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The Ultimate Guide
to Self-Employed
Health Insurance

Introduction

Purchasing health insurance, whether you are an individual, family, retired, unemployed, or self-employed, can be an overwhelming task. Many people have had coverage through their employers. The bulk of the decision making on those available plans rests on business owners, and even they have some questions about what the Affordable Care Act roll out. Often referred to as, ObamaCare, the ACA was signed into law in October 2010 by President Barack Obama, programs began in 2013 and 2014, and the government will continue to make adjustments to the program until 2022. If the law wasn’t already complicated enough, modifications to provisions and tax law throw consumers a new curve each year.

The Affordable Care Act seems to be achieving its intended goals. “The Centers for Medicare & Medicaid Services (CMS) released a new report … showing that consumers have received more than $2.4 billion premium rebates since 2011 because the Affordable Care Act requires that health insurance companies spend at least 80 percent of premium dollars on health care”.

As we go into the year 2016, we prepare to either review the policy we had last year, or begin a new policy considering our individual circumstances. This article is to help both individuals and those who are self-employed, find out about new health insurance plans, what is covered, where to get it, and how to get it.

Begin the search for information at the online Health Insurance Marketplace. Enrollment begins November 1, 2015 and continues through January 31, 2016. The deadline to begin a new policy, with coverage beginning January 1, 2016, is December 15, 2015. This will be easy for many to remember since it is virtually the same as the dates for enrollment in new Medicare Supplement policies as well. Consistency was one main objective for implementing the ACA law.

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Terms and Definitions

These definitions are intended to help you understand the information being discussed in multiple chapters and sections.

  • Affordable Care Act (ACA) –The new health insurance law put in to effect by President Obama in 2010 to make health care affordable, consistent, and available to everyone.
  • Alaska Native Claims Settlement Act (ANCSA) Corporation Shareholder – Special Marketplace protections and benefits are available for American Indians and Alaska Natives.
  • Allowed Amount – the amount the insurance plan determines is reasonable for the covered service. If an out-of-network provider charges more than the allowed amount or covered charges, you may have to pay the difference.
  • The American Recovery and Reinvestment Act of 2009 (ARRA) – a 2009 economic stimulus package
  • Coverage Gap – refers to the segment of the adult population living in poverty but with incomes that make them ineligible for Medicaid because their state didn’t expand Medicaid coverage.
  • Coinsurance – your share of the costs of a covered service, calculated as a percent of the allowed amount or covered charges for that service as determined by the plan. A common percentage would be 80/20.
  • Copayments – flat fees like the $15 or $25 you pay when visiting your doctor’s office or other specialist.
  • Custodial Care – non-medical assistance with the activities of daily life (bathing, eating, dressing, using the toilet) for someone who’s unable to fully perform those activities. Service is provided either at home, a nursing home, or assisted-living facility.
  • Disability –a physical or mental impairment that substantially limits one or more major life activities including, caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, and working.
  • Employer-Based Health Insurance (job-based) – health insurance coverage provided at a place of employment. Employers choose the plans and provide the same options to all employees, sometimes sharing the premium costs associated.
  • Evidence of Coverage – a detailed explanation of the health and prescription drug benefits and services available to you including information on how to use your coverage, details about your copays, a description of your member rights and responsibilities, and a glossary of terms.
  • Exemption Certificate Number (ECN) – a number assigned when you qualify for a hardship exemption that will enable you to apply for other non-qualified coverage, such as a Catastrophic Plan, without penalty.
  • Express Scripts – Express Scripts makes the use of prescription drugs more affordable through thousands of employers, government, union and health plans. It handles prescriptions through home delivery and retail pharmacies. It is partnered with the military prescription plan Tricare.
  • Extra Help – Federally run program for prescription coverage provided for qualified individuals for Low Income Subsidy (LIS)
  • Federal Employee Health Benefit Plan (FHEB) – The Federal Employees Health Benefits Program is a system where employee health benefits are provided to civilian government employees and annuitants of the United States government. They include prescription drug coverage.
  • Hardship Exemption – a qualified exemption due to hardship will void the individual mandate penalty.
  • Health Reimbursement Arrangement (HRA) – an employer sponsored account for retirees to use for reimbursement of medical expenses, including an individual policy through a Marketplace or in the non-group market.
  • Incarcerated Individual – for the purposes of ACA, it applies only to people serving a term in prison or jail.
  • Individual Health Insurance Marketplace –The Individual Health Insurance Marketplace, often called the “Marketplace” or “Exchange,” is a resource for individuals and families to shop and enroll in an ACA approved health insurance plan. It also makes programs available to help people pay for coverage.
  • Individual Mandate – fee, fine, or penalty applied at tax time if you have not been covered by an insurance plan for the prior year. It is either a flat fee or based on your household income.
  • (LEP) Limited English Proficiency – an organization providing all health insurance information and materials written in other languages with clearer notices, websites, and non-English headings and descriptions on notices. It Offers in-person assistanceand supports to people, making sure consumers can easily access the use of interpreters and other language-assistance services.
  • Long-Term Care Insurance – helps provide coverage for the cost of long-term care for an extensive period of time. It covers services including personal and custodial carein a home, a community, or facility. Long-Term Care is usually not covered by health insurance, Medicare, or Medicaid.
  • Low Income Subsidy (LIS) – a Medicare Part D benefit providing financial assistance known as Extra Help to those with limited income and assets. If you are eligible for Extra Help, Part D premiums, deductibles and copayments can be eliminated or reduced and you will not be exposed to the Coverage Gap.
  • Network –A group of doctors and hospitals that participate in a health insurance plan. It is designed to lower out-of-pocket costs by using providers and facilities that have already been approved to be part of your health insurance plan’s network.
  • Marketplace Metal Categories – Plans are categorized by Bronze, Silver, Gold, and Platinum indicating coverage and out-of-pocket expenses.
  • Medicare – a federal health insurance program for people who are 65 or older, certain younger people with disabilities, and people with End-Stage Renal Disease (permanent kidney failure requiring dialysis or a transplant, sometimes called ESRD).
  • Medicaid – A joint federal and state program helping qualified low-income individuals or families pay for the costs associated with long-term medical and custodial care. Largely funded by the federal government, Medicaid is run by the state, and types of coverage may vary.
  • Medicare Advantage – a United States health insurance program of provider networks (like preferred provider organization (PPO) or health maintenance organization (HMO)) that substitutes and combines Parts A (Hospital Insurance) and Part B (Medical Insurance) of Original Medicare benefits becoming Part C.
  • Medicare Part D – the Medicare prescription drug benefit; a federal-government program to subsidize costs of prescription drugs and prescription drug insurance premiums for Medicare beneficiaries.
  • Medicare Savings Account (MSA) – a consumer-directed Medicare Advantage Plan, similar to Health Savings Account Plans, available outside of Medicare. You have flexibility in choosing your health care services and providers.
  • Medicare Supplement – Insurance that qualified Medicare recipients can purchase to fill the “gaps” in their Original Medicare coverage. These gaps are deductibles, co-payments and expenses not paid by Part A or Part B.
  • Minimum Essential Coverage (MEC) – a type of coverage you’ll need to avoid the fee for not having insurance under the Affordable Care Act.
  • Open Enrollment –The period of time that qualified individuals can enroll in a certified ACA health insurance plan or switch to a new plan; November 1st through January 31st.
  • Out-of-Pocket Costs – Your total expenses for medical care that are not paid by your health insurance plan. This does not include your premium cost.
  • Pre-Existing Conditions – medical conditions and diagnosis of conditions you have prior to the start of new health insurance coverage. Qualified plans no longer allow the use of a pre-existing conditions clause.
  • Premium – The amount you pay each month to keep your health insurance plan active.
  • Prescription Drug Plan (PDP) Late Enrollment Penalty – The late enrollment penalty is based on the average premium amount for prescription coverage which is $34.10 in 2016. You will be charged 1% of the premium penalty for each month you were not covered by a Part D or PDP plan.
  • Short Term Plans – These policies are not regulated by the Affordable Care Act like regular Major Medical plans, and their sale is not limited to open enrollment periods.
  • Special Enrollment – circumstances like losing Medicaid coverage due to an income change, aging off a parent’s plan, or COBRA coverage ending, will allow you to enroll outside of the open enrollment period. You will receive a letter stating the reason you are granted enrollment at that time to take to your insurance agent or submit online for coverage. It ends by December 31st no matter when it starts.
  • State Prescription Assistance Program (SPAP) – State Pharmaceutical Assistance Programs are state-run programs assisting low-income seniors and adults with disabilities with their prescription drug costs. SPAP coverage varies by state, but the programs generally provide coverage to pay costs that Medicare Part D does not pay.
  • Summary of Benefits – an easy-to-understand summary about a health plan’s benefits and coverage.

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Individual and Self-Employed Healthcare

Individuals under the age of 65, not covered by an Employer-Based plan at work, can shop for health insurance plans online using the Health Insurance Marketplace, on Insurance Company websites, or through an insurance agent. If you already have a plan, you should still take a look due to changes from one year to the next. These changes may affect your coverage, providers, deductibles, co-insurance or premium. Aside from variations to existing policies, brand new plans may be available, creating new choices to make for which plan is currently your best option. Since the roll out of the Affordable Care Act is not considered complete until 2022, it is recommended to stay current with any modifications in the law and coverage.

Self-Employed, Freelance, and Entrepreneurs, are a rapidly growing group that has always had to deal with their own insurance coverage. If they are working solo then all individual plans can be considered. If they are contracting help, again, individual plans will apply to them and their contractors. Self-employed people with limited groups of employees will want to look at (SHOP) Plans designed for small business.

All qualified Affordable Care Act plans have a minimum of 10 services to offer including doctor visits, prescription drugs, hospital visits, maternity and newborn care, and preventative care. A few will offer vision, dental, or medical management programs, but those additions are not generally included.

The following is a list of 10 categories you will see in every plan:

  • Children’s healthcare with vision (occasionally dental)
  • Emergency Care
  • Hospitalization
  • Laboratory Services (like X-rays)
  • Maternity and Newborn Care
  • Mental Health and Substance Abuse Care
  • Outpatient Care (Doctor Visits and Outpatient surgery)
  • Prescription Drugs
  • Preventative services (like Immunizations and Cancer Screenings)
  • Rehabilitative Care (Physical and Speech Therapy)

Reasons you may find yourself shopping for insurance as an individual may vary. You may have lost a job, and therefore the insurance that came with it, you may be a commission based contractor with an income that is hard to predict, self-employed with a small income, or starting your own new business. Whether you go to the Marketplace, an insurance agent, or directly to an insurance company website, know the ACA law and find a qualified plan or face a penalty at the end of the tax year. Qualified plans must be purchased during Open Enrollment November 1st through January 31st.

There are some exceptions to Open Enrollment where you may not be regulated by the dates such as cancelling a non-qualified plan and coinciding dates with a qualified plan for replacement.

