How to Purchase Individual Health Insurance
The Affordable Care Act (ACA) created a marketplace that permits you to compare individual health insurance plans. The law also necessitates plans must offer certain coverage.
The ACA transformed the health insurance landscape. It also gives most U.S residents multiple individual insurance options.
Let’s focus on individual health insurance and the ACA marketplace.
Selecting Individual Health Insurance Plans 2020
When selecting a health plan, you need to assess your healthcare needs, review the choices, crunch the numbers, and pick the plan that makes the most sense for your finances and health.
You can be covered in the following ways:
- Group health insurance: Your employer chooses the plan(s) and health insurance companies. You enroll at work, typically in the fall, during your employer’s open enrollment period.
- Individual health insurance: This is a plan you purchase on your own. An individual plan can cover just one individual or family. You can buy directly from the best health insurance companies or your state’s health insurance marketplace, also known as an exchange.
- Medicaid and the Children’s Health Insurance Program (CHIP): These federal-state health insurance coverages have low-income requirements.
- Medicare: Mostly, for individuals age 65 and over.
- Short-term insurance: These low-cost, low-coverage plans are available to everybody. They’re not technically regarded health insurance because they usually don’t cover many services that are basic in health insurance plans. For example, they often don’t include mental health and maternity care.
Do Your Research Before Open Enrollment
You can purchase the best individual health insurance plans that meet government standards for coverage only during the annual open enrollment period unless you have a particular situation. For example, losing your job, getting married, or having a baby creates a special enrollment period. So, you can make changes to your health insurance at that time. Nevertheless, if you don’t have a qualifying life event, open enrollment is the only time you can make changes.
Research Health Plans on Your State Marketplace
The federal government’s HealthCare.gov website has links to state health insurance marketplaces. These plans provide subsidies to reduce your expenses if you meet income requirements.
If your income qualifies you for discounts or lower out-of-pocket costs, you can fill out the application to see if you are qualified for assistance and to compare health plans from private insurance companies in your location.
Health plans sold in the marketplaces are grouped according to how much the healthcare costs the insurer and how much the customer pays. Usually, the higher the out-of-pocket costs –the more you pay in deductibles, coinsurance and copayments — the lower the premium.
Types of Marketplace Health Insurance Plans
The health plan categories in the ACA marketplace include platinum, silver, gold, and bronze.
Bronze plans have the lowest premiums but the most out-of-pocket costs when you utilize health care service. Platinum has the highest premiums but the lowest out-of-pocket costs.
Bear in mind these are general categories. The projected out-of-pocket costs are averages. Plans in the same metal category might attain the cost split in different ways. Two Bronze plans, for example, might have different deductibles and coinsurance levels. Nevertheless, their overall out-of-pocket costs are about the same.
Health insurance plans in the same metal level might also be structured differently. One Bronze plan might be an HMO, and another might be a PPO. Depending on the kind of plan, you might have free access to any provider in your network, or you might need to get a referral from a primary care doctor.
More than half of individual health insurance plans are HMOs. PPOs, which are the most popular type of plan in the employer-sponsored market, only make up 16% of individual plans.
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