Open enrollment is here again, and for many Americans this time period – and the entire health insurance market – spells confusion.
Is Obamacare still in effect? Are premiums really increasing as much as predicted? Do I need to take action now if I’m happy with my insurance plan? What’s the difference between all the plans offered in the marketplace?
So many questions! No worries, though. We’ve got answers. Read on for the complete rundown on open enrollment, the Affordable Care Act (ACA) and today’s health insurance options.
1.) The ACA – still in effect?
Before you go shopping for a cheaper or better insurance plan, bear in mind that the Affordable Healthcare Act is still up and running. Many people are under the mistaken impression that the current administration has overturned the program or will soon do so. While an alternative health care plan has been proposed, there has been no change in the current system thus far, and it is not likely that there will be within the next few months.
What does this mean for the average American?
The ACA has made it mandatory for every American to have sufficient health care coverage. The penalty for failing to comply with this law is the higher of $695 per adult or 2.5% of household income.
The ACA also oversees the government-run health insurance marketplace in which insurance plans can only be purchased during open enrollment. In most states, the open enrollment period for 2017 is about 6 weeks long, running from Nov. 1 to Dec. 15. The following states have extended their enrollment period: California, Connecticut, the District of Columbia, Massachusetts, Minnesota, New York, Rhode Island and Washington.
2.) Rising premiums or cheaper rates?
If you ask the average Jane or John Doe if insurance costs are rising or falling, you’d probably get an earful about ever-climbing premium rates and health care costs. On the flip side, though, is the government, claiming their subsidized plan and the expansion of Medicaid has health care costs steadily declining.
In fact, both arguments are true. The silver plans on the ACA marketplace rose by an average of more than 30% this past year – and 2018 is looking a whole lot worse. Premiums are expected to rise by as much as 34-50% this coming year.
The current administration has claimed it will stop paying for many of the key payments to insurers it’s previously shouldered as part of the ACA. This factor, coupled with the overwhelming uncertainty surrounding the ACA, has led insurers to drastically increase their premiums.
The 80% of customers who receive subsidized insurance through Obamacare will be shielded from these price hikes; it’s the other 20% who will bear the brunt of the unstable marketplace.
The premium increase rates will vary by state and by the individual, but it is quite possible for an Obamacare customer who was paying $593 a month in premiums in 2017 to be saddled with a monthly premium of $1,001 in 2018!
All this uncertainty has led to another significant development: Many providers have left the marketplace plans. This means your doctor may no longer be part of your insurance plan. Be sure to find out about any possible changes before open enrollment is up, even if you aren’t looking to change your plan.
3.) Where to apply
If you do not receive insurance coverage through Medicaid, Medicare or your workplace, you may want to consider changing your insurance plan this year. To find out what your options are, visit healthcare.gov. Most states offer insurance coverage through this site, while others will redirect you to a private state-run site where you can purchase a marketplace plan.
4.) Available marketplace plans
Here’s a quick synopsis of each category of plans available in the ACA marketplace:
- Bronze: lowest monthly premiums, highest out-of-pocket costs and very high deductibles.
- Silver: the most popular plans available, silver offers moderate premiums and out-of-pocket costs, with lower deductibles than bronze plans.
- Gold: high monthly premiums but lower out-of-pocket costs and deductibles.
- Platinum: the most expensive plans in the marketplace, platinum plans have the highest monthly premiums but the lowest out-of-pocket costs and very low deductibles.
There is also a catastrophic plan available for individuals under age 30 and people who have received an exemption from the marketplace due to extenuating circumstances. These plans include free preventive care, low monthly premiums and very high deductibles.
5.) Choosing your plan
When shopping for a marketplace plan, it’s important not to base your decision on price alone. Many of the cheaper plans come with a heavy price. Your primary care provider or your child’s pediatrician may not be covered under some of the less expensive plans. You may need to pay out-of-pocket for many or all prescription drugs. Lastly, a higher deductible can mean that you’ll end up paying for all of your health care needs in 2018 without “cashing in” on your premiums before the year is over.
Be sure to shop around for a plan and do lots of research before making your decision.
Be an educated consumer this open enrollment season so that you make the best decision possible. Your health is too important for anything less!
Your Turn: The nationwide health insurance challenge has been hotly contested for years. If you had the power and means, how would you change the current system? Share your thoughts with us in the comments!