The Affordable Care Act, often misnamed Obamacare, is one of the most confusing regulatory mandates in modern U.S. history. But it needn’t be. To the Affordable Care Act’s credit, it has reduced the uninsured population to unheard of lows, but if you are among the over 15 percent of Americans who purchase health insurance directly, instead of getting it through an employer, Medicare or Medicaid, here’s a few wildly insane tips you need to know. Remember, you can sign up for health insurance through the marketplace, (www.healthntx.com for more information) only during an annual open enrollment period. If you have a “qualifying life event,” such as getting married or having a baby, you can enroll outside of open enrollment for a special window of eligibility.
The annual open enrollment period is here and if you buy health insurance at work, your employer will inform you about its open enrollment period. The information below is for people buying health insurance on their own. You have several options for purchasing a policy:
- From your state’s health insurance marketplace
- Directly from a health insurance company
- From websites like www.healthntx.com that offers ACA health insurance quotes from multiple carriers
- From a health insurance agent
Here’s what you need to know for the open enrollment period for 2016 individual and family health insurance plans.
- The open enrollment deadlines have changed
You must purchase or change plans within the annual Open Enrollment period. This year, Open Enrollment for 2016 started Nov. 1, 2015 and ends on Jan. 31, 2016. Miss this window, and there won’t be any way to get insurance, or to change to a different plan, for the rest of 2016. If you sign up or switch plans by Dec. 15, your new coverage will start Jan. 1, 2016. (There are a few exceptions to this rule: If you lose other coverage during the year, for example by losing a job, getting divorced, or moving to another state, you’re entitled to a Special Enrollment Period to get new coverage at any time.)
People who qualify for Medicaid or the Children’s Health Insurance Program (CHIP) can enroll at any time of the year. These are state-federal programs for people with limited incomes or disabilities. This will be the last year open enrollment extends into January. Starting for 2017 health plans and beyond, open enrollment will be from Oct. 15 to Dec. 7, the same dates as Medicare open enrollment. Any coverage you elect during marketplace open enrollment then will start Jan. 1.
- You must sign up if you don’t have health insurance from another source. You need to sign up for health insurance during open enrollment if:
*You don’t have health insurance through your employer or your spouse’s employer.
*You don’t have government coverage (such as veterans, Medicare and Medicaid)
*You’re over age 26 and can no longer be on a parent’s health insurance.
*You qualify for tax credits to help you pay for health insurance coverage. - You may be entitled to more financial help than you thought
Depending on your income, you might qualify not only to receive a government subsidy for your insurance premium, but also for help with out-of-pocket costs like deductibles and copays. For instance, a two-person household can get a tax credit to offset part of the premium if their annual income is below $63,720. An income below $39,825 entitles them to buy special plans with reduced out-of-pocket costs. In most cases, the ACA uses the “adjusted gross income” line on your latest tax return, which in some cases could be considerably less than your total income. Healthare.gov has an easy-to-use calculator to assess what types of subsidies and discounts you’re likely eligible for.
- This is the time to make changes to your current plan
What you can do during open enrollment:
* You can renew your current individual/family health insurance plan.
* You can choose a new health insurance plan through the marketplace in your state or through private insurance.If you signed up for health insurance during open enrollment in 2015, your plan will automatically renew. However, the plan may make changes to its provider network, copays, co-insurance and drug coverage. Your plan must send you a notice of any changes it will make for 2016. In some cases, you can use out-of-network doctors and hospitals if you’re willing to pay more. In some cases, you might not be covered at all if you go out of network. Your prescription drug coverage also could change. The plan may no longer cover the drugs you take to manage your chronic conditions. It’s important that you check your plan’s drug benefits for 2016 before you allow it to renew. You may need to find a different plan for your needs and now’s the time to do it. Health plans must provide an online link to the list of drugs they will cover, known as formularies.
- The cost of your plan could change—a lot—from year to year.
