In 2010, the Affordable Care Act (ACA, also known as Obamacare) was passed, revolutionizing how health care is provided in America. Its primary goal is to make affordable health insurance accessible for all Americans.
The Affordable Care Act (ACA) gives people access to subsidies in the marketplace that lower their monthly premiums and out-of-pocket expenses. Furthermore, it requires insurers to offer a full range of benefits.
Open Enrollment Period
Open enrollment is a time each year when you can enroll, re-enroll, or switch your health insurance plan. During this window of opportunity, you can find the plan that meets both your family’s needs and budget.
You can get information about your health coverage options and apply for Medicaid or the Children’s Health Insurance Program (CHIP). Both programs offer free or low-cost health insurance to eligible children and adults.
If you miss the open enrollment window, there are still other ways to secure coverage such as through a special enrollment period, Medicaid/CHIP coverage or short-term plans.
A special enrollment period is activated when you experience a qualifying life event, such as losing employer-sponsored coverage, getting married or having a baby. You are eligible for this type of break within 60 days from the date of the event.
The Marketplace provides certified enrollment assistants with flexible hours to assist you with finding health insurance plans. These individuals can answer questions, review program eligibility, explain financial assistance and cost estimates, and compare plans.
Special Enrollment Period
Although the annual open enrollment period is the ideal time to purchase a health insurance policy, there may be instances when people need to adjust their coverage outside that window. For instance, you could lose employer-sponsored coverage, age out of your parent’s plan, or move to another state.
Fortunately, special enrollment periods exist for these life events. These typically last 60 days from the date of the event and allow you to enroll in a plan.
Loss of Coverage
The most frequent qualifying event for loss of coverage is job loss, aging off an employer’s plan, divorce or legal separation. Furthermore, birth or adoption of a child meets this criteria as well.
Another qualifying event is a permanent change of residence, such as moving to a different home or ZIP code. However, HHS notes that temporary relocation for medical treatment does not trigger the special enrollment period.
Short-Term Plans
Short-term health insurance plans can cover your medical expenses while you wait for an affordable ACA plan during open enrollment. Unfortunately, they don’t provide as much coverage as ACA-compliant major medical plans do.
Contrary to ACA plans, they typically do not cover maternity or mental health services. Furthermore, they often do not cover prescription drugs or pre-existing conditions.
Additionally, many short-term plans have an annual or lifetime benefit cap. This poses a serious obstacle for individuals with serious medical requirements.
Some states, like California, New Jersey and Massachusetts have outlawed short-term health plans that don’t offer protections for people with preexisting conditions. Conversely, states such as Colorado and Connecticut have tighter regulations regarding their sale.
Short-term plans can be an attractive option for many people, especially those who need coverage in case of an unexpected major illness or injury. Furthermore, they provide an invaluable solution for those who have missed their annual open enrollment period or experienced a qualifying life event.
Subsidies
The Affordable Care Act (ACA) offers subsidies through the Marketplace to help reduce health insurance costs. There are two primary types of subsidies: premium tax credits and cost-sharing reductions.
The premium tax credit is the most popular subsidy offered on the exchange, reducing enrollees’ monthly payments for plans purchased through the exchange. These credits can be applied towards any Marketplace plan — bronze, silver and gold included — at no extra cost.
Subsidies are calculated based on income, and individuals with incomes (ACA-specific MAGI) up to 400% of the federal poverty level may qualify for these subsidies.
People with incomes up to 150% of the federal poverty level may qualify for more generous subsidies that cover the cost of a benchmark silver plan and reduce deductibles and copays to levels similar to platinum plans.
Before 2023, many individuals offered employer-sponsored health coverage could not qualify for subsidies because the affordability calculations failed to take into account their family size or income. With the IRS fixing this flaw in 2023, many more families now qualify for marketplace subsidies.
