Each year, the Affordable Care Act—popularly known as Obamacare—creates a period when health insurance policyholders can buy or change their coverage through state exchanges or the government website. This year, many locations will feature fewer carriers bidding for your business, but virtually every county in America still has coverage options.
But pay attention: the government has dramatically reduced the open enrollment period this year; in most states it starts November 1 and ends December 15. This is very important because you cannot enroll outside of open enrollment unless you have a “qualifying event,” such as:
- Becoming a U.S. citizen,
- Birth or adoption,
- Involuntary loss of other health coverage
- Permanent move to an area where new health plans are available. This only applies in most cases if you already had coverage prior to your move.
Can’t you just continue with the coverage you have today? If you’re happy with your current policy, that’s one option, but prices are going up by an estimated average of 15% as many insurers are unsure whether they can count on government reimbursements. It doesn’t hurt to look and see if your current insurer is raising rates higher than the competition.
By now, you know that comparison shopping is not as difficult as it once was. The chief benefit of the ACA is the standardization. You can choose a bare bones bronze plan, a silver plan with lower deductibles and broader coverage, or a gold plan with more of both, and the various plans in each category, to qualify to be on an exchange, have to offer similar coverage features.
A second benefit is that, theoretically, the marketplaces create healthy competition among insurers, who bid for your business by lowering premiums below what they might have charged if the marketplace didn’t force them to match the competition feature-for-feature.
Of course, if you have a significant health issue come up recently, then shopping takes on a new urgency. You might consider switching from a bronze to a silver plan, or silver to gold. Or you might realize that you’re not utilizing the medical system as much as you expected, and drop down to a baser metal.
Roughly 85% of the 11 million people who buy through one of the exchanges qualify for tax credits that significant reduce out-of-pocket costs for deductibles and co-pays, and can also reduce premiums. The average monthly premium before tax credits for a silver plan is $433 for 2017, but that drops to as little as $75 with tax credits. However, many uninsured adults aren’t aware that they are eligible to receive this assistance. The tax credits are only available to those who enroll in a marketplace policy, and cost-sharing help is only available in the silver plans.
You can get help enrolling and comparing plans by phone or with a local in-person guide, called a navigator. ACA marketplace call centers are available 24 hours a day, every day except holidays. At HealthCare.gov, you can search by city and state or ZIP code to see a list of local organizations that can help you.
About the Author: Bob Veres has been a commentator, author and consultant in the financial services industry for more than 20 years. Over his 20-year career in the financial services world, Mr. Veres has worked as editor of Financial Planning magazine; as a contributing editor to the Journal of Financial Planning; as a columnist and editor-at-large of Dow Jones Investment Advisor magazine; and as editor of Morningstar’s advisor web site: MorningstarAdvisor.com.
Mr. Veres has been named one of the most influential people in the financial planning profession by Investment Advisor magazine and Financial Planning magazine, was granted the NAPFA Special Achievement Award by the National Association of Personal Financial Advisors, and most recently the Heart of Financial Planning Distinguished Service Award from the Denver-based Financial Planning Association.