 15, 2019.
- Depending on your income, you may be able to lower your health insurance costs with premium tax credits and cost-sharing reductions.
- If you're under age 30 or you have a hardship exemption, you may be eligible to buy a Catastrophic plan with low monthly premiums.
The Health Insurance Marketplace
If you don't have health insurance through a job, Medicare, Medicaid, the Children's Health Insurance Program (CHIP), or another source, you can buy a plan on the Health Insurance Marketplace.
The Marketplace (or "Exchange") was created as part of the Patient Protection and Affordable Care Act of 2010—also known as Obamacare. Most people can use healthcare.gov to apply for and enroll in health insurance. However, you'll use your state's website to enroll if you live in one of the following states (current as of 2019):
- District of Columbia
- New York
- Rhode Island
Essential Health Benefits
Obamacare brought several key benefits to health insurance plans. One is that an insurance company can't deny you coverage (or charge you more) if you have a preexisting condition. Another is that preventive care—things like routine checkups and screenings—is covered at 100%, even if you haven't met your deductible yet.
Also, all plans offered on the Marketplace must cover the following essential health benefits:
- Ambulatory patient services
- Breastfeeding coverage
- Care for newborns and children (including dental and vision care)
- Emergency services
- Family planning coverage
- Laboratory services
- Mental health and substance use disorder services
- Occupational and physical therapy
- Paternity, maternity, and newborn care
- Prescription medications
- Preventive and wellness services and chronic disease management
When to Apply for Coverage
You may be eligible for a Special Enrollment Period if you have a "qualifying life event." That happens if you lose your existing health coverage, get married or divorced, have a baby or adopt a child, move to a different zip code or county, or have a change in income.
Otherwise, you have to shop for, apply for, and buy an insurance plan during the open enrollment period. But you have to act fast: The open enrollment period for 2020 runs for just six weeks, from Nov. 1 to Dec. 15, 2019.
Getting Started in the Marketplace
To get started, visit www.healthcare.gov or your state's version of the site.
Either way, you'll get a quick side-by-side comparison of the plans that are available to you.
The database allows you to choose from four tiers of health insurance: Bronze, silver, gold, and platinum. Bronze plans are the least expensive but require the highest copays and deductibles. Platinum plans are the most expensive, and they may have more bells and whistles than you want or can afford.
During the enrollment process, you'll learn whether you're eligible for the premium tax credit or a cost-sharing reduction—and if so, you'll find out how much you can save. If you do qualify for savings, you must buy your plan through the Marketplace.
The percentage of Americans who have employer-sponsored health insurance.
Comparing Health Plans
When you browse the Marketplace, you'll find that your choices come from private health insurance companies, including big names such as Blue Cross, Cigna, and Kaiser. The mix you get depends on where you live.
Each company offers a range of healthcare plans within the four metallic levels. The levels indicate the rough percentage of costs that the plan will pay towards your healthcare services:
|Plan Level||The Plan Pays||You Pay|
Bronze plans, for example, provide the lowest level of coverage (60%) but have the lowest monthly premiums. As the plan level increases, so do the coverage and your monthly premium.
Even within the same metallic level, you'll still be able to choose from several coverage options. These options affect both your premiums and out-of-pocket costs for deductibles, copayments, and coinsurance. Compare these two hypothetical silver plans for a 35-year-old non-smoker:
|Silver Plan “A”||Silver Plan “B”|
|Coinsurance||20% after deductible||30% after deductible|
As the table shows, Plan A will cost you more upfront for your monthly deductible, but your out-of-pocket expenses will be much lower. Conversely, Plan B will cost less each month, but you'll pay more for healthcare expenses because of the higher deductible, copayment and coinsurance amounts.
How to Lower Costs on Marketplace Insurance
Depending on your modified gross adjusted income and family size, you may be eligible for cost-sharing reductions and a premium tax credit to reduce your healthcare costs.
A Cost-Sharing Reduction is a discount available on silver plans only. This reduction can help lower your out-of-pocket costs for:
- Deductibles—the amount you owe for covered services before insurance kicks in.
- Copayments—a fixed amount you pay for covered healthcare services.
- Coinsurance—your share of the costs of covered healthcare service.
- Out-of-pocket maximum—the most you'll pay in a year for covered health expenses.
As an example, say you visit the doctor and are charged $100. With your particular silver plan, you normally have a copay of $25. Because you qualify for Cost-Sharing Reductions and you chose a silver plan through the Marketplace, your copay may be as low as $5.
Similarly, if your plan has a $3,500 deductible, it may be lowered to $500 with Cost-Sharing Reductions. Essentially, you pay for a silver plan, but receive the increased coverage of a higher metallic level plan, reducing your out-of-pocket expenses.