If you have lost or left a job

Regardless of the reason you are no longer employed, you are allowed to purchase a plan outside of the Open Enrollment dates. COBRA plans are notoriously expensive, but have to be offered by the employer by law. The less expensive decision would be to have a letter from your employer explaining the circumstances around your job loss and subsequent loss of coverage, allowing you 60 days to enroll in a Health Insurance Marketplace plan.

Learn what to do if you lose job-based health insurance

If you have a contract job and your income varies

You are able to apply with the best estimate of your income for the coming year. You will need to be as accurate as possible, because savings is based on that figure. If your income changes, you need to update the information with the plan carrier to make the adjustment. Whatever savings you qualified for will go up or down when you have your year-end numbers ready for Federal Taxes.

Learn about health coverage if you’re self-employed.

Self-employed ambitions have yet to produce substantial income

There are ways to qualify for low-cost and free coverage through Medicaid. Adjustments can be made later when your income increases allowing you to change coverage to a Health Insurance Marketplace plan when you are ready.

Learn about Medicaid & CHIP

Starting a new business

This is an exciting but hectic time. If you are a sole proprietor, you will be shopping for an individual plan. If you have some employees on the payroll, you may be able to get your coverage, as well as that of your employees, through the Small Business Health Options Program (SHOP). Depending on the number of employees, you could qualify for tax credits for up to 50% of your premium costs.

Learn about Small Businesses

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Questions to Ask When Looking For a Plan

Like most things, finding the right plan means researching the process. It helps to know some basic questions to get started with, and those questions might lead to more once you’re headed in the right direction. I can tell you that even licensed insurance agents have a tough time answering specific health insurance questions without knowing where to look for the answers. There is simply more information available than one person can retain.

Question 1: What is a more important issue for you?

  • Out-of-Pocket costs for the plan and services
  • Having access to the same doctors and specialists you’ve had in the past
  • Being able to use the closest hospital or urgent care facility
  • Prescription coverage for medications you need or will be needing
  • special services (like equipment or service for a disability)

Question 2: What are Out-of-Pocket costs?

  • Deductibles
  • Copays
  • Co-insurance

How much you will pay out-of-pocket before the plan begins coverage, depends on the amount of your deductible, copay, or coinsurance. Health insurance deductibles are a dollar amount you need to meet before coverage begins for that policy period.

Copays are the small fee you pay to walk into your doctor’s office each time you visit. It may be a little larger for a specialist.

Co-insurance is a percentage of the cost of a procedure that you share with the insurance company. An example would be 80/20, where the first number is the insurance company percentage and the second portion is your responsibility.

These out-of-pocket amounts are all stated on your policy under a Summary of Benefits, your Evidence of Coverage, as well as your insurance card.

Question 3: Does the physician speak your preferred language?

More and more we’ve shifted to being a bilingual country, and often come across people speaking several different languages in certain areas and cities. If you have a doctor that is able to communicate in your preferred language, that may be a consideration in choosing whether to be in a network, or not.

Language– Meaningful Access for People with Limited English Proficiency (LEP): This organization has all health insurance information and materials written in other languages with clearer notices, websites, and non-English headings and descriptions on notices providing ways to find help. Enroll America knows it’s vital to make in-person assistance available to people, and also supports making sure consumers can easily access the use of interpreters and other language-assistance services.

To learn more about (LEP) read this PDF called Understanding the Uninsured Now

Question 4: Do you have a disability?

Does the plan include accessibility to needed equipment? To be sure go to the National Disability Navigator Resource Collaborative for a Disability Guide.

Read the Disability Guide PDF here.

Question 5: Are you already taking medications you need coverage for?

Be sure the plan covers the medications you know you need.

Question 6: How many times a year does the plan pay for health care services you might need or are already using?

There may be restrictions on how many times you can file a claim for the same service.

Question 7: What is a provider network?

Health insurance plans are either designed to work inside or outside of a network of providers: doctors, specialists, medical facilities, and hospitals within a particular region or area.

  • If you have a provider network, you are required to choose your providers from inside the network or you will not be covered. You may also have the option to pay the difference between what the insurance company charges and what the provider charges for services.
  • If you do not have a provider network, you can receive treatment anywhere you like and your insurance will be accepted.

Question 8: Are the providers in the network easy to get to?

You may not have a particular doctor you want to visit, but be sure there is one in the network that is convenient for you. Just because there is a hospital 1 mile away from you doesn’t mean that facility will be selected for your network. If you’ve used a specialist for a specific issue in the past, make sure there is a similar specialist or clinic located nearby or within reason.

Overall, do you feel the plans rules are fair for covering out-of-network care and referrals or likely to get in your way of the care you need? Take a look at the definitions of provider plans to be sure you understand them and how they work.

Types of Plans and Provider Network Rules

Health Maintenance Organization (HMO)

All your health care services go through a primary physician of your choice. That doctor refers you to any other health care professionals, except in an emergency. Visiting doctors outside of your network will not normally be covered by your insurance. Choosing to coordinate your health care through your primary physician creates less paperwork and keeps health costs down.

Preferred Provider Organization (PPO)

PPO doesn’t require a primary care physician. You can go to any health care professional you want without a referral, both inside or outside of your network.  Staying inside your network means smaller copays and full coverage. If you choose to go outside your network, there are higher out-of-pocket costs, and not all services may be covered.

Exclusive Provider Organization (EPO)

EPO plans have the flexibility of PPO plans with the lower cost of HMO plans. No primary care physician or referrals needed to see a specialist, but there is a limited network of doctors and hospitals to choose from. EPO plans don’t cover care outside your network unless it’s an emergency. If you go to a doctor or hospital that is not in your plan you’ll pay all costs.

Point of Service (POS)

A point of service plan is a type of managed care health insurance that combines physician referral like an HMO and stays inside a more limited network than a preferred provider organization (PPO) to keep medical costs lower. The POS is based on a managed care foundation.

As you can see, each uses a network, but how you interact within in it makes the difference. Knowing the difference will help determine the best one for your needs.

Learn more about the differences between provider networks here.

Questions to Ask When Renewing a Policy

Coverage and changes to ACA laws mean it is in your best interest to check what is going on with your plan coverage before it renews so you have a chance to make changes. Your personal circumstances can change, and some of the coverage or expenses could be different.

Question 1: Will your premium increase in 2016?

Premiums rarely stay the same for long, so it’s a good idea to check the marketplace to know your cost upfront. In states that used the HealthCare.gov platform, it has already been noted that consumers switching marketplace plans within the same level of coverage saved nearly $400 in annual premium costs. That is a significant saving and it could happen again this year too.

Question 2: Is the amount you pay out of pocket affordable?

Now that you’ve had the plan for a year, how did it stack up? Did you spend about what you expected or was it above or below your target? An agent or market place navigator can help you evaluate the plan and see if another plan would cost less and still give you the same protection.

Plans are broken down into metal levels of Gold, Silver, and Bronze and indicate the percentage of annual costs the plan is expected to cover for the consumer. The Healthcare costs are a rough estimate and can be much different than anticipated. There may be a specific reason for this and a different plan can take that into account. Also, be sure that you can pay for doctor visits until reaching the stated deductible amount or you may consider higher premiums to offset a plan with a lower deductible.

Learn more on what you need to know about health insurance.

Question 3: Could you be getting more assistance this year?

Have your economic circumstances changed in the last year? This is a good reason to re-evaluate your plan choice and check the marketplace for plans once again.

Question 4: Is your current provider still in the network?

Your doctor and other health care providers sign a contract each year to continue within your network. They may decide to opt out for one reason or another. Check with your doctor before renewing your plan.

Your plan Summary of Benefits and Coverage keeps a list of healthcare spending for you throughout the year. Take a look at it to be certain of what you are spending and on what services. There is a breakdown of costs for each category: doctors, specialists, prescriptions, etc.

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The Affordable Care Act (ACA)

The Affordable Care Act put in place comprehensive health insurance reforms that have improved access, affordability, and quality in health care for Americans. Because of the Affordable Care Act, most people in the US must have health coverage or pay a fee (a fine, penalty, or individual mandate) called the individual shared responsibility payment. You owe the fee for any month you, your spouse, or your tax dependents, don’t have health insurance that qualifies as minimum essential coverage. If you have the minimum coverage you don’t have to pay the fee. Many people can start with their most recent year’s adjusted gross income and update it to account for upcoming changes. Savings are based on the prior year taxes, not the current one.

Individual mandate

The penalty has been phased in since 2014. If you do not have the minimum essential coverage you will be charged either a flat amount, or a percentage of household income, whichever is greater.

In 2015, the penalty is the greater of:

  • $325 for each adult and $162.50 for each child, up to $975 per family, or
  • 2% of family income above the federal tax filing threshold, which is $10,300 for a single filer, $20,600 for people who file jointly

In 2016, the penalty is the greater of:

  • $695 for each adult and $347.50 for each child, up to $2,085 per family, or
  • 2.5% of family income above the federal tax filing threshold

In later years, the flat penalty amounts will be indexed based on the cost of living.

The penalty is capped at an amount equal to the national average premium for the bronze health plan available in the Exchange (online Marketplace).

The penalty is assessed based on “coverage months.” Each month you are uninsured, you may owe 1/12th of the annual penalty, but smaller periods of being uninsured may not be penalized.

Learn more about the fee for not having health insurance here.

Having health insurance and doctors gives you and your family peace of mind. No one knows exactly when injury or illness might strike, so being prepared gives us less to worry about especially when it comes to catastrophic health issues. Staying healthy means staying protected, and new laws are designed to help us afford it.

All plans on the online Marketplace are certified plans and meet minimum requirements set forth in the ACA law. Whether you buy one online, from an agent, or another source, it must pay at least 60% of the total cost of medical services and cover the majority of hospital and doctor services. The consumer share should not be more than 40%.

The Health Insurance Marketplace is not for people who have coverage available through work. If you have coverage there, and it is certified to meet ACA minimum standards, you won’t qualify for tax credits. Most jobs meet the certification. You can ask your employer if your share of the monthly premium for the lowest cost “self only” coverage is less than 9.56% of your household income. Before declining or canceling job based insurance, know this:

  • employers pay part of the premium and you will lose that benefit
  • you will likely lose the premium tax credit even if your income qualifies you
  • You will have to pay full price for the plan.

Qualifying for a tax credit is calculated by estimating your annual income and reducing premium costs up front, then adjusting your federal taxes at the end of the year according to the actual income.

Open Enrollment and Special Enrollment Periods

There are 2 types of enrollments. A regular open enrollment period from November 1st through January 31st and a special enrollment period reserved for life changing events like having a baby, getting married, or losing health coverage.

Any 2015 plan you enroll in with a Special Enrollment Period ends December 31, 2015, no matter when it starts.

