Affordable Care Act (ACA) Health Plans
What is the Open Enrollment Period (OEP)
Open enrollment is the only time of year you can apply for cost assistance, switch plans, or enroll in a major medical plan that counts as minimum essential coverage in the individual and family market without qualifying for a special enrollment period. This is true both inside and outside the health insurance marketplace. Other health insurance types like employer coverage, Medicare, Medicaid, and CHIP have unique enrollment periods, which can be found below.
What is a Special Enrollment Period (SEP)
A special enrollment period is a time outside of open enrollment when you and your family can sign up for health insurance in the health insurance marketplace.
You may qualify for a special enrollment period of (typically) 60 days following certain life events that involve a change in family status (for example, marriage or birth of a child) or loss of other health coverage.
- Job-based plans must allow special enrollment periods of 30 days (giving you no less than 30 days to switch to an employer plan from a non-employer plan). If you lose your job you get 60 days to enroll in marketplace coverage.
- Many special enrollment periods start before you lose coverage, thus giving you time to enroll in a plan and avoid a coverage gap.
- IMPORTANT: Even though an enrollment period starts 60 days following the day of the event, in most cases you can enroll up to 60 days before the event. This allows your coverage to start on the day of the event and allows people to avoid any gaps in coverage.
- If you don’t have a special enrollment period, you can’t buy insurance inside or outside the Marketplace until the next open enrollment period.
Make Sure You Understand Your Health Insurance Plan
When shopping for a health insurance plan it’s important to understand more than what basic “metal plans” are available. To properly compare plans you’ll have to understand your estimated income, medical needs and costs for next year, the docs you’ll need and drugs you take, and what you can pay in an emergency. You’ll also need to understand things like deductibles, premiums, insurer networks, drug formularies, HMOs, PPOs, HSAs, and other technical health insurance terms that affect what type of coverage you get and how it works.
These Qualified Health Plans represent four tiers of coverage and are sometimes referred to as “metal plans” due to their quality corresponding to the value of their metal types. In other words a “Gold” plan is better than a “Bronze” health insurance plan. Aside from the 4 basic plan types, people under 30 and people with hardship exemptions can buy a catastrophic health plan through the marketplace. Catastrophic health plans have a low premium but very high out-of-pocket costs.
Bronze Plans split covered services 60/40 on average
Bronze plans are the cheapest plans. All employer plans and non-catastrophic marketplace plans must provide at least the value of a bronze plan.
For a Bronze plan with 60% actuarial the insurer will, on average, pay 60 % of covered health expenses while the policy holder must come up with the other 40%. In other words a plan with 60% actuarial value covers 60% of out-of-pocket costs on average for all policy holders, not just you.
Bronze plans have the most basic benefits and most limited networks of doctors and hospitals. The actuarial value reflects this since that percentage is determined by the average expenses your insurer will have.
A Bronze plan is a good choice for those who don’t plan on using many medical services. Many low-income Americans may qualify for free or very low-cost Bronze plans. That being said in many cases a Silver plan will provide better value as Bronze plans won’t qualify for Cost Sharing Reduction Subsidies. You will be getting a low premium in exchange for the fact that you will pay more out-of-pocket and have a more narrow network
Silver Plans split covered services 70/30 on average
Silver plans are “the marketplace standard” meaning that premium caps are based on the cost of Silver plans. A Silver plan on the marketplace can’t cost more than 9.5% of your income if you make less than 400% of the Federal Poverty Level (FPL) due to Advanced Premium Tax Credits. The less you make, the lower your premium cap is.
Like Bronze Plans, the actual value of Silver plans can range. They simply must have at least a 70% actuarial value.
Silver plans are the only plans eligible for Cost Sharing Reduction Subsidies (CSR)
A Silver level plan is a good choice for individuals and families who have access to marketplace subsidies, especially CSR subsidies. If you make below 250% FPL the chances you won’t find your best plan to be a marketplace Silver plan is slim. Go with an HMO when in doubt, you’ll need referrals, but this will be your cheapest option. Like with any other plan, make sure your medical needs are covered in-network.
Gold plans split covered expenses 80/20 on average
Gold plans cost a little more, but the lower deductibles and better out-of-pocket cost sharing coverage means that families won’t have to worry about health care costs stopping them from their families getting the care they need. Even if your premium is capped you’ll have to pay more to make up the difference if you want a gold plan.
Gold plans are smart for those who don’t get CSR subsidies and need the low deductible and robust networks some gold plans provide.
Platinum plans split covered expenses 90/10 on average
Platinum plans have the lowest out-of-pocket costs and the highest monthly premiums. This is the right choice for anyone who wants “the best coverage” for them and their family and is a smart buy for those who are sick or who have dependents who are likely to use costly health services. Even if your premium is capped you’ll have to pay more to make up the difference if you want a Platinum plan.
Platinum plans only make sense if your total medical spending will exceed the amount you will pay in premiums or if you need very specific treatments.
Catastrophic coverage is available to some people under 30 and those with hardship exemptions. Catastrophic plans only cover the bare minimum health benefits and has a very limited network. You’ll have high out-of-pocket costs and a high deductible but this type of plan will protect you in a worst case scenario and will ensure that you avoid paying the shared responsibly fee for not having health coverage. If you get a catastrophic plan you should assume most of your medical costs will be out-of-pocket.
NOTE: You can also get covered through Medicaid on the marketplace. As a rule of thumb if you make less than 250% FPL a Silver plan is the way to go, if you make less than 138% and your state expanded Medicaid then you’ll go with Medicaid.