How To Find Affordable Health Insurance? All You Need To Know
Anyone could be surprised by viewing the complicated and expensive health insurance system in the United States. Healthcare facilities are owned by the government or by private sector businesses worldwide, but in the United States, it is mainly owned by private non-profit organizations.
Unlike many other developed nations, the United States does not provide healthcare to the entire population as there is no single national health insurance system. It is important to understand available options and how to find affordable health insurance.
The health insurance system in the U.S primarily depends on employers who provide health insurance coverage to their employees and dependents. Moreover, the government has programs to cover healthcare expenses for the elderly, poor, and disabled.
Health insurance covers your medical expenses for various preventive health screenings, illnesses, injuries, procedures, prescriptions, etc. In addition, it will help you to avoid surprise medical expenses and lower the costs of medications, surgeries, and routine doctor visits.
Usually, health insurance is on top of mind when anyone is experiencing a change in job status, dealing with a significant life event like marriage, divorce, childbirth, or aged out from your family’s insurance coverage.
How to get health insurance?
In 2020, the number of uninsured persons in the United States had increased to approximately 30 million individuals. Always opt for affordable and comprehensive health insurance during the annual enrollment window.
The government health insurance marketplace
The health insurance marketplace or exchange depends on your income and eligibility for other insurance coverage. One can qualify for subsidies (premium tax credits) if one buys health insurance.
You can find a better plan for your situation and buy a marketplace policy even if you are eligible for insurance under an employer-based insurance program. But under job-based coverage, you probably won’t qualify for subsidies.
There are specific open enrollment dates, and the state exchanges have slightly different open enrollment dates. It is most recommended to buy insurance during the annual enrollment period as you can not purchase the rest of the year unless there is a life-changing qualifying event.
One can seek help from a marketplace navigator in some states, a certified application counselor, or any in-person assistance to know how to get health insurance. Do a handful of research for a marketplace policy at Healthcare.gov. Every state has its marketplace, and you will be redirected to the state’s website.
Work with an agent or broker
An agent or broker has experience evaluating health insurance plans, so they can effortlessly find a good policy for you. In addition, the federal government’s Find Local Help tool will help find a marketplace-trained private insurance broker. A broker who deals with the marketplace and non-marketplace insurance plans comes with numerous and least biased options.
Consumers do not pay any fee to brokers if they help them find affordable health insurance. However, health insurance companies pay brokers when they sell policies and sell policies from multiple insurance companies. On the other hand, agents sell policies from one insurance company.
Private health insurance brokers may show various options on private enrollment sites from several insurance companies. And if you want to qualify for subsidies, apply through Healthcare.gov on the state exchange. All available plans are eligible for subsidies, and the government’s health navigator’s help will be free.
Buy directly from an insure
Usually, the health insurance marketplace does not include every available insurance plan. Even you can find a better plan outside of the marketplace that better meets your coverage needs and budget. Do a handful of research on several insurers’ websites to find more suitable options. By searching only a single insurer’s website, you will see only options available there.
Affordable Care Act-compliant plans outside federal and state exchanges must have to meet the minimum essential coverage standards of ACA. Such coverage includes “pre-existing conditions, provision of important benefits, and offering preventive care before meeting your deductibles”.
Some non-ACA-compliant short-term plans are also out there outside the exchanges with fewer benefits. Short-term insurances with fewer benefits usually come with the idea that having insurance is better than having none at all.
The short-term health insurance market usually provides coverage with lower premium costs, an excellent alternative to ACA-compliant plans. But such plans do not come with an equal range for the consumer and sometimes deny coverage to patients with preexisting conditions. In addition, with limited ACA essential health benefits, including prescription drugs, mental health services, and mental care.
Such strategic policy limitations on coverage may outweigh the financial gains in cost-saving. So pay close attention when signing up through a private exchange and so-called alternatives to traditional health plans.
In short, if you will not apply through the federal marketplace, you will not be eligible for subsidies. And if the state operates its health insurance marketplace, buy it from your state marketplace to qualify for subsidies.
Furthermore, if the consumer’s income is too high for subsidies, it does not matter, but you could qualify for assistance if anyone earns less than expected. Typically, subsidies are based on how much you make and the buying coverage. After enrollment, get an estimate of your subsidies based on estimated income.
Buy through an online health insurance brokerage.
Online health insurance brokerage is known as private enrollment websites or private exchanges. They usually offer to help you compare health insurance plans or get the best available plan according to the given information. Consumers must compare various sites to meet the requirements.
The private exchange will show a selection of plans and provide more information. Consumer enrollment will make private exchanges earn a commission, and policies earn the brokerage a high commission. But do not prey on such incentives and get a complete picture of the policy by visiting various sites.
Private enrollment websites seek your personal information like preexisting conditions, weight, and various other factors affecting your eligibility for non-ACA plans. This personal information may help other websites market other products to you. Moreover, buying a health policy directly from a health insurance company or private exchange will not get you subsidies.
A membership organization
Any individual belonging to any association, professional organization, or part of any large group can obtain health insurance through its group rates. While looking for health insurance through an association or membership organization, make sure you purchase health insurance, not just a health service discount plan.
