With the Affordable Care Act (ACA) or Obamacare, people are more confused than ever. There are horror stories of family premiums approaching $20,000/yr as well as scenarios where others are getting theirs for free. So what is the reality?
The truth is usually somewhere in the middle. So what are your options as a shopper.
You can purchase a plan on the government (public exchange), or a nearly identical plan off the exchange. The plans available are referred to as the Metallic series (Platinum, Gold, Silver and Bronze). The same Metallic series offered on the public exchange is typically offered by the same insurance companies off the exchange. For young people under age 30, there’s also the Catastrophic Plan. The benefits and prices of all these plans are nearly identical. So you may ask what is the difference if I buy on vs offthe exchange with everything else being nearly the same. The short answer is 'premium tax credits or premium subsidy'.
The primary objective of Obamacare was to get health insurance into the hands of those who could not afford the price or was uninsurable due to a pre-existing condition. The law mandates that all plans must take everyone regardless of their pre-ex conditions. To address the affordability aspect, the law created a formula based on a multiple of the Federal Poverty Level (FPL) in determining how much the government will subsidize your premium. To determine how much of a subsidy you may qualify for, take a quick jump over to our subsidy calculator. In our opinion, the only reason to buy on the public exchange is if you are taking advantage of the subsidy, otherwise there's no need to subject yourself to the government website when a nearly identical ACA approved product can be obtained off exchange.
Additionally, many people who’ve purchased ON exchange plans are finding that the networks of doctors and hospitals associated with these plans are limited compared to the similar benefit plan this is available OFF exchange. In fact, many of the world renown Centers of Excellence such as the Mayo Clinic, Cleveland Clinic and such others are often not affiliated with ON exchange plans.
Therefore, if you are not eligible for a significant premium subsidy, you may want to give serious consideration to acquiring a qualified health plan OFF exchange. With an OFF exchange plan option, you are more likely guaranteed to maintain your doctors and hospitals of preference.
There is also a very viable third option we advocate to our clients and that is to purchase a Short Term Medical plan. These are not ACA approved, so you would have to also pay the penalty; however, their premiums are coming in at significantly less compared to the ACA approved Metallic plans. The catch is you do have to qualify by answering seven short health questions.
To help determine which route is best for you, we recommend having one of our licensed, independent insurance experts evaluate your needs. Invariably, they can find you lower cost options than even through an employer. Best of all, since insurance premiums are regulated by law, the premium is the same regardless if you go it alone or call on one of our agents to shepherd you through this maze.z
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