The most frequently asked health insurance question-The hardest to answer
Under the Affordable Care Act (Obamacare) all US residents are obliged to have health insurance for themselves and their dependents. The act specifies the minimum services to be covered. If we consider national average health insurance cost, the amount per person is $207 ($477 before subsidy) . This is based on your state’s benchmark plan*.
The questions to be answered are:
1. HOW MUCH SHOULD I EXPECT TO PAY FOR BENCH-MARK HEALTH INSURANCE COVERAGE FOR MY DEPENDENTS AND ME?
2. CAN I GET THE SAME COVERAGE FOR LESS?
3. WHAT CAN I GAIN BY PAYING A LITTLE MORE?
SEEMS SIMPLE but there are complications
Individual States have the right to insist on additional services (Expanded ACA). Every citizen can choose, within limits, how to share medical costs with their chosen insurer.
There are four basic questions which determine the cost of your health insurance:
1. Your age – As you might expect older people are likely to be more frequent users of medical services
2. Your Location – Yours may be one of the States which provides services above the ACA minimum or you may live in an area distant from an ER or Urgent Care Clinic
3. Family status – Are you shopping for an individual or family plan?
4. Tobacco usage – Are you or any of your dependents, tobacco users?
Note: – Pre-existing conditions whether diagnosed or not do not affect your eligibility for coverage.
You may be entitled to
- State subsidies
- Premium tax relief
Over 80% of insured citizens benefit from one or more of these entitlements. They are what put ‘AFFORDABLE’ into the ACA.
*What is a benchmark plan?
The ACA requires health insurance exchanges to offer plans that deliver the 10 essential benefits defined in the act. There are four levels (Tiers) of these plans (Bronze, Silver, Gold, Platinum) which determine the way in which you and your insurers, will share the total cost of your healthcare. Your tax credits will be based on the premium costs of the second lowest price silver tier within your state health insurance exchange. Your tax credits will apply to whichever plan you choose.
SEEMS COMPLEX? IT IS! But, Federal, State, and Private Health Insurance Exchanges are there to help you navigate the maze.
Any of these Agencies will give you independent professional advice. Generally speaking, the Private Health Insurance Exchanges will have wider access to ‘A’ rated insurance companies and a more flexible and comprehensive approach to your total insurance needs.
Let’s look at the factors:
Age ‘21’ is established as a base rate and monthly premium costs are adjusted upwards according to age. So, for example, at age 30 the premium might increase by .0135, at 40 by .0278 and at 50 by 0.768.
These are actuarial (accepted standard) numbers.
Your premium will be directly influenced by your state regulations, and service provisions.
Just as with individual health insurance, the cost of health insurance for your family will depend on age, location, tobacco usage and plan category.
THE PLAN CATEGORY- What is it?
Plan categories are all about convenience, flexibility and choice.
There are four general definitions*
● Health maintenance organisation (HMO)
● Point of service (POS)
● Preferred provider organization (PPO)
● Exclusive provider organization (EPO) – Each gives a higher degree of choice and access health and medical care.
There is of course a cost!
You might expect POS to be some 6% more expensive than the standard HMO. Do you or any of your dependents travel abroad or outside your local network of providers? You can expect your premium to be up to 10% higher. An ACA Marketplace plan-FOR FREE! Make the most of your Premium tax relief
Let’s start with PREMIUM TAX RELIEF.
All health insurances require a monthly premium (just as with house or car insurance). The Affordable Care Act ensures that premiums paid attract TAX RELIEF. But I can’t afford health insurance so what good is tax relief to me??
The allowable tax relief is based on the benchmark determined by your state and your household income. If your income anywhere between $12,490 (single), $25,750(family of 4) and FOUR times these amounts, you are ENTITLED to tax relief on your premiums.
Your entitlement is a fixed amount, based on the cost of a ‘silver tier’ health insurance plan in your state and your household income. Calculate subsidy link here.
You may only apply this ‘premium tax relief’ to reduce your net health insurance premiums. BUT you can choose any ACA approved plan. It will not affect the amount of tax relief.
PUT SIMPLY, if you use your tax relief (based on a Silver-tier plan) to provide coverage for you and your dependents on a BRONZE plan you may find that you can have the security of ACA FREE of CHARGE. You can make a claim as part of your tax return or have the payment made direct to your insurer.
OPEN ENROLLMENT runs from 1st November to 15th December for 2020. Don’t miss the opportunity to secure FREE HEALTH INSURANCE. Talk to your Health insurance exchange. Do it now! Find out how you and your family can take full advantage of ACA.
Missed open enrollment? Learn what to do next!
You are not alone
There are probably 4 million US citizens who could apply for ‘bronze’ plans during this open enrollment for coverage in 2020 and pay nothing. DON’T MISS YOUR OPPORTUNITY. Health insurance exchanges offer secure advice on the best value for you and your dependents and the confidence that your interests come FIRST.