It’s easy to understand why you might want to re-enroll in the same Affordable Care Act (ACA) plan you have. Or, if it’s your first time enrolling, you may be tempted to ask a friend what they use and just sign up for that. Who has the time or desire to wade through all the options?
Yet experts say it’s wise to weigh all your options, especially if you want to save money. After all, there may be a new insurance company or plan in your area that better suits your needs. Or, the plan you’re currently enrolled in may no longer be available, which means you could automatically get renewed into a “similar” plan that doesn’t meet your needs, says Katie Keith, JD, MPH. Keith is an associate research professor at Georgetown University’s Center on Health Insurance Reforms in Washington D.C.
What’s more, under the American Rescue Plan Act of 2021 (ARPA), new marketplace subsidies mean many individuals could qualify for more generous premium tax credits. (Subsidies are monthly credits based on your income that reduce a plan’s premium costs.) “This could allow you to maximize your savings and potentially enroll in a more generous plan,” says Keith.
You can start comparing plans now with HealthMarkets.
Just how much could you save by shopping around? Keith points to a 2021 report from the U.S. Department of Health and Human Services. The report found that after the ARPA, existing consumers saved an average of $67 (or 50%) per month on premiums.
So, what should you do before your ACA enrollment to make the most of your options? Follow these five tips:
1. Assess your salary for the coming year.
Premium tax credits, or subsidies, are based on your adjusted gross income for the coming year. Assessing your income will help you figure out the amount of subsidies you qualify for and what plans best meet your budget and needs. (You can use a subsidy calculator such as this one to estimate whether you might qualify for a premium credit.)
Estimating your salary can also help prevent you from overpaying for your insurance, too, says Tasha Riggs, sales leader for HealthMarkets in Westminster, Colorado. For example, Riggs says she’s seen significant reductions to premiums as a result of the ARPA, and thanks to those market subsidies, individuals who previously had incomes that excluded them may qualify for credits and save on their premiums.
If you end up making less than you guess, you’ll get back the difference you’re owed on your tax refund. But remember, the flip side is true too: If you make more money in the coming year than you estimated, you may have to pay back some of the subsidy come tax time. Keith acknowledges that it can be challenging to estimate, especially for shift or hourly workers. To help make an estimation, she recommends starting with your prior year’s income and adjusting that based on any income changes you expect for the year.
Need help assessing plans and options? Speak with a licensed insurance agent at (800) 304-3414. They can help you find a plan that meets your specific needs.
2. Call doctors and check provider directories.
Insurance companies offer provider directories that make it easier to find in-network doctors, so be sure you check your current or new plan’s directory, especially if you’re keen on keeping a particular doctor. You can also call doctors’ offices to see if they’re still accepting a specific plan, but note this caveat from Keith: “I’ve heard anecdotes where a doctor’s office says it takes coverage from the insurer, but it turns out they’re not in network.” Bottom line? Confirm that your providers accept the plan and are in network before purchasing it. There can be a difference in cost.
3. Check for new ACA plans in your area.
Plans and prices change every year, and more insurance companies are offering coverage this year, Keith says. That means you have more options than you did in previous years, so you should take time to review them to shop for a plan.
4. Utilize all of the subsidies available to you.
Affordable Care Act enrollees who make below certain income limits may qualify for “extra savings,” known as cost-sharing reductions. These extra benefits lower your out-of-pocket costs (such as deductibles, out-of-pocket spending limits, and copays), but they can be used only with a silver plan, Riggs says. The catch? Silver plans might have higher monthly premiums than other options (such as bronze-tier coverage). But you’ll usually pay less out of pocket when you use your silver coverage.