With all the changes to the health insurance market over the last year, many people are looking to have the Affordable Care Act explained to them in a simple, straightforward way. We know you have lots of questions and we’re here to help with plenty of answers. The best way to start getting a handle on the Affordable Care Act, or ACA, is to review its major provisions.
This ensures that you cannot be denied coverage if you have a pre-existing condition. Hence, a guarantee of coverage.
Insurance Plan Pricing
This provision is designed to eliminate inequities in pricing. Under the ACA – a.k.a. Obamacare – you can’t be charged a different rate than someone else is charged because of your current health. Men and women must also be charged the same for the same plans. The only rating factors that can be used to determine price are geographic location, age and use of tobacco.
Federal Premium Subsidies
In order to have the Affordable Care Act explained properly, the discussion must include information about government subsidies for premiums. These subsidies – known as “advanced premium tax credits”- make premiums more affordable. They are available to qualifying individuals and families. Who qualifies? Those whose household income is less than 400% of the federal poverty level. That translates to $46,000 for an individual, $62,000 for a couple and $95,000 for a family of four. The subsidy is highest for lowest income households.
Annual/Lifetime Coverage Caps
Health plans no longer have an annual or lifetime cap on the amount of medical expenses they cover.
Health plans now cover certain kinds of preventative care completely, so the consumer doesn’t have copays, co-insurance or deductibles to worry about. The services that fall into this category include annual physicals and well as breast, colon and prostate cancer screenings.
To encourage all Americans to enroll in a health plan, the ACA created a tax penalty for those that remain uninsured. For 2014 that penalty was 1% of an insured person’s annual income, but it will increase each year, to 2% in 2015 and 2.5% in 2016, with increases tied to inflation after that.
Health Plan Tiers
The ACA has four main categories of health plans to differentiate them: Bronze, Silver, Gold and Platinum. Plans in each category pay a different percentage of the total cost of an average person’s medical care. The percentage covered takes into account the plans’ monthly premiums, deductibles, copayments, coinsurance and out of pocket maximums. On average, in the Bronze category your health plan pays 60% of the costs (and you pay 40%). Silver pays 70%, Gold pays 80% and Platinum pays 90%.
The ACA provides incentives for states to expand their Medicaid eligibility to include households with incomes up to 133% of the federal poverty level and many states, though not all, have chosen to expand.
By now, hopefully, you feel you have had the Affordable Care Act explained thoroughly. If you have other questions, we are here to help answer them. At HealthMarkets Insurance Agency, we simplify health insurance shopping. With access to more than 200 different insurance companies who provide thousands of health plans nationwide, HealthMarkets can help find the right plan for your needs with the full subsidy you qualify for.
Call us 24/7 at (800) 304-3414 or meet with one of our 3,000 local, licensed health insurance agents.