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Obamacare or ACA plans are traditional health insurance plans that meet certain requirements as set forth by the Affordable Care Act. These requirements include coverage for ten essential benefits that include preventative and routine visits, maternity, and emergency care. These plans also cannot charge higher premiums for people with pre-existing conditions, and their monthly premiums and out-of-pocket costs are on a tiered, metal-level scale.
It’s important to note that plans that meet ACA requirements can be purchased on-exchange (from the state exchange or federal exchange), and they can also be purchased off-exchange (from brokers or places like HealthinsuranceUSA.org). The main difference between these plans is that if you qualify for a subsidy from the government to help pay for your plan, you must buy a plan that is on-exchange. If you don’t qualify for a subsidy, you can purchase a plan either on-exchange or off-exchange. There may be plans that are sold on one exchange and not the other, or vice-versa, so it’s in your best interest to research both of these options.
The bronze plan is an economy plan. It has the lowest monthly premium, but the highest out-of-pocket costs. It is set up to have the insurance companies cover 60 percent of your healthcare costs, which leaves 40 percent to come out of your pocket. Because the out-of-pocket costs for this plan are high, it’s ideal for someone with good health and doesn’t plan on going to the doctor’s office often.
With this plan, 70 percent of out-of-pocket costs are covered by the insurance company, while the consumer covers the remaining 30 percent. The silver plan may be enticing to low-income individuals as you can only qualify for out-of-pocket savings (known as the cost-sharing reduction), by choosing a silver plan. Note: You can qualify for premium tax credits with any metal plan.
The gold plan has insurance companieuires covering 80 percent of medical care costs, which leaves 20 percent to be paid by the consumer. In exchange for the lower out-of-pocket costs, consumers will have to pay a higher premium. This plan is great for people who require frequent care and as a result, prefer lower out-of-pocket costs.
The final plan of the “metal plan” family is the platinum plan. This plan has the highest monthly premium, but the lowest out-of-pocket costs. In fact, the consumer is responsible for only 10 percent of their medical costs, while the insurance company pays for 90 percent. As such, this plan is great for consumers with conditions that require constant care/prescriptions.
A catastrophic plan is available to people who are 30 or younger, or someone who qualifies for a hardship exemption. With catastrophic plans, the consumer gets lower premiums and is covered for catastrophic medical events. But each catastrophic plan has a very high annual deductible (generally several thousand dollars per year) that must be met before the insurance kicks in.
Consumers would need to check with HealthCare.gov to see if they qualify for a hardship exemption. Some of the more common hardship exemptions are:
These government plans allow you to find coverage that fits your lifestyle and budget. Regardless of whether you decide to buy coverage from the government marketplace or the private exchange, just be sure to get covered before the open enrollment deadline.