Affordable private medical health insurance through an Exchange is available and very popular in most parts of the country. We explain how to find and buy these Marketplace plans. As group insurance premiums continue to rise, and employers contribute less towards their employee’s premiums, private individual and family benefits are often becoming an affordable alternative. These types of policies are usually very flexible and can be altered every year, unlike many more restrictive employer-provided plans. Federal and state-based Exchanges allow consumers to enroll in healthcare plans that cover pre-existing conditions and often are heavily discounted with advanced tax-credits.
Typically, an employer will feature only one or two companies for their workers to consider during an open Enrollment. Although there may be many variations of coverage, including high-deductible HSA plans and comprehensive plans, choices may be limited. If your personal physician is not listed as a Network-provider, you likely will be forced to pay a larger out-of-pocket expense or change to a different physician. It’s also possible that an HMO is offered, but not a less-restrictive PPO. Short-term plans are not offered by employers, and generally should not be compared to a group medical plan. However, if the annual Open Enrollment period is missed, a temporary plan may have to be considered.
Employer Shared Responsibility Provisions
“Employer Shared Responsibility Provisions” require larger businesses to offer “affordable” healthcare benefits that contain required mandated benefits. This “employer mandate” applies to companies that have at least 50 full-time employees from the prior year. For 2024, if a worker’s contribution towards the purchase of their medical coverage is more than 8.39% of their household income, it is not considered “affordable.” The spouse and dependent costs are not considered in this calculation, despite the cost of dependent coverage is often the most expensive part of a group plan. Proposals have been introduced to fix the “family glitch,” which penalizes some family members who must pay high premiums for their group medical coverage.
Previously, many employers ceased offering medical coverage to employees, and other companies reduced the number of workers that are eligible for coverage. The reason is simple. It was cheaper to pay a tax penalty and let the government offer benefits. The annual penalty of $3,000 was often far less expensive than the cost of paying for a comprehensive policy. The vast majority of employers (small and large) offer healthcare benefits. However, the level of employer-contribution can greatly vary, and smaller companies are not required to offer ACA-complaint options. They can provide needed funds to help pay for their medical coverage.
Choose Your Own Healthcare Coverage – More Options
When purchasing your own personal policy, you are free to choose among many large reputable insurers. Depending on where you live, some of the most popular insurers are Blue Cross, UnitedHealthcare (limited states), Kaiser, Molina and Ambetter. Often, there are smaller regional companies that offer competitive rates such as Geisinger Online in Central and Northeastern Pennsylvania, or Medical Mutual in Ohio. PPO plans are typically hard to find since the majority of available options are HMO or EPO contracts. Out-of-pocket expenses are typically much higher when using non-network providers, and network-negotiated reductions can not be used.
Not all large and well-established companies are active participants in the State Health Insurance Marketplace. For example, although Blue Cross Blue Shield (BCBS) carriers in most states are active, several large companies such as Cigna, Aetna, and UnitedHealthcare are skipping many states. However, you may be able to purchase some of their policies that aren’t otherwise available through Marketplaces. These options are “off-Exchange” policies, and are compliant. Temporary plans, although inexpensive, are non-compliant.
Christian health insurance programs have also become more popular since the passage of Obamacare. Although not eligible for federal subsidies, these contracts are often low-cost alternatives that provide semi-comprehensive or comprehensive benefits. There are also no Open enrollment deadlines, and medical underwriting is simplified. Rates are lower for younger applicants and low-cost family plans are also offered. Several benefit levels are available with different out-of-pocket expense options. Payment for medical expenses is not guaranteed, and typically, these plans are not state and federal regulated.
Non-Compliant Plans – Inexpensive, But Be Careful
An HSA Will Reduce Your Costs
Your own policy can sometimes be better-customized to meet your individual or family needs. As an example, if maternity coverage is not needed, there are many policies that exclude maternity benefits and subsequently reduce the premium. There also may be specific riders that provide targeted benefits for your specific situation.
Important: these specific options do not comply with ACA Legislation, may not cover pre-existing conditions, and are ineligible for federal subsidies. Fortunately, the 2.5% household income tax will no longer apply if you choose one of these policies. In most states, a short-term plan can be purchased during the Federal Marketplace Open Enrollment period.
One common example of optional benefits is an enhanced accidental injury benefit that can be added as an inexpensive rider. This coverage is often used when there are dependents at home. Once the dependents are no longer in the household, you can remove the rider. You may even wish to replace it with a rider that better fits your needs, such as a critical illness rider. UnitedHealthcare offers many riders to their non-compliant short-term plans.
HSAs – Compliant And Affordable
Often, a Health Savings Account (HSA) is great option to consider. When purchasing your own medical coverage, you are free to choose among many companies with a wide variety of affordable deductible options. You are also able to pick the bank of your choice if you are going to make contributions into the HSA. With group coverage, you may not have those options available to you. In fact, it’s possible that taking out an HSA or high-deductible plan may not be one of the policies in their package. This is understandable considering an employer will often choose a copay option (only) since they are the most popular.
Group insurance benefits provided by an employer can have some advantages. For example, if the employer is paying a substantial portion of the premium (or all of the premium), it may be wise to keep group coverage. Although the percentage of employer contributions for benefits is reducing, some larger companies still pay a large portion of the premium for their employees. But medium-size and small-size companies are definitely cutting back. And with recent legislative action in Wisconsin and Michigan, union clout seems to be reducing.
Also, if there is a major health condition present, such as diabetes, cancer or heart disease, it will be difficult to qualify for a private plan (except under designated Open Enrollment periods), and staying with the current employer policy may be the best option. Also, group policies may also provide specific benefits that an individual plan may not offer. It’s important to clearly identify the coverages that are the most important to you. Since medical conditions can rapidly change, it’s also important to annually review plan benefits.
Medical Underwriting No Longer Used
Affordable plans are no longer medically underwritten, so taking a physical is not a requirement. An application for coverage must be completed and submitted, and subsequently approved before coverage begins. But you can not be turned down for medical issues unless it’s a non-qualified policy. It’s important to closely compare the rate that was offered when the policy was approved. It is possible that a difference in age or smoking status could increase the proposed rate. However, these increases will be moderate. All family members can be covered under one policy with a maximum out-of-pocket expense limit that includes two individual deductibles.
The quotes you receive from our website are free. You are never obligated to purchase any plan or take our advice. Of course, we work with private health insurance plans every day, so hopefully the information we offer is helpful and will help you in the buying process. Some of the options you view will be state-specific, meaning they are only available in your state. Not all carriers offer policies in all states, and federal subsidies (if offered) may vary slightly from one state to another.