Everyone keeps asking me about buying a health insurance policy under the ACA, but really, I’m just like everyone else on this one, scratching my head and trying to make the best deal I can for my family; hoping I don’t screw up and choose the wrong thing! Besides being a financial planner, I’m also a little compulsive thorough. so I’ve been doing my homework, calling the exchange, my doctors, the insurance companies, accountants and insurance agents, trying to get answers.
To start with, let me reiterate that ultimately, I favor a single payer solution, but the ACA has so many tremendous improvements over our current system, that I am willing to overlook it’s imperfections, and celebrate it’s triumphs.
I started by looking at our potential healthcare spending. Now that all preventative services are covered at 100%, my husband kids and I will have to pay nothing for annual checkups, vaccines, mammograms, pap-smears, and all kinds of other things that used to cost a lot of money. Also, I’ve learned to go to Urgent Care centers instead of ER’s whenever possible (my 8 year old son made 2 trips to the ER last year and the bill was crazy!). So really, I want to not have to pay a fortune if I do have to go see a doctor, and I want to make sure that if one of us is in an accident or gets cancer, the bills aren’t the thing that kills us. We currently pay about $1,100 a month for really skimpy coverage, so my goal is to somehow pay less in monthly premiums AND have better benefits, if at all possible.
Instead of long prosaic paragraphs, I’m just going to give you a list of things I have learned about all this that you might find helpful.
1. If you are self employed in some way, run all the expenses you legally can through your business, and you may very well qualify for some government subsidies, which will reduce your monthly premiums (especially if you have kids).
2. Have kids (they will help you qualify for subsidies). Also, maternity is now covered by all policies.
3. you don’t have to buy a plan on the exchange, but if you buy a non-exchange plan, you can’t get subsidies, so you have to pay the entire premium no matter how much you make.
4. You don’t have to buy exchange plans on the health insurance exchange website! You can buy it through an insurance agent who has gotten certified to sell exchange plans.
5. Applying for coverage is a breeze. For anyone who remembers applying for private health insurance in the past, where you had to fill out pages and pages of embarrassing details, it’s pretty great to only have to give your date of birth, social security number and zip code. no one can be disqualified for a preexisting condition.
6. ALL the health insurance plans now sold MUST cover certain services considered preventative at 100%. No matter which plan you buy, you get a free annual check up, free vaccinations, and free cancer screenings. That means that all those premiums you pay are going to actually pay for your service, rather than just part of it.
6. Bronze level plans are the cheapest, but after the free stuff, you have to hit the $5,000 deductible before your insurer pays 60% of your bills ($10k if you’re a family). Your out of pocket max is $6,350 for an individual, and $12,700 for a family, so you’re paying 40% of the costs between the $5,000 and $6,350 or between $10,000 and $12,700 for a family, and then you pay nothing after that.
7. Silver plans cover 70% of the expenses between the $2,000 deductible and the $6,350 out of pocket max ($4,000 and $12,700 for families) BUT, unlike the bronze, lots of services are not subject to deductibles. Doctor visits, labs, x-rays, generic drugs and urgent care visits are all just a straight co-pay amount, but that amount doesn’t go towards your deductible. Only hospital stays do.
8. Gold plans: No deductible at all! lower co-pays for everything, 80% coverage of services up to out of pocket max (which is same as bronze and gold plans).
9. Platinum: No deductible, lower out of pocket max, cheap drug co-pays, you only have to pay 10% of your hospital bills up to the out of pocket max.
10. conclusion: If you know you have massive medical issues, and use a lot of medications and services, get the gold or platinum plan if you can because it may turn out to be way less expensive than a lower tiered plan with a lower premium and less benefits in coverage.
11. If you’re a regular person who has no idea how much medical services they may require in a given year, this is all a little ridiculous, but the good news is that your downside is really limited now no matter which plan you get by the out of pocket maximum.
12. If you live in Los Angeles, you should know that Cedars Sinai isn’t contracted at this point with any insurer except HealthNet. The UC system and it’s hospitals and doctors are not contracted with Blue Shield. This may very well change, but take this into account when signing up. For this reason, I chose Anthem.
13. Call your doctors and ask which exchange plans they’re taking.
14. They’ll probably tell you they don’t know.
15. You can search on the insurer’s websites to see if your doctor is contracted with the exchange plan you want.
16. Anthem is only selling an “EPO” in LA County, which is an “exclusive provider organization” (EPO), which is smaller than a Preferred Provider Organization (PPO). On Anthem’s website, anything called “essential” means silver, anything called “core” means bronze, anything called “preferred” is gold and anything called “premier” is platinum.
17. There are a lot of unknowns at this point. Will Anthem and Blue Shield make a deal with Cedars? Will more doctors sign up with these exchange plans? Will the state insurance commissioner be granted the authority to regulate insurance premium increases?
18. If you screwed up by signing up for a plan that turns out to be really awful for you, you can change plans next year.
19. Good Luck! (no pressure of anything)
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