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The marketplace is a virtual system to help people compare and buy health insurance. Most people that use the marketplace will qualify for help paying for their coverage based on their income. In Maine we use the Federal Marketplace, www.healthcare.gov.
To be eligible for health coverage through the marketplace, you:
– Must live in the U.S.
– Must be a U.S. citizen or national (lawfully present)
– People who do not have creditable coverage, such as Medicare, Medicaid, VA benefits
– For those with an income between 100 and 400% of the Federal Poverty Level, you can qualify for a tax credit/subsidy to pay for your insurance
The exchange means the marketplace. Whether you buy on-exchange or off-exchange, you are still buying health insurance. On-exchange means that you are eligible for financial assistance in paying for your health insurance and you purchase your coverage through the marketplace (i.e. www.healthcare.gov). Those buying off-exchange don’t qualify for help paying for the coverage and they would apply directly with the insurer.
Plans are broken down into categories which refer to the coverage level you are purchasing. In the Marketplace, Bronze plans will have the highest deductibles and on average, the plan will cover 60% of your medical services. Silver plans have a modest deductible and will cover an average of 70% of your medical expenses. Gold plans have the lowest deductible and will cover an average of 80% of your medical expenses.
If your income is between 100% and 250% of the federal poverty level, you can qualify for cost sharing reductions. These will reduce the deductibles, copays, and other cost sharing that would otherwise apply to covered services. Cost-sharing reductions are only available on Silver plans.
Catastrophic plans have the highest deductibles and are only available to those age 29 and younger. Some older adults can purchase a catastrophic plan if there are no marketplace plans that cost less than 8% of their income.
Insurance is the practice of pooling risk and protecting individuals with financial protection against losses. By pooling the risk of those who are healthy and unhealthy, payments become more affordable for everyone. Open enrollment periods help protect insurance companies from people only buying coverage when they need it. If insurers left the door open to enroll year- round, they would go out of business because they were only insuring those using the benefits. Outside of open enrollment, individuals can qualify for a Special Enrollment Period (SEP) if they experience a qualifying life event like a marriage, birth, divorce, move, or loss of coverage and make a plan change within 60 days of that event.
It may be in your best interest to get coverage through your employer and insure the rest of your family through the marketplace. If you have job-based coverage available to your dependents, you can buy insurance through the Marketplace, but you may not qualify for premium tax credits or other savings that can make Marketplace insurance more affordable. We can discuss the options with you and help you evaluate the best course of action.
You do have the option to insure your adult children, up to age 26, even if they are married, not living with you, or financial independent, however you may not qualify for a tax credit to cover their portion of the premiums. If a child under 26 isn’t a dependent for the parent’s tax purposes, the marketplace recommends that young adult fill out their own application to apply for a tax credit.
No. In general, once you sign up for the plan you are locked into that coverage for 12 months or until open enrollment. A change in health status does not make you eligible for a special enrollment opportunity.
If you don’t update your application, in most cases, healthcare.gov will automatically continue the amount of your 2015 premium tax credit for 2016. It’s a good idea to update your application to ensure your projected income for 2016 is up-to-date and you are getting the right amount of help paying your premiums. You can update your income any time of year and whenever there is a change in income, it’s recommended you contact the marketplace to get a revised eligibility determination regarding your tax credit/subsidy.
The penalty for not having health insurance is either a flat amount or a percentage of your household income, whichever is greater.
In 2016 the penalty will be:
– $695 for each adult and $347.50 for each child, up to $2,085 per family, OR
– 2.5% of family income
This page was updated 1/29/16.