Cost-Sharing Reductions are available only to people:
- Who are ineligible for public coverage such as Medicaid or the Children’s Health Insurance Program,
- Who are unable to get qualified health insurance through an employer, and
- Whose incomes fall between 100% and 250% of the Federal Poverty Level.
Tip: In order to receive Cost-Sharing Reductions, you must enroll in a Silver plan through the Health Insurance Marketplace and apply for the subsidy. And it’s important to note, the cost-sharing subsidies only apply to in-network expenses, so you have to be mindful about where you receive healthcare.
Advanced Premium Tax Credits
Many more people qualify for an advance premium tax credit, which lowers your monthly health insurance bill for coverage bought through the marketplace. Like the Cost-Sharing Reductions, you must be ineligible for public coverage and unable to get qualified health insurance through an employer in order to qualify.
While you can choose any metallic level plan in the marketplace, your income must fall between 100 and 400% of the federal poverty level to qualify for the tax credit.
For 2019, you must make below the following amounts in order to be eligible for a subsidy: $45,960 for an individual, $62,000 for a couple, $78,000 for a family of three, or $94,200 for a family of four. In each case, that number represents four times the federal poverty rate for 2019.
Premium tax credits are sent directly from the government to your health insurer to lower your monthly premium. If you qualify, you can decide how much of the credit to apply to your premium each month, up to the full amount.
When you file your annual tax return, you'll "reconcile" the premium tax credits you received and the actual amount you qualify for, based on your final income for that year. If you've taken more payments than you're eligible for, you may have to pay the money back when you file your return. If you should have taken more, however, you may get a refund.
Estimating Your Subsidy
The Kaiser Family Foundation calculator is an online tool that shows the subsidy you might receive based on your expected 2019 income, the number of adults and children enrolling in coverage, their ages, and whether any of them use tobacco.
Tip: In order to receive this subsidy, you must apply for Advanced Premium Tax Credits on the Health Insurance Marketplace. This subsidy is not automatic. If you qualify, you can take advantage of both Cost-Sharing Reductions and Advanced Premium Tax Credits to reduce both your monthly premium and out-of-pocket costs.
Choosing Catastrophic Coverage
When you fill out an application online, you'll see catastrophic plans listed among your plan options only if you qualify for them. If you do qualify for and choose a catastrophic plan, you won't be eligible for either Cost-Sharing Reductions or premium tax credits.
A catastrophic health plan covers three primary care visits per year before the deductible is met. It also covers preventive services at no cost to you.
The premium you pay each month should be considerably lower than for other plans, but the out-of-pocket costs (deductibles, copayments, and coinsurance) are generally much higher.
You may be eligible for a catastrophic plan if you're under 30 years old or if you qualify for a “hardship exemption,” because you can't afford health coverage. This is determined during the application process and is based on your family size and income.
Qualifying for Medicaid
Depending on your income and family size, you may qualify for Medicaid, a program that provides health coverage for eligible:
- Low-income individuals, families, and children
- Pregnant women
- People with disabilities
Each state has its own rules about who qualifies for Medicaid. Under the Affordable Care Act, Medicaid eligibility expanded in many states, and an increased number of people qualified for benefits. If you are eligible, you can get free or low-cost coverage and you won’t need to buy a Marketplace plan.
Many states also have a separate program, the Children’s Health Insurance Program (CHIP), that provides health insurance for uninsured children in low-income families who don't qualify for Medicaid but cannot afford private coverage.
You can fill out an application on the Health Insurance Marketplace to find out if you are eligible for Medicaid or CHIP benefits. You can also visit your state’s Medicaid website to apply and find out if you qualify.
The Bottom Line
Many individuals and families will be able to compare and buy their 2020 health coverage through the Health Insurance Marketplace. After you fill out an application online, you can see if you qualify for Medicaid, CHIP, Cost-Sharing Reductions, and/or premium tax credits. You will also find out if you are eligible for a catastrophic plan that charges lower premiums but higher out-of-pocket costs.
In addition to Essential Health Benefits, all Marketplace and many other health plans must cover a set of preventive services such as shots and screening tests at no cost to you—meaning you won't have to pay a copayment or coinsurance. This is true even if you haven’t met your annual deductible. Preventive services include (but are not limited to):
- Alcohol misuse screening and counseling
- Blood pressure screening
- Cholesterol screening
- Colorectal cancer screening
- Depression screening
- Diabetes (Type 2) screening
- Diet counseling
- HIV screening
- Immunization vaccines
- Obesity screening
To find additional information regarding the Health Insurance Marketplace and extra savings, as well as state-specific information and how to apply in your state:
- Visit www.healthcare.gov
- Call 1-800-318-2596
- Follow twitter.com/HealthCareGov
- Contact your current health insurance company