Health care questions? Health care answers.
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The premium tax credits that are available are actually a new kind of tax credit that can be applied immediately to lower the cost of your monthly premiums – you don’t have to wait until tax time to get them! Advance payments of the credit can be applied to lower premiums each month, up to a maximum amount.
For example, say a 28-year-old community college student who works part-time and makes $16,000 a year wants to buy a plan on the new Health Insurance Marketplace. Before tax credits, a mid-level Silver plan might cost her $230 a month (the actual price of plans will vary depending on where you live). However, based on her income, she could qualify for a premium tax credit of $185 per month. If she takes this tax credit up front, she would only have to pay $45 per month for a Silver plan on the marketplace. If she opted to buy a lower-level Bronze plan, her monthly premium would only be $6 a month.
If the amount of advance credit payments you use is less than the total you’re due at the end of the year, you can have the difference refunded on your taxes. If your advance payments at the end of the year are actually more than your credit (perhaps because you underestimated what your income for the year would be), then you would owe money on your taxes.
Find out more information about premium tax credits here: https://www.healthcare.gov/will-i-qualify-to-save-on-monthly-premiums/.
Insurers will offer plans on the new Health Insurance Marketplace at four levels of coverage: Bronze, Silver, Gold, and Platinum. Each plan level must cover the same “essential health benefits”: https://www.healthcare.gov/what-does-marketplace-health-insurance-cover. Lower tier Bronze and Silver plans will have lower monthly premiums, but higher levels of “cost sharing” – the amount you pay out-of-pocket in the form of deductibles, co-insurance, and co-pays. In other words, if you get a Bronze or Silver plan, you will have a cheaper monthly cost, but you will pay more for each doctor’s office visit or prescription medication. In contrast, higher tier Gold and Platinum plans will have higher monthly premiums, but lower levels of cost sharing: https://www.healthcare.gov/how-do-i-choose-marketplace-insurance.
You should compare all of the plans to determine which is best for your personal circumstances, like your health history and how often you think you will use health care services. However, all plans, regardless of tier, must offer preventive services at no additional cost to you. Here is a list of the free preventive services you can access with a Marketplace plan: https://www.healthcare.gov/what-are-my-preventive-care-benefits/.
You will use a single, streamlined application to apply for an insurance plan on the new federal Health Insurance Marketplace, see if you qualify for tax credits or subsidies to lower your health care costs, and find out if you’re eligible for free or low-cost coverage through Medicaid or the Children’s Health Insurance Program (CHIP). States that are operating their own state-based marketplaces will have their own, similar application that you will use to apply for tax credits/subsidies, Medicaid/CHIP, and enroll in plans sold in your state. To find out if your state is part of the federal marketplace or is running its own state marketplace and to access the application, go to HealthCare.gov.
On the application, you will be asked to provide information about you and the members of your household applying for coverage, including your income, employment information, and current health insurance policy (if any). HHS recommends having documentation like pay stubs and W-2 forms on hand. You will also need to provide your Social Security Number or immigration document number. Information from other sources, such as the IRS, Social Security Administration, and Department of Homeland Security, may be accessed to verify your information and check your eligibility.
Note: Immigrants in certain statuses qualify for coverage through the new marketplace or, in some cases, Medicaid. For information on the immigration statuses that qualify for marketplace coverage go to: https://www.healthcare.gov/immigration-status-and-the-marketplace/.
If your employer offers insurance coverage to you and your family, you can still buy a plan on the marketplace, but your employer will need to fill out the Employer Coverage Tool—a one-page information sheet about the plan(s) offered by your employer. If you’re buying insurance for someone else in your household whose employer offers them insurance, their employer will need to fill out the Employer Coverage Tool as well.
To see a list of information you need, as well as the Employer Coverage Tool, go here: https://www.healthcare.gov/downloads/MarketplaceApp_Checklist_Generic.pdf.
Starting January 1, 2014, eligibility for Medicaid, the Children’s Health Insurance Program (CHIP), and premium tax credits will be determined based on modified adjusted gross income (MAGI). MAGI is based on adjusted gross income (AGI), which is calculated on your federal tax return. Currently, methods for determining Medicaid and CHIP income eligibility vary widely from state to state; the MAGI method will replace individual state methods for calculating household income to determine eligibility.