The same rules apply if you lose other kinds of Minimum Essential Coverage (MEC), like losing Medicaid coverage due to an income change, aging off a parent’s plan, or COBRA coverage ending.

Learn about Minimum Essential Coverage (MEC) and types of plans that will not result in fees.

Other circumstances that allow Special Enrollment consideration might be:

  • Moving to a new state
  • Changes in your income that affect the coverage you qualify for
  • Gaining membership in a federally recognized tribe or status as an Alaska Native Claims Settlement Act (ANCSA) Corporation shareholder
  • Becoming a U.S. citizen
  • Leaving incarceration
  • Change of dependency status of someone on your plan
  • Death of a covered member of your household
  • Turning 26 and aging off your parent’s plan
  • AmeriCorps VISTA members starting or ending their service

Calculating Plan Prices

The Health Insurance Marketplace Calculator was created by the Affordable Care Act to estimates health insurance premiums and subsidies for people purchasing insurance on their own in health insurance exchanges (Marketplaces) . Enter your income, age, and family size to estimate the subsidy amount you may qualify for and how much you could spend on a health insurance plan. This same tool can estimate your eligibility for Medicaid, but since those requirements may vary by state, contact your state’s Medicaid office or Marketplace for enrollment questions. To use this tool, just click here.Another option to calculate by zip code, for either individuals or small business owners, is available below:

Reminder: Cost-sharing can lead to unexpected costs for some people and can be difficult to estimate when comparing plans or reviewing medical bills. Even though there is much more standardization and transparency for individual market coverage than before the law went into effect, the answer to the question – ‘How much will I spend on health care?’ – is not always straightforward.

Learn more by reading this article about medical debt among people with health insurance.

The Health Insurance Plan Search will help you get an idea of basic plans without having to make any kind of commitment while learning. It walks through the process to estimate your personal cost. You can see ahead of time if your doctors and prescriptions are covered.

Learn more about 2016 Health insurance plans and prices by using the Market Plan Search here.

If you want personal assistance, find someone nearby to help you apply.

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Do I need a health insurance agent?

A licensed health insurance agent can explain the summary of benefits and Evidence of Coverage documents. They can give specific details of how the plan works, possible exclusions that would affect you, check the drug formulary for your medications, and make sure you get a copy of coverage in writing.

Between your personal circumstances, the volume of plans and plan information out there, changes to laws and qualification processes, insurance agents can be a great way of discovering options you didn’t know you had. Be selective when choosing an agent. There are independent agents and those that work for specific companies. Look for someone representing health insurance companies you know have a good reputation for products. Find out if someone in your circle of friends or family knows an insurance agent that they trust. If they can’t adequately answer your questions, find an agent who can.

There is also the choice to use an online navigator for assistance to sign up. Using this service increases your chances of successfully enrolling in the product that will work best for you.

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Plans with Separate Drug Deductibles and Costs

Most gold and platinum plans, and many silver plans, have separate medical and drug deductibles and different cost-sharing options.

Deductibles

Once meeting your separate drug deductible, the plan begins to pay for prescription costs. Since the medical deductible and drug deductibles aren’t related, you don’t need to meet both just to get one to begin to pay. Deductibles can vary greatly, but an average range between Bronze plans and Platinum plans it $5,500 to $409. There are prescription plans available with a $0 deductible. Currently, 58 percent of Silver Plans, 65 percent of Gold, and 93 percent of Platinum show $0 deductibles and begin to pay toward prescriptions immediately.

The amount and type of cost-sharing within plans varies across different drug tiers or pricing levels to encourage the use of lower-cost alternatives or to pass on the higher cost of some drugs. Generally, we face lower cost-sharing for generic and preferred brand-name drugs and higher cost sharing for non-preferred brand-name drugs and specialty drugs. Plans will have copayments and coinsurance in each drug tier; copayments are more common for generic drugs. Some plans have no additional cost sharing once you meet the deductible.

The level of cost sharing also varies across the metal tiers of plans: for example, copays are likely to be higher in bronze plans than in more expensive plans for each of the drug tiers. The average copayment amount for 2016 preferred brand-name drugs on a bronze plan is currently $67, for silver plans its $48, for gold plans its $39, and for platinum plans it’s about $30.

Out-of-Pocket Maximums

An out-of-pocket maximum is the maximum dollar amount that an insured is required to spend on covered services received from network providers in a year. After meeting this maximum amount, the plan pays all covered services. Health plans sold in the Marketplace have a cap on out-pocket maximums for in-network services not to exceed more than $6,850 for an individual plan and $13,700 for a family plan. Almost all plans offered on the exchange have a combined out-of-pocket maximum for medical and prescription drugs. Forty-seven percent of bronze plans and 35% of silver plans have an out-of-pocket maximum for single coverage at the $6,850 limit.

Hospital Stays

Most plans have some form of cost-sharing that applies when you enter the hospital as an inpatient. This can be confusing because of the interaction between the cost-sharing for the hospitalization and any general medical deductible the plan has. Some plans are fairly clear about meeting the general medical deductible before any costs for a hospitalization are covered, after which you may have no additional cost-sharing or may have to pay a coinsurance percentage above the deductible amount.

Other plan structures to look for:

  • Some plans are more complicated and choose not apply the general medical deductible to inpatient hospital stays, but have a separate deductible or copayment applying to the hospital stay. A copayment may be assessed once on admission or for each day of the stay, typically up to a maximum number of days. After reaching the stated maximum, you are often responsible for paying a portion of the additional costs above a separate deductible or copayment, usually in the form of coinsurance.
  • In addition, there are plans that only apply a coinsurance percentage to inpatient hospital stays.
  • Most plans require you to pay cost sharing when visiting a physician’s office, other than certain preventive care visits where cost-sharing is not allowed. They will also require a copayment when you have a primary doctor or specialist office visit. You will see the use of coinsurance more in the bronze plans category (28%) than in the other metal levels.
  • Many plans require meeting the general medical deductible before any payment is made for your office visits.
  • Some plans will pay toward a small number of office visits before you meet the general medical deductible, and don’t make payments towards additional office visits until after that deductible has been met.
  • Many of these plans require you to pay a copayment toward the cost of a certain number of covered visits before the deductible has been met, and to pay coinsurance towards the cost of visits that occur after the deductible has been met.

Emergency Room

Emergency room visits work in much the same way as the cost-sharing for inpatient hospital stays. Plans can use either a copayment or coinsurance, and might not begin paying until the general medical deductible has been satisfied. Other plans have both a copayment and coinsurance for an emergency room visit. The general medical deductible may or may not apply, but you must pay a specified copayment, and then coinsurance for a portion of the costs above the copayment.

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Pre-Existing Conditions Clause

Health insurance companies are no longer allowed refuse to cover you or charge you more just because you have a pre-existing condition. This is a prior, diagnosed or current medical condition you have before your health coverage begins. They also can’t charge women more than men.

Health insurers can’t charge more or deny coverage to you or your child because of a pre-existing health condition like asthma, diabetes, or cancer. They can’t limit your benefits for that condition. Once you have insurance, they must cover treatment for these conditions.

Section 1557, of the ACA law prohibits discrimination, by any health program or activity receiving federal funds, on the ground of race, color, national origin, sex, age, or disability.

Any plans that are not certified by ACA are still able to use pre-existing conditions to determine rates, coverage, and possible denial of coverage.

Pre-existing conditions rules apply to grandfathered plans prior to 3/23/2010.

Learn more about discrimination and Section 1557

Learn more about Grandfathered Health Plans and Pre-existing Conditions

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Marketplace “Metal” Categories and Cost-Sharing

The cost-sharing options are determined by selecting a Bronze, Silver, Gold, or Platinum policy plan. Even though they are meant to be structured the same within each metal category, they will vary within the guidelines given by law on how they distribute the cost-sharing with deductibles, copays, and coinsurance. You need to pick the one that suits you best economically.

Average medical and drug deductible for 2016 Healthcare.gov plans are shown here:

  • Bronze = $5,765,
  • Silver = $3,064,
  • Gold =$1,247,
  • Platinum =$21

Premium changes in 50 ACA plans in 50 major cities from 2015 to 2016 increased an average of 3.6%. Annual premium increases are common in insurance to keep up with costs of medical expenses.

9

Americans Still Struggle With Some Health Insurance Basics
  1. When asked what insurance premiums are: 76% of Americans answered this question correctly.
  2. When asked if they pay premiums monthly or only when they use their coverage: 79% of Americans answered this question correctly.
  3. When asked the definition of Annual Deductible and the concept of cost-sharing: 72% of Americans answered this question correctly.
  4. When asked how to calculate a balance owed after applying the deductible plus co-pay in a simple math problem: 51% of Americans answered this question correctly.
  5. When asked the definition of Annual Out-of-Pocket costs: 67% of Americans answered this question correctly.
  6. When asked the definition of a Formulary: 33% of Americans answered this question correctly.
  7. When asked the definition of a Provider Network: 76% of Americans answered this question correctly.
  8. When asked if all doctors providing your care in your hospital actually work there. 41% of Americans answered this question correctly.
  9. When asked to calculate Out-of-Network costs: 16% of Americans answered this question correctly.
  10. When asked if you can formally appeal a dispute regarding a health plan charge: 68% of Americans answered this question correctly.

Take the Quiz Here to See How Well You Understand Health Insurance

10

Children and Young Adults

How we qualify for plans can depend on our age group as well as economic circumstances. Our first opportunity to become insured will likely be through our parent’s.

Under the Affordable Care Act, if your individual or job-based plan covers children, you can now add or keep your children on your health insurance policy until they turn age 26. Before the new health care law, insurance companies could remove children from policies at age 19, extending it only for full-time students. Now, most health plans that cover children must make coverage available to them until they are older to make it easier and more affordable for these young adults to get their own coverage.

Until age 26 they can join or remain on a parent’s plan under the following circumstances as well:

  • Married
  • Not living with their parents
  • Attending school
  • Not financially dependent on their parents
  • Eligible to enroll in their employer’s plan

If you are a young adult on your parent’s Employer-Based plan and having a 26th birthday, you immediately qualify for Special Enrollment for individual healthcare purchases outside of the Open Enrollment period. Check with the plan or the employer’s company to find out exactly when the coverage ends. Your Special Enrollment Period starts 60 days before your birthday and ends 60 days after, giving you time to shop around. If you enroll before your 26th birthday, coverage can start as soon as the first day of the month you lose coverage. If you enroll during the 60 days after your birthday, coverage can start the first day of the month after you pick a plan.

If you are covered on your parent’s Marketplace plan on your 26th birthday, you can stay on your parent’s policy until the plan year ends on December 31. On January 1st during Open Enrollment you may qualify for premium tax credits and other savings based on your income. If you’re just starting your career and not making much money, you could get a very affordable plan – maybe $75 or less per month, with good benefits.

If you are still tax dependent you will not qualify for the tax credit or savings and will pay full price.

