Health insurance exchanges are a key component of the Affordable Care Act. They were created in order to make coverage more accessible and affordable, providing the uninsured with comprehensive health insurance plans that are federally regulated in availability and cost. Health plans on the exchange follow the same laws as the private market under the ACA, allowing anyone to enroll regardless of their health, and not have their premiums increase for health status, gender or occupation.
Plans are administered by the state or the Department of Health and Human Services, and sold by private health insurance companies in a competitive setting: the health insurance marketplace, a comparison-shopping insurance resource. All health plans are required to sell identical plans so that consumers are guaranteed coverage on services like prevention, emergency care and prescriptions. These services are called essential health benefits, and every plan on the exchange includes ten different categories to provide you with consistent coverage on the most-needed types of care.
Besides the requirement for essential health benefits, exchange plans also differ from private plans in that costs can be reduced with subsidies for households who earn between 100 to 400 percent of the poverty line. Tax credits cannot be awarded to policyholders on the private market, but are designed to help people afford coverage on the exchanges. If you qualify, your premium and possibly your cost sharing will be reduced.
How the Exchanges Work
Choose from a range of health plans. Pick the insurer who offers the best deal.
All health plans on the exchange are virtually the same with the exception of provider networks. Regardless of the carrier, each will provide Bronze, Silver, Gold and Platinum level plans that cover the same services. The different coverage levels are 60, 70, 80 and 90 percent after deductible on most services, with copays on other types of care, like a comprehensive plan that may have been out of reach in the past. Because each insurer selling coverage on the exchange has to meet certain criteria for cost and coverage, you get to compare plans on an apples-to-apples basis and select the plan that best fits your budget. As each carrier is offering an identical product, they are essentially competing for your business.
User-friendly, fair setup
On the marketplace, it’s easy to view the break down of covered services and cost sharing, such as deductibles, coinsurance or copayments, and out-of-pocket limits, as well as premium rates from each company. With all companies offering the same set of benefits and coverage levels, the law intends for insurers to price competitively and not adjust their benefits so that only healthy people apply. You can review plans side by side through your state’s official exchange site, or go through a licensed insurance agent like those at East Coast Health Insurance.
Education and transparency
As well as offering a selection of health plans, the exchange also provides information about plan details, including premiums, covered care, wellness programs and chronic disease management. The site and any agent helping you apply will let you know your eligibility for tax credits and how much financial assistance you may be able to receive. As these plans are a recent development and insurance is already confusing to many Americans, exchanges attempt to keep all necessary information available so you can make the best choice and know how your coverage works.
Coverage for Individuals and Small Businesses
Individuals and families who don’t receive coverage through their employer, or whose group plan is inadequate, can sign up for a plan on the exchange. Small companies with less than 50 employees are also able to purchase coverage through the Small Business Health Options Program (SHOP). Financial assistance is available for both individuals and small businesses through tax credits to reduce premium costs.
Every insurance company selling plans on the exchange must provide the following four tiers of coverage to meet federal requirements. Different deductible amounts are offered so that you can find a premium rate that works for you. Tax credits may be applied to any plan on the exchange, but they also vary with the cost of your plan. Regardless of the coverage level you select, all of the same benefits are included in each plan.
Bronze Plan: 60% after deductible
Highest cost-sharing, lowest premium. The most cost-effective plan on a monthly basis, but could result in large out-of-pocket expenses as you pay 40% of the bill even after you’ve satisfied the deductible.
Silver Plan: 70% after deductible
The mid-level plan with lower premiums and moderate cost-sharing — the top recommendation for those receiving tax credits. You pay 30% for hospital care and other covered services once your deductible is met.
Gold Plan: 80% after deductible
Second-highest coverage level, and the most desirable balance of coverage and costs in most cases. This way, you pay a slightly larger amount per month while paying less when it’s time for that emergency room visit.
Platinum Plan: 90% after deductible
The top level of coverage on the exchange. Your plan covers the majority of the bill for approved services once you’ve paid through your deductible. While your premiums are the most expensive, you gain the security of much lower out-of-pocket costs.
For children and young adults under age 30, a more minimal plan with a high deductible is offered and will count as creditable coverage. These plans sold on the exchange have low premiums and cover a select few services, making sure the young, healthy population has access to free preventive care.
Under the Affordable Care Act, all health plans on the exchange must include each category of essential health benefits (EHBs), to ensure policyholders have access to a variety of services. The ten categories outline commonly used services, covering certain types of care that may have been excluded by numerous health plans in the past, such as maternity and mental health care. Even with catastrophic plans, preventive care is included at no cost for all exchange policies. The following are the ten categories of essential health benefits required for inclusion in each exchange plan in all states.
- Prevention, wellness and chronic disease management
- Pediatric care
- Maternity and newborn care
- Laboratory and X-ray services
- Prescription medications
- Emergency room visits
- Ambulatory care
- Mental health and substance abuse services including behavioral health treatment
- Rehabilitative and habilitative services and devices.
East Coast Health Insurance is a certified broker of exchange plans. Call a licensed agent for more information, to enroll, or find out if you qualify for financial assistance at 888 803 5917.