To find out if you’re eligible for tax credits/subsidies or Medicaid, you can submit a single, streamlined application through the new Health Insurance Marketplace (AKA Exchange). You will provide basic income information on your application; the marketplace will import the rest of the relevant information from the IRS through the Department of Health and Human Services. The marketplace will then make an advance determination of your tax credit eligibility.
To see an estimate of your potential savings from tax credits and subsidies, check out the calculator here: http://kff.org/interactive/subsidy-calculator/.
To check out what you need to apply for insurance on your state’s Health Insurance Marketplace, go to: https://www.healthcare.gov/how-do-i-apply-for-marketplace-coverage/.
The “premium tax credit” is a new kind of monthly, advanceable tax credit that you can apply to your monthly premium costs if you buy a Platinum, Gold, Silver, or Bronze plan (AKA “metal level” plan) through the new Health Insurance Marketplace. Individuals and families with incomes between 133 and 400 percent of the Federal Poverty Level (FPL) – about $15,000 to $46,000 for an individual and $31,000 to $94,000 for a family of four – may be eligible for tax credits to lower the cost of their monthly premium for plans purchased on the Marketplace.
Note: premium tax credits will be available to consumers with incomes between 100 and 400 percent of the FPL in states that do not adopt the Affordable Care Act’s (ACA) Medicaid expansion. Tax credits will also be available to lawfully present immigrants with incomes between 0 and 400 percent of the FPL who are not eligible for Medicaid coverage.
In addition, “cost-sharing subsidies” will be available to individuals and families with incomes below 250 percent FPL who buy a Silver Plan on the Marketplace. This will reduce the amount you pay out-of-pocket when you use medical services, like your co-pay for a doctor’s office visit. The lower your income, the greater your reduction in out-of-pocket costs for medical services.
For more, go to: https://www.healthcare.gov/how-can-i-save-money-on-marketplace-coverage/ To see an estimate of your potential savings from tax credits and subsidies, check out the calculator here: http://kff.org/interactive/subsidy-calculator/
Medicaid is a joint program between state and federal governments that currently provides free or low-cost health coverage to certain categories of low-income people, including children, parents, pregnant women, and people with disabilities. The Affordable Care Act (ACA) would have made Medicaid coverage available to almost all low-income people making below 133 percent of the poverty level in all states. Due to a Supreme Court ruling on the law in 2012, however, each individual state will now decide whether or not to expand Medicaid to cover more low-income adults.
In states that do not expand Medicaid coverage, consumers with incomes between 100 and 400 percent of the Federal Poverty Level (FPL) – about $11,500 to $46,000 for an individual or $23,500 to $94,000 for a family of four – will be eligible for tax credits to help lower the cost of buying a plan on the new health insurance marketplace. To learn more about financial assistance available through the new marketplace, visit: https://www.healthcare.gov/how-can-i-save-money-on-marketplace-coverage/.
For those below this income level, though, there will unfortunately not be tax credits available in states that choose not to expand Medicaid, so these consumers may not be able to afford coverage.
Other (more limited) options for care for low-income adults living in states that do not expand Medicaid include:
• America’s community health centers (CHCs), with more than 9,000 locations nationwide, have traditionally been destinations for low-income individuals without insurance to get quality free or low-cost health care. The ACA increases funding for CHCs, as well as provides billions of dollars for opening additional CHCs in predominantly low-income areas, training nurse practitioners, and renovating and expanding existing facilities. Find a Community Health Center near you here: http://findahealthcenter.hrsa.gov/Search_HCC.aspx.
• Children in households under 200 percent FPL or higher in some states are eligible for coverage through the Children’s Health Insurance Program (CHIP). Find out more information on CHIP here: http://www.insurekidsnow.gov/.Some states have their own programs that provide insurance to very low-income adults. Check with your state’s Medicaid office to see what options are available: https://www.healthcare.gov/do-i-qualify-for-medicaid/.
Similar to current law, if you change insurance plans under the Affordable Care Act (ACA), you may have to change doctors if your current doctor is no longer within your new plan’s network. However, the ACA guarantees you the ability to choose any available primary care doctor covered under your plan, as well as the ability to choose any available pediatrician for your child. All new plans must now also fully cover out-of-network emergency room visits, so patients will be able to go to the nearest hospital without worrying whether they are out-of-network.