To do a Quick Check and see if you’ll save on health insurance, click here

11

Students

Most student health plans are qualified ACA plans, but be sure to check with the school. If you’re enrolled in a student health plan, in most cases it qualifies as minimum essential coverage.

This means you’re considered covered under the health care law, and won’t have to pay the penalty for not having insurance. Even if you have access to a student health plan, you can apply for coverage through the Health Insurance Marketplace instead.

When you apply, you’ll find out if you qualify for an insurance plan with savings based on your income, or for free or low-cost care through Medicaid or the Children’s Health Insurance Program (CHIP).

Reminder: If someone claims you as a tax dependent, you can buy an insurance plan through the Marketplace but won’t qualify for savings based on your income.

Learn about the benefits of applying through the Marketplace and determine your next steps.

Student Tip: If you have a student health plan at that time you are filling out a Marketplace plan application, pick “NO” for the questions regarding current student coverage and plan to drop it when the Marketplace plan begins.

Students who don’t have health insurance may have to pay a fee. There’s no special student exception to the requirement to have health insurance.

12

Ages 26 to 30 under the Affordable Care Act

If you’ve looked at the Health Insurance Marketplace and determined you can’t afford coverage and don’t qualify for eligible savings based on income, you might want to look at Catastrophic Health plans.

Catastrophic Health Plans protect you from worst-case scenarios like serious illness or injury. You pay most routine medical expenses yourself. Catastrophic health insurance plans have low monthly premiums because they have a very high deductible. The current deductible amount is $6,850. Due to the lower premium, you will not qualify for a tax credit to reduce your monthly cost for a catastrophic plan.

Catastrophic plans cover less than 60% of your total costs of care. You will pay more than 40%.

If you know you qualify for a premium tax credit based on your income for Bronze or Silver plans, they could be a better value. Be sure to compare.

The Hardship Exemption

Only people under 30, and people of any age with a hardship exemption, are protected from penalty by not complying with the requirement to have health insurance.

  • Catastrophic plans cover 3 primary care visits per year, and certain preventive services, at no cost. You pay all other medical costs yourself until reaching your deductible of $6,850 for the plan year 2016. The plan then pays 100% of covered services.
  • If you’re eligible to buy a catastrophic plan, you’ll find them in the Marketplace.

Learn more about Catastrophic plans

Hardship exemption qualifications are listed below. You can use the Exemptions Tool, located on the Healthcare.gov website, to find specific forms and instructions.

  1. Youwere homeless
  2. You were evicted in the past 6 months or facing eviction or foreclosure
  3. Youreceived a shut-off notice from a utility company
  4. You recently experienced domestic violence
  5. You recently experienced the death of a close family member
  6. Youexperienced a fire, flood, or other natural or human-caused disaster causing substantial damage to your property
  7. Youfiled for bankruptcy in the last 6 months
  8. You had medical expenses you couldn’t pay in the last 24 months and they resulted in significant debt
  9. You took on unexpected increases in necessary expenses due to caring for an ill, disabled, or aging family member
  10. An eligibility appeals decision determined your eligibility for enrollment in a qualified health plan (QHP) through the Marketplace, lowering costs on your monthly premiums, or allowing cost-sharing reductions for a time period when you weren’t enrolled in a QHP through the Marketplace
  11. You were determined ineligible for Medicaid because your state didn’t expand eligibility for Medicaidunder the Affordable Care Act
  12. Your individual insurance plan was canceled and you believe other Marketplace plans are unaffordable

To apply for an exemption from the shared responsibility payment for these reasons or another reason you might have, get the Exemption Form here.

Hardship exemptions usually cover the month before the hardship, the months of the hardship, and the month after the hardship. But in some cases the Marketplace may provide the exemption for additional months, including up to a full calendar year under the following conditions:

  • For people ineligible for Medicaid only because a state hasn’t expanded Medicaid coverage, the hardship exemption will be granted for the whole calendar year.
  • For people eligible for Indian Health Services, the hardship exemption lasts as long as you remain eligible.
  • For people under 21 who are eligible for an exemption due to religious conscience, you’ll need to reapply if you remain a member when you turn 21.

There’s no hardship exemption based only on employment status. But several health coverage exemptions apply to people with very little income or no income at all. If you’re granted a hardship exemption, the notice includes information on catastrophic health plans. With a hardship exemption, you can buy a catastrophic plan regardless of age or income. A catastrophic plan offers low-cost coverage that protects you from high medical costs when seriously hurt or injured. To buy catastrophic coverage with a hardship, you’ll need to give your Exemption Certificate Number (ECN) to the insurance company selling the plan.

Find out about ECN here.

Learn more about Catastrophic plans

  • Note: If you get a hardship exemption, you don’t  have to buy a catastrophic plan. It’s just an option available to you.
  • If you’re single or have a pretty straightforward family situation, applying and finding out what savings you qualify for can be quick and easy.

Reminder: If someone claims you as a tax dependent, buying a plan through the Marketplace won’t qualify you for savings based on your income.

13

Women’s Health Insurance

Women’s issues are another critical factor in making health insurance affordable for everyone. Among the 97.5 million women ages 19 to 64 residing in the U.S., most had some form of coverage in 2014. However, Medicaid coverage gaps in the private-sector and publicly-funded programs left almost one in eight women uninsured.

One of the Affordable Care Act’s (ACA’s) primary goals was to expand access to insurance coverage to reduce the number of uninsured. The law requires that nearly everyone carry health insurance, and expands access to coverage through a combination of Medicaid expansions, private insurance reforms, and premium tax credits. There will need to be more changes to impact the law on women’s coverage in the future.

Approximately 57 million women ages 19-64 (58%) received their health coverage from their own or their spouse’s employer in 2014. Women are less likely than men to be insured through their own job (34% vs. 43% respectively) and more likely to be covered as a dependent (24% vs. 16%).

There has been a sharp drop in the number of women without coverage since the ACA was passed, yet 12.8 million women remain uninsured. More than a quarter (29%) of women remaining uninsured are not eligible for assistance under the ACA because they are undocumented (16%) or they fall into the Medicaid coverage gap (13%) created by their state’s decision not to expand Medicaid. These 3.6 million women lack a pathway to affordable insurance coverage.

However, about a fifth of uninsured women are eligible for Medicaid but not enrolled and another quarter is income eligible for a subsidized Marketplace plan. About a quarter (26%) of uninsured women are not eligible for assistance under the ACA because they have an offer of employer-based insurance or have incomes above the levels for subsidies in the Marketplace.  Further education about coverage options might help to reach uninsured women, it may not be enough to convince some to get insured.  Cost is the leading reason that uninsured women report for remaining uninsured.

The Effect of ACA Law on Women’s Plans

The ACA also sets new standards for benefits offered in private plans. It requires that new private plans cover preventive services without co-payments or other cost sharing. This includes pap tests, mammograms, bone density tests, as well as the HPV vaccine. As of August 2012, new private plans were required to cover an additional set of preventive services for women, including prescribed contraceptives, breastfeeding supplies and supports such as breast pumps, screening for domestic violence, well-woman visits, and several counseling and screening services.  Abortion services are explicitly excluded from being included and 25 states have laws banning coverage of most abortions from the plans available through the state Marketplaces.

Women have unique, and often costly, health and medical needs and some of these are finally being addressed by the ACA law. They include:

  • Prenatal care and delivery Essential to the health of both mother and baby, it is very expensive with an average cost of over $20,000 in 2011 for an uncomplicated birth.Currently, costs vary greatly depending on what hospital you use.
  • The Affordable Care Actbans annual dollar limits on essential health benefits in all job-related plans and individual health insurance plans, lifetime limits on most benefits are prohibited in any health plan or insurance policy.
  • Private plans in the Health Insurance Marketplace, as well as most individual and small group plans outside the Marketplace are now required to cover 10 essential health benefits categories, including maternity and newborn care.
  • The Affordable Care Act also now requires most health plans to cover additional preventive serviceswith no cost-sharing, such as well-woman visits, screening for gestational diabetes, domestic violence screening, breastfeeding supplies and contraceptive services.

Twenty-Two Covered Preventive Services for Women and Pregnant Women

Maternity care and childbirth — services provided before and after a child is born — are essential health benefits. This means all qualified health plans inside and outside the Marketplace must cover them even if they were pregnant before their coverage started due to the elimination of pre-existing conditions.

  1. Anemia screening on a routine basis for pregnant women
  2. Bacteriuria urinary tract or other infection screening for pregnant women
  3. BRCA counseling about genetic testing for women at higher risk
  4. Breast Cancer Mammography screenings every 1 to 2 years for women over 40
  5. Breast Cancer Chemoprevention counseling for women at higher risk
  6. Breastfeeding comprehensive support and counseling from trained providers, as well as access to breastfeeding supplies, for pregnant and nursing women
  7. Cervical Cancer screening for sexually active women
  8. Chlamydia Infection screening for younger women and other women at higher risk
  9. Contraception Food and Drug Administration-approved contraceptive methods, sterilization procedures, and patient education and counseling, not including abortifacient drugs
  10. Domestic and interpersonal violence screening and counseling for all women
  11. Folic Acid supplements for women who may become pregnant
  12. Gestational diabetes screening for women 24 to 28 weeks pregnant and those at high risk of developing gestational diabetes
  13. Gonorrhea screening for all women at higher risk
  14. Hepatitis B screening for pregnant women at their first prenatal visit
  15. Human Immunodeficiency Virus (HIV) screening and counseling for sexually active women
  16. Human Papillomavirus (HPV) DNA Test  high-risk HPV DNA testing every three years for women with normal cytology results who are 30 or older
  17. Osteoporosis screening for women over age 60 depending on risk factors
  18. Rh Incompatibility screening for all pregnant women and follow-up testing for women at higher risk
  19. Tobacco Use screening and interventions for all women, and expanded counseling for pregnant tobacco users
  20. Sexually Transmitted Infections (STI) counseling for sexually active women
  21. Syphilis screening for all pregnant women or other women at increased risk
  22. Well-woman visits to obtain recommended preventive services

More Information about the Affordable Care Act, Maternity Coverage and Preventive Care

More coverage without cost-sharing requirements include:

  • Breastfeeding support, supplies, and counseling:  Breastfeeding is one of the most effective preventive measures mothers can take to protect their health and that of their children, according to the Centers for Disease Control and Prevention (CDC). The Affordable Care Act requires most health insurance plans to cover the cost of a breast pump as part of women’s preventative health services. These rules apply to Health Insurance Marketplace plans, and all other private health insurance plans, except for grandfathered plans.
  • Gestational diabetes screening: This screening is for women 24 to 28 weeks pregnant, and those at high risk of developing gestational diabetes. Women who have gestational diabetes have an increased risk of developing type 2 diabetes in the future. Children of women with gestational diabetes are at significantly increased risk of being overweight and insulin-resistant throughout childhood.
  • Break Time for Nursing Mothers

The Affordable Care Act amended the Fair Labor Standards Act (FLSA), covering most hourly wage earning and some salaried employees. Many employers are required to do the following:

  • Workers must be given “reasonable” break time to pump for a breastfeeding child, as frequently as needed by the nursing mother, for up to 1 year after the child’s birth.
  • Women who need to pump or nurse must be given a private space. This space cannot be a bathroom.

