Health insurance is a vital way to protect you and your family. Employer-sponsored health insurance remains the most common how Americans get coverage, but Medicare and Medicaid also cover millions of Americans. Also, individual health insurance and the Affordable Care Act exchanges are a way to get coverage.
Here are answers to some of today’s most common questions about shopping for health insurance.
Am I still required to have health insurance?
Congress ended the individual mandate penalty that required nearly all Americans to have health insurance. This means the federal government won’t fine you for not having insurance at tax time. That said, a handful of states have their own mandates that require health insurance. So, if you live in California, the District of Columbia, Massachusetts, New Jersey, Rhode Island or Vermont, you’ll need health insurance in 2020 or face a penalty.
Is my employer required to offer me health insurance?
Companies with 50 or more employees are required to offer 95% of their full-time workers (those who work more than 30 hours a week) health insurance that is of minimum value and affordable.
Minimum value means that the plan pays at least 60% of covered services. Affordable means that the employees’ share of the premiums costs them less than 9.5% of their annual salary.
When compared with plans you purchase on your own, job-based coverage is almost always the better deal because your employer is likely to pay a large portion of your monthly premiums. That said, people with an income that’s less than 400% of the federal poverty limit are eligible for subsidized Affordable Care Act plans.
Health insurance obtained through your workplace will have its own open enrollment. Your employer should inform you about its open enrollment period.
Where can I buy health insurance?
If you don’t have coverage through your work, you can buy coverage via the government-run marketplaces called exchanges. Some states run their own exchanges while others rely on the federal government. If your state doesn’t have its own marketplace, you shop for health insurance through Healthcare.gov.
However, you’re not required to buy your health insurance on the marketplace. You can buy an individual or family health insurance plan directly from an insurance broker or company. (To compare prices on various plans, fill out the form near the top of this page to get quotes from leading carriers.)
However, if you’re eligible for government subsidies to help pay your monthly premiums and you wish to use them, you must buy through the government-run marketplace. You may be eligible for these subsidies or tax credits if your income is low to moderate and you don’t qualify for Medicaid.
Also, Medicare, Medicaid and COBRA could be options for people depending on your situation.
Can I buy health insurance at any time?
You can enroll in health insurance plans only during open enrollment periods. Companies have different open enrollment periods, so check with your employer about specific dates.
Open enrollment for individual health plans and the ACA exchanges for 2019 runs from Nov. 1, 2019 to Dec. 15, 2019 for most states for coverage that starts on Jan. 1, 2020. Some states are extending the time that people have to buy individual health insurance.
States with longer open enrollment periods include:
- California – Oct. 15, 2019 to Jan. 15, 2020
- Colorado – Nov. 1, 2019 to Jan. 15, 2020
- D.C. – Nov. 1 , 2019 to Jan. 31, 2020
- Massachusetts – Nov. 1, 2019 to Jan. 23, 2020
- Minnesota – Nov. 1, 2019 to Dec. 23, 2019
- New York – Nov. 1, 2019 to Jan. 31, 2020
- Rhode Island – Nov. 1, 2019 to Dec. 23, 2019
If you buy after the Dec. 15 date in the states that are extending the enrollment period, you’ll need to check to see when the coverage will start. Most states still require you to obtain your plan by Dec. 15 for it to start on Jan. 1, 2020. If you buy after Dec. 15, your plan’s start date may be Feb. 1 or March 1, 2020.
If you miss out on open enrollment, you may qualify for a special enrollment period and enroll in a health insurance plan at any time if you or someone in your immediate family:
- Gets married
- Has a baby
- Loses coverage through death, divorce or unemployment
- Moves outside your health plan’s coverage area
- Becomes a U.S. citizen
- Is released from jail
- Has a change in income that affects eligibility for premium subsidies
What are types of health plans?
The three most common types of health plans are:
- Preferred provider organization (PPO)
- High-deductible health plan (HDHP)
- Health maintenance organization (HMO)
The most common type of health insurance plan is a PPO. More than half of employer-sponsored health plans are PPOs. PPOs are known for higher premiums with more member flexibility. Notably, PPOs don’t require members to get referrals from primary care providers to get care from specialists. PPOs also let you receive out-of-network care, though it’s more expensive than in-network providers.
HDHPs are the second largest health plans. About one-third of employer-sponsored health plans are HDHPs. What sets these plans apart are their high deductibles and out-of-pocket costs — and lower premiums. These plans also usually have a Health Savings Account or Health Reimbursement Arrangement that allows members to save money tax-free for their health care costs. Often, employers contribute to those accounts to help employees pay for care.
A third common type of health plan is HMO. HMOs have lower premiums than PPOs, but limit member flexibility. Members must get a primary care provider referral to see a specialist. These plans might also forbid you to get any care out-of-network. HMOs make up more than half of the individual insurance market.
What kind of individual health insurance is best for me?
If you’re shopping for an ACA exchanges plan, there are five metal categories:
The categories have nothing to do with the quality or amount of care you receive. Instead, they determine how much you pay out of pocket for the services you use.
If you visit the doctor regularly and take prescription drugs, you probably want a gold or platinum plan because they pay 80 to 90% of the cost of services and you pay 10 to 20% out of pocket.
If you are healthy and don’t take prescription drugs, you can pay less in premiums with a silver or bronze plan. However, if you become ill, you will pay a greater share of your medical bills.
There are also catastrophic or short-term plans available. These plans are low-cost, but also have limited benefits. You’re able to stay on a short-term plan for a year and can renew twice. In effect, you can keep a short-term plan for three years.
For more information on different types of plans, see the Insure.com article on health insurance basics.
How do I choose a health plan?
Choosing a health insurance plan depends on preferences and your health care situation.
It’s a wise idea to make sure you understand what each plan covers, including prescription drugs. Also, check that your health care providers are part of a plan’s network before signing up.
You’ll also want to crunch the numbers to make sure you find the best economical plan for you. Check out the premiums and estimate how much you expect to pay out of pocket over the past year. You can do that by looking back at the past year’s health care needs and what you’re expected for the coming year. For instance, if you plan to start a new family, you’ll likely have higher health care needs than the previous year.
If you don’t plan on need many health care services, an HDHP can be a wise choice. However, understand that those plans mean higher out-of-pocket costs if you need health care services. So, you benefit from lower premiums, but pay more when you go to the doctor’s.
Health insurance is one of the most important purchases you make each year. Make sure you’re comfortable with your plan before signing up.