According to Oxford Dictionary, insurance is “an arrangement by which a company or the state undertakes to provide a guarantee of compensation for specified loss, damage, illness or death in return for payment of a specified premium.”
Let’s break it down in real talk:
You find an insurance plan that you like. Yay! You pay a monthly premium to the health insurance carrier so that they will cover any potential medical needs you will have. The carrier holds your money until you make a claim (i.e. go to the doctor, the emergency room, get a prescription), and then they will help pay for the service you received. What they pay you depends on your deductible, co-pay or your co-insurance.
How much does a health insurance broker cost?
Health insurance brokers are free (at least for the person buying the plan, which is YOU).
Here is how a broker works:
You contact a broker and tell them what you’re looking for in a health insurance plan. They do some research and give you a couple of plan options. You select the option you want and purchase the plan through the broker (again, this is free to you). This is when the relationship begins between you and the health insurance carrier you just bought a plan with. Essentially a broker is like a middleman (or woman!), and the carrier pays the broker a commission for making this connection.
Brokers are free to you and they’re really helpful: they save you the time and energy of searching for a health insurance plan.
Why is health insurance so expensive?
Here is a breakdown on why insurance is so costly:
Health care is expensive. Hospital stays, surgeries, medical tests, prescription drugs….all of these things cost a ton of money. And the costs keep going up, unfortunately.
Insurance companies have to be solvent, meaning they need enough money in the bank to be able to financially cover every person who has purchased a plan through their company.
Insurance companies have to give advanced payment for your preventative care. A qualified health plan has to 100% cover your preventative care and wellness checks.
Health insurance providers have to share the cost of preexisting conditions. Due to the Affordable Care Act ruling, no one can be turned away from getting health insurance due to a pre-existing condition. This means the cost is distributed to everyone.
Insurance companies have to pay staff, agents and brokers. (And unfortunately, like any business, there are often inefficiencies due to overstaffing, business processes, etc.)
What is Open Enrollment and what are the deadlines?
Open enrollment is the yearly period when you can buy individual health insurance. The Open Enrollment Period for most states is November 1st – December 15th. If you enroll by December 15th, your coverage will begin January 1st of the following year.
What happens if I miss Open Enrollment?
If you miss open enrollment, you’re stuck without insurance for another year.
…Unless you qualify for a qualifying event outside of open enrollment.
What is a qualifying event?
A qualifying event means when you can apply for insurance outside of November 1st to December 15th. You see, most of us HAVE to apply for insurance during November 1st and December 15th, otherwise known as enrollment period (these dates can change a little bit from year to year). However, outside of that time, if you have a baby, get married, lose your job- you know, big life stuff- then you may qualify to apply for insurance. Note: You have to apply for insurance within 60 days of said qualifying event.
Check out the list of qualifying events below.
You lost your coverage through job change, divorce, death in the family or graduation.
You fell off your parent’s insurance after you turned 26.
You had a change to income.
You had a change in immigration status.
You moved outside of your coverage area.
You got married. (Congrats!)
You had or adopted a child. (Congrats again!)
Is there a penalty for not having health insurance?
Starting Jan. 1, 2019, the tax penalty will be repealed. If you don’t have major medical health insurance for the 2019 coverage year, you won’t be penalized. However, there will still be a tax penalty for no health insurance in 2018. If you are uninsured this year, you could be penalized when you file your 2018 taxes in 2019, unless you’re eligible for an exemption.
Note: New Jersey, Massachusetts, and DC will impost their own penalties, and Vermont will join them in 2020.
What is the Affordable Care Act?
Otherwise known as “Obamacare”, this is the healthcare reform act President Obama signed into law on March of 2010.
What are the differences between an on-exchange plan and an off exchange plan?
When you hear the term “on-exchange” when associated with a health insurance plan, that refers to HeathCare.gov, the U.S. government’s marketplace to buy health insurance. In other words, an on-exchange health insurance plan is a plan available on HealthCare.gov. You may also hear it referred to as a “private exchange” plan.
Conversely, when you hear the term “off-exchange” when associated with a health insurance plan, that means it’s not available through HealthCare.gov. An off-exchange health insurance plan is a plan available through something like an insurance broker, a health insurance carrier or us, KindHealth!
Does HealthCare.gov have cheaper plans?
First, no one has “cheaper” health insurance plans, period. All health insurance plans are the same price everywhere, whether you get a plan on HealthCare.gov, through a broker or through a website. It’s illegal for anyone to offer you a “cheaper” plan.