Learn more about having a healthy pregnancy.

Millions of women have gained coverage in the first three years of ACA implementation. As the fourth year of the ACA expansion gets started, it may become harder to continue reducing the number of uninsured.  Also, Medicaid expansion needs to be resolved as well as the issue of undocumented immigrants; another group of uninsured women.

The state-federal program for low-income individuals, Medicaid, covered 16% of non-elderly women in 2014. Historically, to qualify for Medicaid, women had to have very low incomes and be in one of Medicaid’s eligibility categories:  pregnant, mothers of children 18 and younger, disabled, or over 65.  Women who didn’t fall into these categories typically were not eligible regardless of how poor they were.

14

Retirees under Age 65

If you retire before you’re 65 and lose your job-based health plan, you can use the Health Insurance Marketplace to buy a plan. You will qualify for a Special Enrollment Period enabling you can enroll in a health plan even if it’s outside the annual Open Enrollment Period. You will need a letter from your previous employer stating your circumstances to include with your application.

Learn more about Special Enrollment Periods on this page

When you fill out a Marketplace application, you’ll find out if you qualify for premium tax credits and lower out-of-pocket costs depending on your income and household size. You’ll also find out if you qualify for free or low-cost coverage through the Medicaid program in your state.

If you still have your Job-Based retiree health benefits

If you have retiree health benefits, you’re considered covered under the health care law. You don’t have to pay the penalty that people without insurance must pay.

If you are eligible for, but not enrolled in retiree coverage, you may qualify for premium tax credits and lower out-of-pocket costs based on your household size and income on the Marketplace.

If you have retiree coverage and want to buy a Marketplace plan instead, you can.

But:

  • You can’t get premium tax credits and other savings based on your income.
  • If you voluntarily drop your retiree coverage, youwon’t qualify for a Special Enrollment Period to enroll in a new Marketplace plan. You won’t be able to enroll in health coverage through the Marketplace until the next Open Enrollment period. Don’t leave yourself without coverage. Check the policy or talk to your employer to be certain of the dates your current coverage expires versus the dates of Open Enrollment from November 1st through January 31st.

Some employers may provide retired employees with access to an account, called a Health Reimbursement Arrangement (HRA), which the retiree may use to reimburse medical expenses, including an individual policy through a Marketplace or in the non-group market. A retiree that signs up for an HRA offered by a former employer is considered to have minimum essential coverage from an employer and would therefore not be eligible to claim a premium tax credit if enrolling in a Marketplace plan.

Other considerations:

  • Social Security benefits are counted as income in determining eligibility for premium tax credits in the Marketplace.
  • VA disability pension benefits generally are not subject to federal income tax and so are not counted as income in determining eligibility for premium tax credits.

Remember, outside of Open Enrollment, you cannot voluntarily drop your retiree coverage and replace it with other Marketplace coverage.

15

Retired, 65 and Over, and Medicare

Medicare is for primarily for people over 65, or who qualify through disability and are unable to work. It is comprised of 4 Parts.

  • Part A is hospitalization coverage for major medical issues.
  • Part B is for doctor visits and outpatient services *(you can’t get B unless you’ve qualified for Part A first)
  • Part C combines A and B into Medicare Advantage plans using network systems like HMOs and PPOs, often including prescription coverage (review the plan, ask your agent, or speak with a navigation assistant online).
  • Part D is prescription coverage that stands alone or is added to Parts A and B.

Medicare plans are ACA certified *(except for Part B by itself). Medicare is a government subsidized program while Medicare Supplement Insurance plans are not. You can also purchase qualified Medicare Supplement Plans from independent agents or directly from Insurance Companies.

Determining which of these plans works best for you is the same as figuring out plans on the Marketplace. Information is available to enroll online directly, but if you want more clarification on the products, it is good to know you can speak face to face with an agent or talk on the phone with one. Insurance agents have to pass numerous requirements with state health insurance licensing programs.

Government ACA and AHIP (Americas Health Insurance Plans) certification is required. AHIP is an advocacy group and a National Organization comprised of 1300 health insurance carrier members. Individual health insurance companies also require agents to complete additional courses in order to sell their products. Regulations are very strict for health insurance in this age category regarding misrepresentation of products and unnecessary replacement of current coverage.

Both Medicare and Medicare Supplement are very complex in the way they fit together to provide total coverage. It is worth the time and energy to fully understand it before committing to a purchase.

Plans for Medicare Supplement Insurance are described alphabetically A through F. Plan A is the most basic while plan F affords the most coverage. There are still some grandfathered plans out there that are no longer available for purchase, but still in existence until or unless, the policy owner decides to cancel. All plans are designed to plug the coverage gaps in Medicare plans by covering deductibles, copays, and co-insurance. They raise coverage limits in certain areas like in-home and hospice care, often adding a few extra features, like some coverage for travel that Medicare doesn’t offer.

You cannot buy a Medicare Supplement if you are not qualified for Medicare first. They are often confused by the general public because they both identify plans with letters and both use the word Medicare. Social Security funds Medicare, and forms and information are available at your local social security administration and post office buildings.

A few other important things to know about plans for those 65 and over:

  • Open Enrollment for Medicare is October 15, 2015, to December 7, so it will overlap the enrollment period for the Health Insurance Marketplace ACA enrollment period.
  • Medicare Supplements are available to purchase all year long. When replacing a Medicare Advantage Part C Plan with a Medicare Supplement policy, be sure to coincide the dates with the Medicare Advantage Enrollment Period to avoid a lapse in coverage.
  • Pre-existing condition clauses are still considered unless you have just turned age 65 or have a Special Enrollment qualification (your current carrier no longer provides service in your area or you are losing a job-based plan). Therefore, a lapse in coverage could cause a great problem if you have a health condition to consider.

More information regarding Medicare Supplement (Medigap) versus Medicare and Medicare Advantage

Things specific to Medicare Supplement (Medigap) Plans:

  1. You must have Medicare Part A and Part B.
  2. If you have a Medicare Advantage Plan, you can apply for a Medicare Supplement policy, but make sure you can leave the Medicare Advantage Plan before your Medicare Supplement policy begins to avoid a lapse in coverage.
  3. You pay the private insurance company a monthly premium for your Medicare Supplement policy in addition to the monthly Part B premium that you pay to Medicare.
  4. A Medicare Supplement policy only covers one person. If you and your spouse both want Medicare Supplement coverage, you’ll each have to buy separate policies.
  5. You can buy a Medicare Supplement policy from any insurance company that’s licensed in your state to sell one.
  6. Any standardized Medicare Supplement policy is guaranteed renewable even if you have health problems. This means the insurance company can’t cancel your Medicare Supplement policy as long as you pay the premium.
  7. Some Medicare Supplement policies sold in the past cover prescription drugs, but Medicare Supplement policies sold after January 1, 2006, aren’t allowed to include prescription drug coverage. If you want prescription drug coverage, you can join a Medicare Prescription Drug Plan. It’s illegal for anyone to sell you a Medicare Supplement policy if you have a Medicare Medical Savings Account (MSA) Plan.

Learn how to get Medicare Part D Prescription Coverage

Medicare MSA Plans

Medicare MSA Plans combine a high-deductible insurance plan with a medical savings account that you can use to pay for your health care costs.

  1. High-deductible health plan: The first part is a special type of high-deductibleMedicare Advantage Plan (Part C). The plan will only begin to cover your costs once you meet a high yearly deductible, which varies by plan.
  1. Medical Savings Account (MSA): The second part is a special type of savings account. The Medicare MSA Plan deposits money into your account. You can choose to use money from this savings account to pay your health care costs before you meet the deductible.

Learn more about the Medicare Savings Account (MSA) Plan.

Not Covered by Medicare Supplement (Medigap)

Medicare Supplement policies generally don’t cover long-term care, vision or dental care, hearing aids, eyeglasses, or private-duty nursing.

Insurance Plans That Are Not Medicare Supplement (Medigap)

Some types of insurance are not Medicare Supplement plans, they include:

  • Medicare Advantage Plans or Medicare Part C Plans (Medicare provider network plans like HMO, PPO, POS, or Private Fee-for-Service Plan)
  • Medicare Prescription Drug Plans or Part D Plan
  • Medicaid
  • Employer or union plans, including the Federal Employees Health Benefits Program (FEHBP)
  • TRICARE
  • Veterans’ benefits
  • Long-term care insurance policies

Indian Health Service, Tribal, and Urban Indian Health plans

16

Medicare Supplement Affects Drug Coverage

If you decide to drop your entire Medicare Supplement policy, you need to be careful about the timing, not just because of a lapse in coverage, but also if there is a prescription drug plan on its own or a drug plan attached to the new policy.

If you drop your entire Medicare Supplement policy and the drug coverage wasn’t a creditable prescription drug coverage or you go 63 days or more in a row before your new Medicare drug coverage begins, you have to pay a late enrollment penalty when you join a new Medicare drug plan. This penalty calculates 1 percent of the national average prescription drug premium ($34.10 for 2016) multiplied by the number months you did not have coverage and adds it to your Part D premium. The amount changes annually along with changes to the national average premium.

More information

Learn where to find a Medicare Supplement (Medigap) Policy

Learn how (SHIP) can help during Medicare’s Open Enrollment Period.

Other Helpful Contacts in Your State

17

Medicaid

Medicaid provides coverage for some low-income people, families and children, pregnant women, the elderly, and people with disabilities. It is also a qualified ACA plan except for limited coverage plans. In some states, Medicaid has been expanded to cover all adults below a certain income level.

Learn more about Medicaid expansion in your state and what it means for you.

  • Medicaid programs must follow federal guidelines, but coverage and costs may be different from state to state. Each state works closely with its state Medicaid program.
  • Some Medicaid programs pay for your care directly while others use private insurance companies to provide Medicaid coverage.

Children’s Health Insurance Program (CHIP) provides low-cost health coverage to children in families that earn too much money to qualify for Medicaid. In some states, CHIP covers parents and pregnant women.

  • In many cases, if you qualify for Medicaid your children will qualify for either Medicaid or Chip.
  • You can enroll in Medicaid or CHIP any time of the year. They do not have an enrollment period.
  • If you qualify, coverage starts immediately.
  • Coverage includes routine check-ups, immunizations, doctor visits, prescriptions, dental and vision care, inpatient and outpatient hospital care, laboratory and x-ray services, and emergency services.

Learn more about Medicaid and Chip for Children’s Health Insurance.

