Health Insurance

In 2010 the Affordable Care Act, nicknamed “Obamacare,” passed into law and was signed. In 2-14 it went into full effect. Whether individual or group plans It allows you to get 3-4 levels of health insurance coverage from multiple companies. In the individual marketplace it also gives federal tax credit subsidies to pay at least part of your premium. These subsidies are based on the policy chosen, your “Adjusted Gross Income (Line 11 IRS 1040),”your zip code, the number of people on your federal income tax return, your tobacco use status.

This subsidy is NOT a discount. It is actual cash the federal government sends to the on marketplace insurance company and plan of your choice. You pay whatthe government does not pay. When you file your IRS1040 for the year if you predicted an Adjusted Gross Income” lower than you report then you will have to repay the IRS at least part of your subsidy. If you report a lower “Adjusted Gross Income” than you predicted you may get a credit.

Individual plans, prices and subsidies may change in each zip code but you can choose from Bronze, Silver, Gold and Platinum plans. Many zip codes do not offer Platinum plans in the individual marketplace. All plans start of the 1^st of the month you choose and all are calendar year plans.

Bronze are the least expensive with the highest deductibles, and depending on zip code Gold plans or Silver plans swop the #2 position on deductibles and pricing, then Platinum, if available.

Silver plans in some zip codes are the most expensive however in your income is low enough they not only give you a lower premium but lower deductibles, co-insurance and lower out of pocket maximums.

If you lose your company coverage you may br granted a “Special Enrollment Period.” Annually the “Open Enrollment Period (OEP)” is from 11/1 annually to 12/15 for a January 1 start date. The open enrollment is open also until 1/15 for a 2/1 start date.

Employers can offer a group plan to their employees. With group plans the government does not give tax credit subsidies and employers are usually held responsible for covering at least 50% of the cost of a group plan. Many group plans will only agree to a group also if it is at least 3 individuals or families.

Terms to Understand:

“Annual Deductible”

Everything medical has a price and a code. I use the example that a band aid on the toe may be a different code than one on the forehead. Everything has a price and you pay the price until you get to the deductible. In 2024 deductibles can run from $0 to $9450 maximum legally, as they are set by the federal Department of Health and Human Services.

“In Network” & “Out of Network”

Sometimes there is a lower price for being “In Network,” being with a doctor or medical facility that has a contract with the insurance company versus being “Out of Network,” at a facility with no contract with your insurance company. Each plan published both “In Network” and “Out of Network” pricing.

“Co-Insurance”

“Co-Insurance” is the percentage of what you pay and the insurance company pays for a medical treatment. Co-Insurance” percentages run from 100%/0%, to 90%/10%, 80%/20%, 70%/30%, 60%/40%, or 50%/50%. The first percentage is is what the insurance company pays and the second what you pay and the second.

“Annual Out of Pocket Maximum (OOP)”

After you have made it to your deductible then the co-insurance payment system kicks in until you get to the “Out of Pocket Maximum (OOP).” The OOP means you can pay no more then the set OOP in one calendar year. The legal limit for 2024 “Out of Pocket Maximum” is $9450 for one calendar year (for individual plans) or contract year (for group plans) as set by the federal Department of Health and Human Services. Each plan does not have to have the legal OOP and the lower deductible plans usually have a lower OOP.

“Co-Payments”

Many plans will have a flat fee called a ”Co-Payment” which is a set amount on money to go for a physician visit or a medical procedure which is outside the ”Co-Insurance.” Most “Co-Payments” go to reduce your annual deductible, and out of pocket maximum.