Health insurance premiums reset every year, based on the insurance companies’ projections of how much they need to collect to cover their members’ health care costs. And in 2016, as in previous years, changes areall over the map — up significantly for some plans in some localities, down in others. If you already have insurance and don’t do anything, your plan will automatically renew for 2016. To avoid an unwelcome surprise when your first 2016 premium comes due, it’s a good idea to price out your options during Open Enrollment, which will show you whether your current plan is still the best value for you. This is especially true if you receive a tax credit to help with premiums. Because of the way the credit is calculated, it can potentially make the price swing even more severe in certain circumstances.
- Penalties for not having health insurance have increased for 2016
If you go without health insurance in 2016, the penalty is 2.5 percent of your income or $695 per adult (whichever is more) and the penalty for each child in the family without coverage will be up to $347.50. (In 2015, it was the greater of $325 or 2 percent of your income.)
If you owe a penalty, it will be taken from your tax refund. Unlike nonpayment of child support or other activities, the federal law prohibits the government from garnishing your wages or filing liens to collect an insurance penalty.
- Penalties for not having health insurance have increased for 2016Health plans that don’t count as “coverage”You will still pay a penalty for being uninsured if you have only these types of plans:
* Coverage only for vision care or dental care.
* Workers compensation.
* Insurance that covers only a specific disease or condition, such as cancer insurance.
* Plans that offer only discounts on medical services.If you go without health insurance in 2016, the penalty is 2.5 percent of your income or $695 per adult (whichever is more) and the penalty for each child in the family without coverage will be up to $347.50. (In 2015, it was the greater of $325 or 2 percent of your income.)
If you owe a penalty, it will be taken from your tax refund. Unlike nonpayment of child support or other activities, the federal law prohibits the government from garnishing your wages or filing liens to collect an insurance penalty.
- All health plans must cover 10 essential benefits
All health plans, no matter the level, must provide some coverage for at least 10 essential benefits. They are:
* Outpatient care including chronic disease management
* Emergency care
* Hospitalization
* Pregnancy and newborn care
* Mental health and substance abuse services
* Prescription drugs
* Rehabilitation services and devices
* Lab tests
* Preventive and wellness services
* Dental and vision care for childrenThe level of coverage for these services can vary. All the plans in the marketplace must provide consumers with a brief, understandable description of what they cover and how their plan works. The Summary of Benefits and Coverage (SBC) must be posted on the plan’s website. Check out the SBCs for the different plans you are considering. This is a good way to compare plans and benefits,
- Your family size and income determines your eligibility for tax credits
You may qualify for a premium tax credit which is based on income and family size. To qualify, your family income must fall between 100 and 400 percent of the federal poverty level (FPL).
That means, for example, a family of four with an income between $24,250 and $97,000 in coverage year 2016 would qualify for these credits. (The government uses FPL standards from the previous year to determine eligibility.)
If you qualify, the credits can be applied to your monthly insurance premiums. If your income changes during the year and you no longer qualify for the credits when you file your taxes, you will have to repay.
- If you suffered a hardship, you may not be required to buy health insurance
You may not be required to buy health insurance during open enrollment if you qualify for a hardship exemption. These include:
- Being uninsured for less than three months of the year.
- You are the victim of domestic violence or suffered from a natural or human-caused disaster such as a fire or flood that damaged your property substantially.
- A close family member recently died or you had unexpected expenses related to caring for an elderly, ill or disabled family member.
- You have been evicted from your home or suffered bankruptcy.
- You found you are ineligible for Medicaid because your state did not expand eligibility under Obamacare.
- You are not in the U.S. legally.
- You are incarcerated — either detained or in jail.
You also are exempt if you are a member of a recognized religious sect that has religious objections to insurance. Finally, you aren’t required to have health insurance if you live abroad for more than 330 days out of the year.
You can always contact the Robert King Insurance Agency for more information about this year’s open enrollment for Health Insurance! www.HealthNTX.com or give us a call at (214) 618-8080.