The Coverage Gap Explained

When the Supreme Court ruled that states had the choice of opting out of the Obamacare’s Medicaid expansion in 2012, expansion advocates predicted a terrible outcome for anyone caught in the Coverage Gap. The coverage gap refers to the segment of the adult population living in poverty but with incomes that make them ineligible for Medicaid because their state didn’t expand Medicaid coverage. Incredibly these individuals have incomes too low for them to receive the subsidized comprehensive coverage provided by the Affordable Care Act on the Health Insurance Marketplace. One of the few options left to them is the Short Term plan.

Learn more about the coverage gap and if it affects you.

18

Short Term Plans

Short-term policies have been around for a long time, and have traditionally been a good option for people who are between jobs or waiting for a new employer’s coverage to become effective. These policies are not regulated by the Affordable Care Act like regular Major Medical plans, and their sale is not limited to open enrollment periods. However, by not having to follow ACA regulation, there is no special enrollment privilege when the short- term policy ends that allows you to then enroll in a qualified plan on the marketplace. You still need to wait until regular enrollment.

People in the coverage gap, who need coverage for just a few months before another policy begins, or consumers who missed open enrollment and were looking for a more traditional major medical plan may choose this plan.

A short-term policy will provide you with up to six months of coverage in most states. They do not renew and have to be reapplied for each time, exposing you to underwriting requirements for age and pre-existing conditions.

With short-term policies, healthy applicants can secure immediate individual and family coverage, with plans that can kick in as early as the next day. If you already know the number of days you will need to be covered, your insurer may allow you to make a single payment for the whole coverage period.

Short-term plans are typically offered with a selection of premiums, deductibles and benefit maximums. The policies are considerably less expensive than ACA-compliant major medical plans, so you may find that you can afford to purchase a plan with a low deductible and a high-benefit maximum.

The policies also cover a range of physician services, surgery, outpatient and inpatient care. In addition, policy-holders can often choose their own doctor and hospital, but may pay more for services out of network. They generally do not cover routine office visits, maternity, mental health or preventative care so check out the list of exclusions.

If you’re healthy and in need of temporary coverage until another plan starts, or if you missed the last open enrollment and need coverage just for the rest of the year, a short-term major medical plan may be right for you. Don’t forget to then enroll in a regular plan once open enrollment begins, so that you’ll have ACA-compliant coverage effective January 1.

Short-term major medical may not be available in all 50 states.

19

Alaska and Indian Natives

Special Marketplace protections and benefits are available for American Indians and Alaska Natives. American Indian and Alaska Natives may have new health coverage benefits and protections in the Marketplace.

Some benefits are available to members of federally recognized tribes or Alaska Native Claims Settlement Act (ANCSA) Corporation shareholders.

  • If you buy private insurance in the Health Insurance Marketplace and your income is between $24,250 and $72,750 for a family of 4 ($30,320 to $90,960 in Alaska) and you qualify for premium tax credits, you are eligible for azero cost sharing plan and won’t pay out-of-pocket costs like deductibles, copayments, and coinsurance for health care.
  • If your income is below $24,250 or above $72,750 for a family of 4 (or below $30,320 or above $90,960 in Alaska), you are eligible for alimited cost sharing plan and won’t pay out-of-pocket costs when you get services from an Indian health care provider or from another provider if you have a referral from an Indian health care provider.
  • Members of federally recognized tribes and ANCSA shareholders can enroll in Marketplace plans any time of year. Enrollment period does not apply to these individuals and they can also make plan changes as often as once a month.
  • If you don’t have health insurance, you are eligible for an exemption from paying the fee, and only need to claim the exemption when you file your federal income tax return or fill out an exemption application and mail it to the Marketplace.

Learn how to apply for the exemption for American Indians and Alaska Natives.

Others people who may have new health coverage benefits are those of Indian descent and eligible for services from the Indian Health Service, a tribal program, or an urban Indian health program.

This coverage can be through a private health plan bought in the Marketplace, Medicaid, or the Children’s Health Insurance Program (CHIP). You have special cost and eligibility rules for Medicaid and the Children’s Health Insurance Program (CHIP) to make it easier to qualify.

  • If you get a marketplace plan you can get (or keep) services from the Indian Health Service, tribal health programs, or urban Indian health programs.

Learn more about your local Indian health benefits from Indian Health Services.

Learn more about your local Indian health benefits from Tribal Healthcare.

20

Unemployed

If you’re unemployed you may be able to get an affordable health insurance plan through the Marketplace, with savings based on your income and household size. You may also qualify for free or low-cost coverage through Medicaid or the Children’s Health Insurance Program (CHIP).

Your household size and income, not your employment status, determine what health coverage you’re eligible for and how much help you’ll get paying for coverage.

If you have just left your job for any reason and lost your job-based health coverage, you qualify for a Special Enrollment Period. This means you can enroll in a Marketplace insurance plan any time of year. You usually have 60 days from the day you lose your coverage to enroll.

Learn how to apply for a Special Enrollment Period.

There is no limited enrollment period for Medicaid or CHIP. If you qualify, you can enroll in these programs any time of year. You’ll find out if you qualify when you fill out your Marketplace application.

It’s hard to predict your annual income if you’re unemployed. Still, it’s important to make your best estimate based on all current or expected sources of income for the year.

Types of income to include on your application:

  • Unemployment compensation
  • All household members’ income (not just yours)
  • Additional types of income, including interest income, capital gains, cash support, and alimony
  • Most withdrawals from traditional IRAs and 401ks.

For information on non-deductible contributions see this PDF for IRS Form 8606 instructions.

For information on Roth accounts see this PDF for IRS Publication 590-B.

Note: It’s very important to immediately update your income information with the Marketplace if your income changes during the year. This will ensure you get the right amount of savings based on your new annual income estimate.

Report any income changes here.

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Consolidated Omnibus Budget Reconciliation Act (COBRA)

(COBRA) is an ACA qualified plan. It’s a federal law telling employers and self-insured employers, with more than 20 employees, that they must offer to provide continuation of group insurance coverage to workers after they leave employment. This coverage is fairly expensive once the employer is no longer making the contribution to premiums. It is a less expensive option to get an individual policy through the marketplace before the price adjustment is made.

Only 10% of Americans eligible for COBRA insurance in 2006 used it, many because they were unable to afford to pay the full premium after their job loss. While some employers may voluntarily help subsidize or fully cover the cost of COBRA insurance as part of a termination or exit package, it is more common for the ex-employee to cover the entire cost.

The American Recovery and Reinvestment Act of 2009 signed by President Barack Obama includes a 65% subsidy to employees for COBRA-enabled insurance for up to 9 months after an involuntary termination (this has since been expanded to 15 months). An employee is eligible for this subsidy if:

  • the termination of employment was involuntary
  • the terminated employee has no other group sponsored health insurance option
  • the terminated employee is otherwise eligible to enroll in COBRA

Employers subject to Federal COBRA are required to:

  • Notify terminated employees of their potential rights under ARRA
  • Provide a method for qualified employees to enroll
  • Pay the full amount of the premiums and seek reimbursement of the 65% subsidy by including it in the Employer’s Quarterly Federal Tax Return (Form 941)

During Open Enrollment, you can sign up for a Marketplace plan even if you already have COBRA. You will have to drop your COBRA coverage effective on the date your new Marketplace plan coverage begins. Once open enrollment is over, however, if you voluntarily drop your COBRA coverage or stop paying premiums, you will not be eligible for a special enrollment opportunity and will have to wait for the next Open Enrollment period. Only exhaustion of your COBRA coverage triggers a special enrollment opportunity.

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Military and Other Agency or Organizations

There are several Military, Federal or Government Agencies and Organizations with ACA qualified plans. Once leaving these agencies and organizations, there is a period of special enrollment in order to make changes in coverage. Visit each site in order to understand the details of how coverage works during and after service.

TriCare

TriCare plans are also ACA qualified plans. They are Military Plans for both in service and retired.

Exceptions to qualified minimum essential are circumstances that do not call for direct care are described below:

  • Dependent-parents and parents-in-law
  • Guard/Reserve members getting Line of Duty care
  • Service Secretarial Designees

More information regarding Tricare

Call the Health Insurance Marketplace

1-800-318-2596

Multi-State Plans

The multi-state plan program was established under the Affordable Care Act to provide people with additional coverage options in the health insurance Marketplace. A multi-state plan is one that has been approved to participate on the health insurance Marketplace by a federal government agency, the U.S. Office of Personnel Management. This is the same agency that administers the health plan for federal government employees.

Multi-state plans may only be sold through the health insurance Marketplace.

In 2016, there will be multi-state plans in 33 states including the District of Columbia, but by 2017 the law requires that all 50 states have multi-state plans.

Veterans

Veteran’s plans are ACA qualified. The health care law does not change your VA health care benefits. Certified plans by the Health Insurance Marketplace provide essential benefits, limits on cost-sharing (deductibles, copay, out of pocket maximums. Individual plans prior to 3/23/2010 are grandfathered as certified.

You can continue to enjoy VA health care, which means you have:

  • Medical care rated among the best in the U.S.
  • Immediate benefits of health care coverage. Veterans may apply for VA health care enrollment at any time.
  • No enrollment fee, monthly premiums, or deductibles. Most Veterans have no out-of-pocket costs. Some Veterans may have to pay small copayments for health care or prescription drugs.
  • More than 1,500 places available to get your care. This means your coverage can go with you if you travel or move.
  • Meets the requirement to have health care coverage that meets the minimum standard.

For more information about types of veteran health plans, coverage, and benefits, visit the Department of Veterans Affairs website. You can call The Department of Veterans Affairs at 1-877-222-VETS (8387) Monday through Friday from 8 a.m. until 8 p.m. EST.

If you have other forms of health care coverage, such as a private insurance plan, Medicare, Medicaid or TRICARE, you can continue to use VA along with these plans.

Remember: Inform your doctors if you are receiving care outside of VA so your health care can be coordinated.

If you choose to cancel your VA health care enrollment, you may reapply for enrollment at any time; however, acceptance for future VA health care enrollment will be based on eligibility factors at the time of application taking things like age and medical history into consideration.

AmeriCorps Vista Healthcare Allowance

AmeriCorps VISTA is the national service program that works to eliminate poverty. AmeriCorps VISTA is a program of Corporation for National Community Service (CNCS), the federal agency that improves lives, strengthens communities, and fosters civic engagement through service and volunteering.

Vista offers supplemental insurance and is not a health insurance policy so it does not meet the requirements of the Affordable Care Act. There are 2 products.

The AmeriCorps VISTA Healthcare Allowance is a supplemental reimbursement program that help to share costs incurred by health insurance coverage. It offsets the out-of-pocket expenses like deductibles, coinsurance, and co-payments up to $6,600. Alone it is not an insurance policy or program. The coverage can only be used for the Vista member and does not cover costs for spouses or children or non-essential health benefits. It does not cover the cost of premium payments.