If you’re shopping for a plan on the new health insurance marketplace and need assistance to help finding a plan that includes your current doctor in its provider network, visit: https://www.healthcare.gov/chat/.
Starting in 2014, all newly issued plans will have to meet ACA requirements. If your plan does not meet these requirements, you will have to either purchase a different plan or pay a fine.
However, there is an exception for “grandfathered” plans. If you got your insurance plan before March 23, 2010, and have had the same plan continuously since then, your plan may be grandfathered and exempt from some ACA requirements. For example, grandfathered plans are not required to:
• Provide preventive care at no additional cost,
• Allow patients to choose from any doctor covered under their plan,
• Cover care at any emergency room, nor
• Allow you to appeal if you believe your rights have been violated.
But, grandfathered plans will still have to meet some ACA requirements. For example, even grandfathered plans are no longer allowed to:
• Apply lifetime dollar limits,
• Spend less than 80 percent of your premiums on care if you’re an individual, or 85 percent if you are on a large group employer plan, or
• Deny insurance coverage to young adults on their parent’s plan up to age 26.
To find out if your health plan is grandfathered, check you plan’s materials or talk to your insurer or employer. For information on how the grandfathered status of your plan could change, check out our additional FAQs on grandfathered plans or visit: https://www.healthcare.gov/what-if-i-have-a-grandfathered-health-plan.
Catastrophic plans are available under the Affordable Care Act (ACA) for individuals under the age of 30, or those who qualify for a “hardship exemption” because they cannot afford coverage. These plans will cover three primary care visits per year and preventive services before the deductible, and all essential health benefits after hitting the deductible. The plans will likely have a cheaper monthly premium than other, more comprehensive plans. However, these plans will have very high deductibles – meaning you may spend more than $6,000 each year out of pocket before your insurance starts to pay for care beyond those initial check-ups. So, while catastrophic plans are an option for individuals who want a low-cost plan and don’t think they’ll use a lot of health care services, you could have to pay more out of pocket. You also will not be able to use tax credits to purchase a catastrophic plan like you would to purchase traditional plans on your state’s Health Insurance Marketplace. For more information, see: https://www.healthcare.gov/glossary/catastrophic-health-plan.
There are TONS of places to get information and help! You can check out healthcare.gov, call the National Help Center, or contact your state’s Health Insurance Marketplace. In-person assistance from trained “Navigators,” “assisters,” and “Certified Application Counselors” will also be available in each state to help consumers understand their health insurance options and find out how to enroll in a plan.
Yes. Here are some things to consider:
- You may be healthy now, but you never know when you might get sick or injured. If you’re uninsured, you’ll have to pay the full cost of treating that illness or injury out-of-pocket. Even common illnesses and injuries, like a broken bone, can cost several hundred to several thousand dollars to treat without insurance. Large medical bills could lead to debt or even bankruptcy and endanger your financial future. Getting covered now will help ensure financial security later.
- If you get health insurance, you will now have access to preventive care at no additional cost, which can help you stay healthy. Examples of preventive services covered under health care reform include: immunizations, well-woman visits, contraception, depression screenings, alcohol misuse screenings, and HIV and STI screenings and counseling. If you have health insurance, you won’t have to pay anything out-of-pocket for covered preventive services when you get them from a doctor or provider in your insurer’s network.
- Starting in 2014, you’re required to have health insurance or pay a penalty. The penalty will start off relatively low, at $95 or 1% of your annual income, whichever is greater, in 2014, but will steadily increase, to $695 or 2.5% of your annual income in 2016. (Individuals who can’t find affordable coverage or who meet certain other criteria will be exempt from paying the penalty.)
Under health care reform, all new policies must cover certain preventive services at no additional cost to you. Examples of covered preventive services include: immunizations, well-woman visits, contraception, depression screenings, alcohol misuse screenings, and HIV and STI screenings and counseling. If you have health insurance, you won’t have to pay anything out-of-pocket for these services when you get them from a doctor or provider in your insurer’s network.
Starting in 2014, all individual plans (plans that you buy yourself rather than get through your employer) must offer a comprehensive package of items and services, known as “essential health benefits.” Essential health benefits will include items and services like: emergency services; hospitalization; maternity and newborn care; mental health and substance use disorder services; prescription drugs; and preventive and wellness services and chronic disease management. All plans offered through the Health Insurance Marketplace and Medicaid must cover these benefits by 2014.
