Affordable Care Act

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Selecting a Marketplace Health Insurance Plan

December 4, 2014 : H&R Block

Choosing a health insurance plan can give you a headache. If you are buying one through the Marketplace for the first time, it might seem especially daunting. Here are a few steps you can take to make the process a little bit easier.

1. Look at your budget

Calculate how much you spent on medical expenses in the last year. Add up the cost of your monthly premiums and any out of pocket costs you paid such as co-payments for doctor’s visits, prescription medicines and so forth.

Look at the numbers to see any patterns. Did your out-of-pocket costs exceed your premium payments? Was your budget blown by unexpected medical costs for a few months? Use that information to determine how much you would ideally pay on health-related expenses in 2015.

2. Nail down the details

Confirm who will be enrolled with you in the plan. Gather details on their ages, location and whether or not they smoke. Those factors can affect plan pricing.

3. Set priorities

Before assessing healthcare plans, it’s best to identify the essential services that affect you the most. For example, if you need to refill a prescriptions each month, you will want to pay close attention to that portion of the insurance plans. If you have seen the same doctor for 20 years and don’t want to change, you’ll want to verify that they are in network for the new plan.

There are 10 essential services that every Marketplace plan must cover. However, the amount you pay for these services will vary from plan to plan.

  1. Ambulatory patient services
  2. Emergency services
  3. Hospitalization
  4. Laboratory services
  5. Pregnancy, maternity and newborn care
  6. Mental health and substance abuse services
  7. Prescription drugs
  8. Preventive and wellness services (such as vaccines and cancer screenings) and chronic disease management
  9. Pediatric services
  10. Rehabilitative and habilitative services and devices

4. Review and compare plans

The Marketplace divides plans into five categories: Catastrophic (only available to those who meet certain qualifications), Bronze, Silver, Gold and Platinum. They are ordered by their “actuarial” value, which means the higher value plans (Gold and Platinum) will pay more toward your health care expenses. While you will likely pay more in premiums each month for those plans, but you will pay less out of pocket on:

  • Deductibles – the amount you owe for covered services before the insurance will contribute
  • Copayments – the fixed amount you will pay for a health service
  • Coinsurance – your share of the costs of a covered health service

There are also outside resources that review and rank health insurance plans, like this one from Consumer Reports.

5. Anticipate changes

Before selecting a plan, try to consider any recent or anticipated changes you may have in the next year. For example, if you recently started taking a daily prescription medication, you may want to move into a higher tier with lower out-of-pocket costs. Or, if you are due to have a child, you may want to anticipate visiting the doctor much more frequently in the coming year. However, if your situation in 2015 will look much like 2014, you can use your past experience to help you select the right plan.

It’s helpful to remember that all of the health insurance plans in the Marketplace provide the same essential benefits and must cover pre-existing conditions.

Finally, remember to enroll in a plan by December 15, 2014 if you need coverage to start on January 1, 2015. Otherwise, the deadline is February 15, 2015.

Need help determining whether your 2014 tax return will be impacted by new requirements under the Affordable Care Act? Use our ACA Tax Impact Analysis to get answers.

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