AmeriCorps VISTA offers a Healthcare Allowance for AmeriCorps VISTA members who maintain their own health coverage for the duration of their service year.

  • If you are 26 or younger and on a parent’s plan, or married and covered by a spouse’s plan, you may continue this coverage during your term of service.
  • Healthcare coverage purchased through the ACA Health Insurance Marketplace. For more information, to check on exemption status, or to enroll in an ACA compliant plan, please visit Healthcare.gov.
  • If you have Medicaid or Medicare, or military healthcare benefits or are eligible for these benefits, you may still receive them during service.

The AmeriCorps VISTA Health Benefit Plan is a self-funded, basic health benefits plan for members who demonstrate that they are legally exempt from having ACA-compliant coverage during their term of service. VISTA also offers a basic Health Benefit Plan to members who are exempt from the ACA’s requirement to maintain health coverage for the duration of their service year. Qualifications are as follows:

  • Members who are covered under the Health Benefit Plan prior to 01/01/2015 may elect to remain on the self-funded basic health benefits plan. Review the details of the plan for your best option. If you have other coverage, the Health Plan Allowance may be a better option.
  • Any member who qualifies for a Hardship exemption.
  • Members who have a Tribal Membership or members living in any of the U.S. Territories.

Coverage for full-time members is not ACA compliant. There are no employees, only members. Organizations affiliated with AmeriCorps include: Head Start, Upward Bound, the credit union system, Habitat for Humanity, and Neighborhood Watch

Get more information on health benefit options.

Peace Corp Volunteers

Peace Corps Volunteers have ACA certified plans. The Peace Corps volunteers and returned Peace Corps volunteers have new options for quality, affordable health care after their service through the Affordable Care Act.

The Peace Corps will continue to pay for the first month of limited health insurance after Peace Corps service for returning Volunteers, at no cost to them.

To ensure that Volunteers are able to get the care they need as they transition to their next steps after their service, volunteers have options to purchase up to 18 additional months of AfterCorps’ limited benefit health insurance coverage. However, returning Volunteers can now access health insurance plans under the Affordable Care Act.

Before closing service, volunteers receive information and resources to help them access their choice of insurance coverage after the end of their AfterCorps coverage.

There will be no change to the health care volunteers receive during their service through their Peace Corps

Medical officers.

Get more information about coverage as an applicant, active volunteer or after service.

For more facts, read this PDF.

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Immigrants

Immigrant families have important details to consider in the Health Insurance Marketplace. Most people in the groups below are able to qualify for coverage through the Health Insurance Marketplace:

  • U.S. citizens
  • U.S. nationals
  • Lawfully present immigrants

For a brochure with helpful information on immigrant services including healthcare, click here.

Undocumented immigrants are not eligible to buy health insurance on the Marketplace or to receive premium tax credits or other savings. This brochure will help with services to get you the documentation you need in order to gain access to healthcare.

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Same Sex Partners and Marriage and Discrimination

An insurance company must offer health coverage to same-sex spouses the same as they would for opposite-sex partners. ACA law does not allow for discrimination.

As long as a couple was married in a state with legal jurisdiction to authorize the marriage, an insurance company can’t discriminate against them when offering coverage.

This is true regardless of the state where:

  • The couple lives
  • The insurance company is located
  • The plan is sold, issued, renewed, or in effect

Married same-sex couples and lower costs

The Marketplace also allows married same-sex couples and married opposite-sex couples the same available premium tax credits and lower out-of-pocket costs on private insurance plans in all states.

In most cases, a married couple has to file a joint federal tax return to be eligible for premium tax credits and other savings on a Marketplace plans.

Learn about the limited exceptions to the joint-filing rule.

If you and your spouse plan to file a joint federal tax return for 2016, select “yes” when asked if you are married when filling out your Marketplace application.

Get more information on how to answer Marketplace application questions about your family and household.

Get more information about same-sex spouses from the IRS.

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Disabilities

There are plenty of options for people with disabilities. If you have Medicaid or Medicare, you have qualified ACA coverage under the health care law and don’t need a Marketplace plan.

If you don’t have health coverage, fill out a Marketplace application to find out if you qualify for savings on a private health plan or for coverage through Medicaid.

These pages have information on the following topics:

New health care law requires all plans to cover treatment for pre-existing conditions from the very first day for Marketplace, Medicare, Medicaid, and private plans. No plan can apply an annual or lifetime limit to your coverage.

Learn more about your rights and protections under the health care law.

Learn about the benefits that marketplace health plans must cover.

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Long Term Care Insurance

Longterm care insurance (LTC), is insurance that helps provide coverage for the cost of long-term care for an extensive period of time. It covers services including personal and custodial care in a home, a community, or facility. Long-Term Care is usually not covered by health insurance, Medicare, or Medicaid.

Unlike qualified plans, these are still subject to underwriting review, meaning your age and health are taken into consideration. If you are already in poor health you may not qualify, or you may be limited to the amount of coverage you receive or pay a higher premium for coverage than a healthier person.

The amount of premium will affect how long the coverage will last, whether 2-5 years or as long as you live. The policy has a maximum amount it will pay per day and a maximum number of years. Multiplying the amount per day by the number of days covered will give the lifetime maximum of the policy.

The Affordable Care Act has not affected the ease of obtaining or the affordability of Long Term Care insurance yet. It largely relies on some improved areas of funding for financial incentives for states to provide home and community-based services. The funding also goes toward individuals with disabilities to be able to live in the community.

You may qualify for a public program for help, but you may want to add in some other financial options to extend your coverage. These include:

  • Personal income and savings
  • Life Insurance
  • Annuities
  • Reverse Mortgages

Some states are participating in a State Partnership Program that links Partnership-qualified (PQ) long-term care policies to private insurance companies with Medicaid. The intent is to provide:

  • The ability to purchase shorter term, more complete, long-term care insurance
  • Inflation protection, so the dollar amount of benefits received can be higher than the amount of insurance coverage you purchased
  • The opportunity to apply for Medicaid under modified eligibility rules if your policy maximum is reached, but you still need care
  • A special “asset disregard” feature to help you keep assets like personal savings above the usual $2,000Medicaid

Long Term Care Insurance is usually purchased directly from an insurance agent, financial planner, or broker. Important things to remember:

  • States regulate which companies can sellling-term care insurance
  • States regulate the products that companies can sell
  • There are more than100 companies offering long-term care insurance nationally, but 15 to 20 insurers sell most policies

Contact your state’s Department of Insurance for more information on Long-Term Care insurance policies.

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Mental Health

Marketplace plans cover mental health and substance abuse services as essential health benefits.

All plans must cover:

  • Behavioral health treatment, such as psychotherapy and counseling
  • Mental and behavioral health inpatient services
  • Substance use disorder (substance abuse) treatment

Your specific behavioral health benefits will depend on your state and the health plan you choose. A full list of what each plan covers, including behavioral health benefits, is available when you compare plans in the Marketplace.

Pre-existing mental and behavioral health conditions are covered, and spending limits aren’t allowed. You can’t be denied coverage or charged more for a prior condition. Coverage begins on the first day and there are no yearly or lifetime dollar limits.

Parity protections for mental health services

Limits applied to mental health and substance abuse services can’t be more restrictive than limits applied to medical and surgical services. The following are examples of parity protection to avoiding duplicate coverage and costs:

  • Financial —deductibles, copayments, coinsurance, and out-of-pocket limits
  • Treatment —limits to the number of days or visits covered
  • Care management —being required to get authorization of treatment before getting it

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Incarcerated Individuals

Special rules apply for health care coverage for incarcerated people. For purposes of the Marketplace, “incarcerated” means serving a term in prison or jail. It does not mean:

  • Incarceration doesn’t mean living at home or in a residential facility under the supervision of the criminal justice system or living there voluntarily. Incarceration does not include being on probation, parole, or home confinement.
  • You’re not considered incarcerated if you’re in jail or prison pending disposition of charges, being held but not convicted of a crime.
  • If you’re incarcerated, you can’t use the Marketplace to buy a private insurance plan. But after you’re released you can.

After being released from incarceration, you may qualify for lower costs on monthly premiums and out-of-pocket costs. This will depend on your household size and income during the year you’re seeking coverage.

Learn more to see if you will save on health coverage by doing a quick check.

After you’re released, you must either have health coverage, pay the fee, or get an exemption.

You’ll have a 60-day Special Enrollment Period to sign up for private health coverage to enroll in private health insurance even if it’s outside the Marketplace Open Enrollment period. After 60 days you won’t be able to buy private health insurance until the next Marketplace Open Enrollment period, unless you qualify for another Special Enrollment Period.

Incarcerated people and the fee for being uninsured

Because you aren’t eligible to buy private health insurance through the Marketplace while in prison or jail, you don’t have to pay the penalty that some others without insurance must pay.

Learn more with a guide for getting insurance in the Marketplace.

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Prescription Drug Plans

Prescription drugs and pricing is currently an area of concern. The coverage is considered an essential health benefit, but it is not required to be as good as Medicare Part D coverage. If you are among the people who do not currently qualify for Medicare, people of average health and income levels, and under the age of 65, there seems to be a lack of options. ACA qualified plans include prescription drug coverage, but the use of tiered systems to categorize these drugs result in high co-payments and separate deductibles. The most costly drugs are put into the highest category and consumers end up paying 100% until the deductible is met. Average annual drug deductibles are between $4,800 and $6,800.

Private insurers, along with Marketplace and Small Business Options Program (SHOP) plans have a choice to be ACA credible each year and need to let you know in writing. If you do not have a creditable plan, you will be required to pay a fee at tax time.

Prescription coverage that is creditable is in the following categories. If you have these plans, you are advised to keep them. Keep any creditable prescription drug coverage information you get from your plan. You may need them if you join a Medicare Prescription Drug Plan later. Don’t send these creditable coverage letters/certificates to Medicare.

Government and Military

  • The Federal Employee Health Benefits (FEHB) Program plans usually include prescription drug coverage, so you don’t need to join a Medicare drug plan. However, if you decide to join a Medicare drug plan, you can keep your FEHB plan, and your plan will let you know who pays first.

For more information, you can call the number on your plan or contact the US Office of Personnel Management (OPM).

Find your plan’s contact information by a general search with Medicare’s Plan Finder

Find your plan’s contact information by a search by plan name with Medicare’s Plan Finder

  • Veterans Affairs

Prescription drug coverage is offered through the Veterans Affairs (VA) program. Medicare Prescription Drug Plans can be used in addition if you qualify for Medicare, but you can’t use both types of coverage for the same prescription at the same time.

For more information, read this health research page at My Health e Vet.

  • TriCare Military Coverage

Most people with TRICARE who are entitled to Medicare Part A must have Medicare Part B to keep TRICARE prescription drug benefits. If you have TRICARE, you don’t need to join a Medicare Prescription Drug Plan. However, if you do, your Medicare drug plan pays first, and TRICARE pays second. Adjustments will need to be made to coordinate your network pharmacy with a TriCare network pharmacy.

