Beginning on January 1, 2014, most of the provisions of the Patient Protection and Affordable Care Act (PPACA), also known as Obamacare will go into full effect. One of these provisions is the requirement that every American have health insurance or pay a fine. Therefore, it is very important to find health insurance that gives you the coverage you need at a price you can afford. But how do you do this? Despite the controversy about the overall cost of the Affordable Care Act, there are some new ways to find affordable health insurance on an individual level. Here are 4 ways that you can find health insurance that fits your budget and medical needs.
Reformed Group Insurance through an Employer
Obamacare has reformed the group insurance model. While originally set to be implemented in 2014, the employer mandate to provide health insurance has been postponed until 2015. Still, once it is put in place, you will be able to find health insurance through your employer that puts limits on what you pay for the plan and what your out of pocket limits will be.
The Affordable Care Act requires that employers with more than 50 full-time employees offer medical insurance to all of their full-time employees. Full-time is defined as anyone who works at least 30 hours per week. There are different calculations that go into the full-time definition, but just know that if you average 30 hours per week, you must be offered coverage.
The coverage that you are offered must have at least a 60% actuarial value, meaning that on average, for every dollar that the insurance covers, the insurance plan must pay for at least 60 cents. One of the ways this is achieved is by limiting the individual’s out of pocket maximum. In 2014, the limit is $6,350 and includes deductible, coinsurance, and copays.
Also, the employer cannot make an employee pay more than 9.5% of their salary to participate in the plan. If you make $2,000 per month, the most you can pay for your insurance is $190. Having said this, there is no cap on the cost of insurance for a dependent.
Still, with these provisions in place, you can find health insurance that is probably cheaper and better than before.
Health Insurance Marketplaces
Obamacare created health insurance marketplaces – originally called exchanges – to help people find health insurance plans quickly and efficiently online. The marketplaces will make the search for a good plan easier than looking for individual insurance on your own. Everything will be in one place.
While it will be interesting to see if the actual premiums of the plan are any cheaper than pre-Obamacare, some people will get help paying their premiums by way of tax credits (see here for tax credit eligibility).
If someone can find health insurance and use a tax subsidy, a good plan at a low rate will be available.
The Affordable Care Act requires insurance companies to allow children to enroll in their parent’s insurance plan until age 26. This is very advantageous because many times the cost to add a dependent to a plan is lower than the cost of an individual plan. In fact, many times a new dependent can be added at no cost since some plans have one premium rate for all children on a plan. In that case, someone under age 26 can effectively find health insurance that is free.
When Obamacare was passed, it required Medicaid to be expanded in every state. This expansion will make it easier for adults to find health insurance through this government program. The Supreme Court took away the requirement, and as a result, many states will not be expanding this coverage.
However, if you live in a state that is expanding Medicaid, check to see if you are eligible for this low cost way to care for medical needs.
Find Health Insurance at an Affordable Rate
When you try to find health insurance at an affordable rate, make sure to be patient and look at all your options. Good coverage at a reasonable price is available.