Beginning January 1, 2014, you can no longer be denied coverage, lose coverage, or be charged more for coverage because of a “pre-existing condition.” The health care law already prohibits health insurers from limiting or denying benefits or coverage to children under 19 with pre-existing conditions – in 2014, this provision will apply to everyone. Also starting in 2014, insurance companies will no longer be able to put dollar limits on how much care is covered under your plan, annually or over the life of your plan.
Starting next year, if you don’t have health insurance, you’ll pay a penalty. The penalty will start off small in 2014 – $95 per adult or 1% of your household income, whichever is greater – but increase thereafter – to $695 or 2.5% of your income in 2016. There are a few exceptions, or situations under which you would not have to pay the penalty. These include:
- If you’re uninsured for less than 3 months in a year.
- If you can’t find coverage for less than 8% of your income, after tax credits and any contributions by your employer are applied.
- If your household income is below the threshold for filing income taxes (about $10,000 for individuals and $20,000 for married couples).
- If you’re incarcerated, an undocumented immigrant, or a member of an Indian tribe.
- If you have a religious conscience exemption.
- If you qualify for a special hardship exemption.
Your parent or guardian can add you to their existing employer-sponsored group health plan (if the plan offers dependent coverage), or buy a family plan on the new Health Insurance Marketplace. Either way, as long as you’re under 26, you can be added to your parent’s plan – even if you’re married, not living in the same state, and/or not financially dependent on your parents. Go here for more information.
- The state that you live in will affect where you go to get information on and sign up for plans on the new Health Insurance Marketplace. Go here to get more information on the type of marketplace in your state.
- The state that you live in will also affect whether you can qualify for coverage under Medicaid. Starting in 2014, some states will be expanding Medicaid coverage to all individuals making less that $15,000 (or $31,000 for a family of four). To learn more about your state’s Medicaid program, visit Medicaid.gov.
- However, it does not matter what state you live in if you want to be added to your parent’s insurance. Thanks to the health reform law, you can be covered under your parent’s health plan until age 26 – even if you don’t live in the same state as your parent or guardian.
- If you’re an individual making between about $15,000 and $46,000 per year (or $31,000 to $94,000 for a family of four) and buy a plan through the new Health Insurance Marketplace (AKA Exchange), you may be eligible for a new kind of tax credit to lower the cost of your health plan. The tax credits can be applied up front to the amount you pay each month for you plan (premium), so you won’t have to wait until tax time to see the savings. You’ll see the amount of tax credit you’re eligible for when you submit an application through the Marketplace. Open enrollment in the Marketplace begins in October 1, 2013.
- If you make less than about $29,000 (or $59,000 for a family of four) and buy a “silver” level plan on the Marketplace, you may be eligible for cost-sharing assistance to help cover the out-of-pocket costs (co-pays, co-insurance, deductibles) that you pay in addition to your monthly premiums.
- If you’re under 30, or any age and cannot find a plan for less than 8 percent of your income, you can enroll in a lower-cost catastrophic plan. These plans have higher deductibles; they only offer preventive care and primary visits before a $6,000 deductible, after which all essential benefits are covered. In other words, the plans help to provide basic routine care and protect against major medical catastrophes, but may still require significant out of pocket spending .
- If you’re an individual making less than $15,000 (or $31,000 for a family of four), you may be eligible for coverage under Medicaid in some states. You can find out if your state is participating in the Medicaid expansion here.
There are several new options for getting covered:
- You can now get health insurance through your parent’s plan until age 26, even if you’re a student or married.
- Starting October 1, 2013, you can buy a plan through the new Health Insurance Marketplace (AKA Exchange) in your state, where you’ll have a choice of health plans at different levels of coverage. If you’re low or middle income, you can get tax credits that will lower the cost of your plan. To see if you may qualify for tax credits, go here.
- Low-income adults will now qualify for Medicaid in some states. Find out if your state is participating here. Previously, Medicaid was often limited to much lower incomes or to individuals with children.
- If you’re under 30 or can’t find other affordable coverage, you’ll be able to buy a catastrophic plan. These plans will have a lower monthly cost (premium), and will cover three primary care visits and preventive services at no cost. But, you’ll have to pay a lot more out-of-pocket (deductible) for additional services before they’re covered by your insurance. Caution: you won’t be able to use the new tax credits to buy a catastrophic plan.