For more information Contact the TRICARE Pharmacy Program.

Tricare is now partnered with Express Scripts mail order and retail prescriptions providing their service to people who qualify for subsidies for health insurance. Learn more about this program by reading the information found here.

American Indians and Alaska Natives

Prescription benefits are available to members of federally recognized tribes or Alaska Native Claims Settlement Act (ANCSA) Corporation shareholders.

Indian health (IHS) facilities or Tribal health facilities provide prescription drug coverage and also participate in the Medicare prescription drug program. If you get prescription drugs through an Indian health facility, you’ll continue to get drugs at no cost. Joining a Medicare Prescription Drug Plan also helps the Indian health facility because Medicare pays the Indian health facility for the cost of your prescriptions. Medicare doesn’t affect your ability to get services through the IHS and tribal health facilities.

Each state also decides how its State Pharmacy Assistance Program (SPAP) will work with Medicare prescription drug coverage. Some states may choose to give extra coverage when you join a Medicare prescription drug plan.

Contact your State Pharmacy Assistance Program to get more information.

Many with limited income and resources can qualify for Extra Help paying for their prescription drug coverage. Find your level of extra help here.

Learn more by talking to your health benefits coordinator at either Indian Health Services (IHS) or Tribal HealthCare to understand how your coverage is subsidized through Medicare’s Part D Plan.

Employer-Based

Employer or union health coverage refers to health coverage from you, your spouse’s, or other family member’s current or former employer or union. If you have prescription drug coverage based on your current or previous employment, your employer or union will notify you each year to let you know if your prescription drug coverage is creditable. Keep the information you get from them for future reference when other prescription coverage opportunities present themselves.

It is highly recommended to call your old employer’s benefits administrator for more information before making any changes to your coverage. If you join a Medicare Prescription Drug Plan, you, your spouse, or your dependents may lose your employer or union health coverage.

  • Cobra

There may be reasons why you should take Medicare Part B (if you qualify) instead of, or in addition to, COBRA. However, if you take COBRA that includes prescription coverage, you’ll have a special enrollment period to join a Medicare Prescription Drug Plan without paying a penalty when the COBRA coverage ends.

Reminder: Once you qualify for Medicare, you may want to consider the drug plans with them because most of the Medicare Supplement or (Medigap) options for coverage are not creditable plans and may result in paying a fee at tax time.

Learn more about how State Health Insurance Assistance Program (SHIP) can help you decide what is best for you.

Medicare Stand-Alone Prescription Plans (PDP)

Medicare offers prescription drug coverage to everyone qualified with Medicare. If you decide not to join a Medicare Prescription Drug Plan (Part D) when you’re first eligible, and you don’t have other creditable prescription drug coverage, or you don’t get Extra Help, you’ll likely pay a late enrollment penalty.

Learn how you can save on drug costs.

The late enrollment penalty is based on the average premium amount for prescription coverage which is $34.10 in 2016. You will be charged 1% of the premium penalty for each month you were not covered by a plan.

  • Medicare Supplement (Medigap) drug plans

Medicare Supplement or Medigap policies can no longer be sold with prescription drug coverage, but if you have drug coverage under a current policy, you can keep it.

If you join a Medicare Supplement drug plan, your insurance company must remove the prescription drug coverage under your policy and adjust your premiums.

Your drug costs are covered by Medicare Part D plans that are available through private insurers and often called PDP. You’ll need to join a Medicare Prescription Drug Plan (PDP) for Medicare to pay for your drugs. In many cases, you’ll pay a small amount for your covered drugs. Other, more complex cases, will involve the coverage gap.

The Coverage Gap Explained

When the Supreme Court ruled that states had the choice of opting out of the Obamacare’s Medicaid expansion in 2012, expansion advocates predicted a terrible outcome for anyone caught in the Coverage Gap. The coverage gap refers to the segment of the adult population living in poverty but with incomes that make them ineligible for Medicaid because their state didn’t expand Medicaid coverage. Incredibly there are people who have incomes too low to receive the subsidized comprehensive coverage provided by the Affordable Care Act on the Health Insurance Marketplace.

To get Medicare drug coverage, you must join a plan run by an insurance company or other private company approved by Medicare. Each plan can vary in cost and drugs covered.

  1. Medicare Prescription Drug Plan (Part D). These plans (PDP) add drug coverage to Original Medicare, some Medicare Cost Plans, some Medicare Private Fee-for-Service (PFFS) Plans, and Medicare Medical Savings Account (MSA) Plans.
  2. Medicare Advantage Plan (Part C)(like an HMO or PPO) or other Medicare health plan that offers Medicare prescription drug coverage. You get all of your Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance) coverage, and prescription drug coverage (Part D), through these plans. Medicare Advantage (MA) Plans with prescription drug (PD) coverage are sometimes called (MA-PDs). You must have Part A and Part B to join a Medicare Advantage Plan.

Find a Medicare drug plan with the Medicare Plan Finder.

Medicare and Medicaid Combined

If you qualify for help from your state Medicaid program to pay for your Medicare premiums, join a Medicare Prescription Drug Plan PDP so that Medicare can pay for your drugs. You will automatically qualify for Extra Help with your prescription drug costs. If you don’t join a plan, Medicare will enroll you in one to make sure you don’t miss a day of coverage.

  • Each state decides how its State Pharmaceutical Assistance Program (SPAP) works with Medicare prescription drug coverage. Some states give extra coverage when you join a Medicare Prescription Drug Plan. Some states have a separate state program that helps with prescriptions.

Contact your State Pharmaceutical Assistance Program (SPAP) to see how you can get help.

Learn more about Medicaid’s Extra Help Program for Medicare Prescription Drug coverage here.

 Medicaid

If you have full coverage from Medicaid and live in a nursing home, you pay nothing for covered prescription drugs.

If you live in an assisted living or adult living facility or a residential home, you’ll pay a small copayment for each drug.

If you don’t join a drug plan, Medicare will automatically enroll you in one to make sure you don’t miss a day of coverage. You can switch to another plan at any time.

Long Term Care

Long-term care pharmacies contract with Medicare Prescription Drug Plans to provide drug coverage to their

residents. If you’re entering, living in, or leaving a nursing home, you’ll have the opportunity to choose or switch

your Medicare drug plan. This allows you to choose a plan that contracts with your nursing home’s pharmacy.

Other Social Services

  • If you get housing assistance from the Department of Housing and Urban Development (HUD), you may want to join a Medicare Prescription Drug Plan.
  • In addition, if you qualify for Extra Help, you won’t lose your housing assistance. However, your housing assistance may be reduced as your prescription drug spending decreases. The value of the Extra Help paying your drug costs will make up for any decrease in your housing assistance.
  • If you get food stamps, you may want to join a Medicare Prescription Drug Plan. If you qualify forExtra Help, your food stamp benefits may decline, but that decline will be offset by Extra Help.
  • If you’re near the food stamps eligibility cutoff, you may lose your minimum food stamp benefits because you’ll be paying less for your prescription drugs. The value of the Extra Help paying your drug costs will make up for any decrease in food stamp benefits.

Learn about Extra Help here.

Tricare Federal Pharmacy Services is now partnered with Express Scripts mail order and retail prescriptions. They provide their prescription service to anyone receiving assistance to pay for their Marketplace health plans.

Learn more about this program by reading information about Express Scripts and TriCare found here.

Choosing a Prescription Drug Plan

Once you choose, here’s how you can join:

  • Enroll on the Medicare Plan Finder or on the plan’s website.
  • Complete a paper enrollment form on your own or with the help of a health insurance agent.
  • Call the insurance company listed for the plan or call a health insurance agent for help.
  • Call 1-800-MEDICARE (1-800-633-4227).

When you join a Medicare drug plan, you’ll give your Medicare number and the date your Part A and/or Part B coverage started. This information is on your Medicare card. 

Joining a Medicare Drug Plan Affects Your Medicare Advantage Plan

If your Medicare Advantage Plan (Part C) includes prescription drug coverage and you join a Medicare Prescription Drug Plan (Part D), you’ll be dis-enrolled from your Medicare Advantage Plan and returned to Original Medicare (Parts A and B).

Once you have Original Medicare again, you can purchase a Medicare Supplement policy if necessary.

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Dental and Vision Insurance

In the Health Insurance Marketplace, you can get dental coverage as part of a health plan, or by itself through a separate dental plan. You can only buy a dental plan on the Marketplace if you are enrolling in a health plan at the same time.

  • Health plans that include dental coverage.In the Marketplace, dental coverage is included in some health plans. You can see which plans include dental coverage when you do plan and price comparisons.If a health plan includes dental coverage, the premium shown for the plan includes both health and dental coverage in one premium payment.
  • Separate, stand-alone dental plans.In some cases separate, stand-alone plans are offered. You may want this if the health coverage you choose doesn’t include dental coverage, or if you want different dental coverage.

If you decide you want a stand-alone dental plan, you can choose one after you select your health plan.

Purchasing a dental plan separately gives you 2 separate premiums, one for health and one for dental.

The high coverage level has higher premiums but lower copayments and deductibles. So you’ll pay more every month, but you’ll pay less when you use dental services.

The low coverage level has lower premiums but higher copayments and deductibles. So you’ll pay less every month, but you’ll pay more when you use dental services.

Adult and Child Dental Insurance in the Marketplace

Under the health care law, dental insurance is essential for children 18 and under. If you’re getting health coverage for someone 18 or younger, dental coverage must be available for your child either as part of a health plan or as a stand-alone plan.

Note: Dental coverage for children must be available, you don’t have to buy it.

Dental coverage for adults is not an essential benefit and insurers don’t have to offer it. Since it is optional, no penalty fee is applied if you or your child doesn’t have it.

Adult and Child Vision in the Marketplace

Vision benefits for adults are not considered essential coverage and is not addressed in the Marketplace.

  • Stand-alone vision plans are available for purchase
  • Eyewear is subject to benefits maximums

Pediatric vision is considered an essential health benefit and is required in individual and Small Employer Group medical plans. Many health plans prior did not provide coverage for needed child health services, and 12 percent of children have not had a doctor’s visit in the past year. The Affordable Care Act requires coverage for basic pediatric services under all health plans, including coverage of vision needs.

  • Standalone vision plans are available for purchase
  • There is no dollar limit because the dental industry shifted from benefit maximums to formulary type plans

Health plans on the health insurance marketplaces will include comprehensive eye exams, and glasses or contact lenses to correct refractive issues. Pediatric vision screenings and comprehensive eye exams are also covered. screening may indicate whether the child should have a comprehensive exam.

If there is are stand-alone vision plans available within the exchanges, insurers do not have to add it to qualified health plans. That means, in the marketplace, medical plans with vision coverage might only cover children

Adults will need to purchase separate vision plans. Adults and dependents purchasing vision through an exchange will likely have different benefit plans.

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