However, HealthCare.gov does offer subsidies, and it’s the only place where you can apply for and potentially receive subsidies.
What’s a subsidy (aka tax credit, premium tax credit)?
It’s essentially government assistance. Your tax credit is based on the income estimate and household information you put on your Marketplace application.
You can use all, some, or none of your premium tax credit in advance to lower your monthly premium.
If you use more advance payments of the tax credit than you qualify for based on your final yearly income, you must repay the difference when you file your federal income tax return.
If you use less premium tax credit than you qualify for, you’ll get the difference as a refundable credit when you file your taxes.
You can buy health insurance through other sources, but the only way to get a premium tax credit is through the Health Insurance Marketplace.
What are the differences between the insurance companies?
Aetna: Aetna offers Teladoc, 24/7 access to a doctor, free of charge. Aetna also doesn’t require you to designate a primary care physician upon applying for a plan. This means you don’t have to get a referral from your PCP in order to see a specialist. Aetna is only offering EPO plans in 2016 (this could change next year).
Fact: Aetna was founded in 1853. Happy 163rd birthday, Aetna!
UnitedHealthCare: UnitedHealthCare has the largest network of doctors. A plan with UHC requires that you designate a primary care physician upon applying, and you need a referral from your PCP to see a specialist. UHC is only offering EPO plans in 2016 (this could change next year).
Fact: UHC is the largest health insurance carrier in the U.S.
Blue Cross Blue Shield: Blue Cross Blue Shield is only offering HMO plans for 2016 (this could change next year). With an HMO plan, you will need to designate a primary care physician and get a referral from you PCP to see a specialist.
Fact: One in three Americans use Blue Cross Blue Shield.
Humana: Humana primarily offers HMO plans for the year of 2016. They also have one Bronze PPO plan. With an HMO plan, you will need to designate a primary care physician and get a referral from you PCP to see a specialist.
Fact: Humana began as a nursing home company.
Scott and White: Scott and White has both HMO and PPO plans available in 2016, however, their network is localized to Central Texas.
Fact: Scott & White is available in 77 counties across Texas.
What is a health insurance network?
In technical speak:
A health insurance network is a list of doctors, specialists and hospitals that your health insurance provider has a relationship with. These medical professionals and establishments are contracted to offer you services at a specified rate.
In normal speak:
Doctors, specialists and hospitals can decide whether or not to partner with a health insurance provider (Aetna, Blue Cross Blue Shield, etc). If the doctor/specialist/hospital agrees to the provider’s terms, they will become part of their network.
There are four types of networks in health insurance: POS, EPO, HMO and PPO (most PPOs are going away though. Read our blog post on why). You’ll have the option to buy one of these plan networks when you apply for health insurance. Before you buy, check with either the provider or your doctors to make sure your medical team is in the network you’re interested in. Having your medical team in your network will ensure that you won’t pay out-of-network costs (i.e expensive) on medical services.
What is an HMO plan?
A Health Maintenance Organization plan (HMO) means you can only consult with physicians in your HMO network, otherwise you will pay out-of-network expenses (unless it’s an emergency). HMOs are often the most limited type of health insurance plans. When you apply for an HMO, you must select a primary care physician, and you have to get a referral from that primary care physician in order to see a specialist.
In plain English:
An HMO plan means a lot of your doctors may not take your insurance card. It’s important to check if your doctors take HMO plans before you apply. The other bummer is that you need to select your PCP (primary care physician) upon applying AND you have to get a referral from your PCP to go see a specialist (meaning you have to pay for TWO appointments). However, the nice thing about HMO plans is that they often have lower monthly costs because they don’t offer as wide of a doctor network.
HMOs are a great option if you can’t afford expensive monthly payments and don’t plan on going to the doctor a lot. If you do plan on going to the doctor a lot, a PPO, POS or EPO plans might be a better option.
Attention: This website is operated by KindHealth Insurance Services, LLC. and is not the Health Insurance Marketplace website. In offering this website, KindHealth is required to comply with all applicable federal laws, including the standards established under 45 CFR 155.220(c) and (d) and standards established under 45 CFR 155.260 to protect the privacy and security of personally identifiable information. This website may not display all data on Qualified Health Plans being offered in your state through the Health Insurance Marketplace website. To see all available data on Qualified Health Plan options in your state, go to the Health Insurance Marketplace website at HealthCare.gov