Discount plans save your money on a few prescriptions but won’t help you if you get any crucial disease. And if the association is a not-for-profit organization, it is established by a for-profit insurance agency through which it sells policies to association members.
Where to get health insurance?
In the United States, low-cost health insurance for adults is potentially available through several sources. One can get insurance through the government, job, university, or a private health insurance company. After exploring the options, one should consider that health insurance is not free and usually low-cost. Health insurance will be free or low-cost in the following terms:
Subsidization is subsidization if the plan’s monthly premiums are partly or paid by someone else. Usually, subsidy comes from the employer or the government. Subsidy means that the subscriber does not have to pay the total cost of insurance by themselves, and it will help them cover the healthcare that fits their budget.
With reduced plan benefits
While availing of low-cost health plans means that your healthcare cover is not much. It is not comprehensive health insurance and does not have an effective medical plan.
There are various options to get free or low-cost health insurance which will help to learn what is the least expensive type of health insurance and low-cost health insurance for adults.
A social welfare program that provides government-based health insurance to low-income people. Free comprehensive insurance for the people who qualify. However, few states charge small premiums to the people with eligible income scales. There are no premiums and no minimal cost-sharing, including deductibles and copayments.
Medicaid works slightly differently in each state, and to be eligible, one must meet the low-income guidelines. These guidelines depend on several factors, including age, disability, and pregnancy. According to the ACA expansion of Medicaid, checkout eligibility:
- For adults under 65, household income is not more than 138% of the Federal Poverty Level (FPL).
- Children and pregnant women, and it does not matter whether their income is above FPL.
- People aged 65 and older with lower incomes and few assets.
- Some states meet low-income guidelines and be a member of a vulnerable group.
- The vulnerable group includes pregnant, caretakers of a minor child, disabled children, and the elderly.
- Medicaid insured people are cared for at the same hospitals and by the same physicians as private health insurance subscribers.
Affordable Care Act subsidy
The Affordable Care Act (ACA) / Obamacare provides government subsidies and makes health insurance affordable for people who cannot afford healthcare plans. ACA includes cost-sharing reductions that reduce out-of-pocket costs during medical care.
The ACA is health insurance any individual can purchase through the marketplace if they meet certain income criteria. It usually helps to pay some or nearly all monthly premiums of a particular consumer.
How do subsidies work?
If any individual is eligible for subsidies (premium tax credits), the insurer could pay it monthly on your behalf. In other words, the government will pay a specific part of your monthly premium, and you have to pay the rest.
Subsidies will only work if you buy Obama healthcare insurance on ACA health insurance exchanges or the marketplace. They will not work if you purchase the policy outside the marketplace or you are under an employer sponsorship program.
To qualify for a premium subsidy depends on your locality and age. It does not matter whether your income is above 400% above the poverty level. But if the cost of the benchmark plan is not more than 8.5% of your income, you are not eligible for subsidies.
Obama care subsidies are for legally residing immigrants but not for undocumented immigrants. Due to subsidies, self-purchased health insurances are more affordable now. However, very few people purchase their coverage and usually get health insurance through the government or employer-sponsored plans.
Essential terms while seeking how to get health insurance?
There are some essential terms while purchasing health insurance. Understanding these terms will make you make the right and informed choice.
It is an amount that a health plan costs per month.
A deductible is an amount the consumer needs to pay towards healthcare services before the insurance plan starts to pay.
Copay is an amount that a subscriber has to pay while getting a health care service. While visiting any doctor’s office, the insurance plan will pay some of the cost, but you must pay a certain amount.
The amount you pay after meeting your deductible, like your plan, bears some cost, but you too have to pay some as a consumer. For instance, if you are going for a lab test, you should spend 35% of the total cost.
Suppose the consumer’s income is between 100% and 250% of the Federal Poverty Level (FPL). In that case, they will get more help from the government to pay deductibles, copays, and coinsurances while using health insurance. This payable amount by the government is a cost-sharing reduction subsidy.
A legal U.S resident can apply for a health insurance subsidy and enroll in a health plan on a health insurance exchange. The federal government or specific state runs the marketplace or insurance exchange. One can find state health insurance exchanges using the HealthCare.gov tool.
Short-term health insurance
Short-term health insurance is quite attractive for people looking for temporary coverage. Typically, it costs less than comprehensive traditional insurance plans. The time limit varies from state to state, as it covers 364 days mainly but can be renewed up to a total of 36 months.
There are more restrictive limits on plan durations in some states, and some do not sell it at all. Insurers offer plans that are non-renewable and have shorter durations. Remember that short-term health insurance plans do not follow the ACA’s rules.
“Short-term health plans” do not cover essential health benefits, including maternity care and mental health care. They do not provide coverage for any preexisting conditions. Some of them even do not offer outpatient prescription drug coverage.
Short-term health insurance can come with low-cost options and is not suitable for everyone, but they place a cap on benefits.
Eligibility for short-term health insurance
To be eligible under short-term health insurance, insurers consider a young, healthy, and seen at risk. Although it is a lower-cost option, understand the post-claim underwritings that the chosen plan covers.
How to buy a short-term plan on an exchange or marketplace?
One can buy a short-term health insurance plan in the following few ways:
- Buy a health insurance policy directly from an insurance company.
- Through insurance agent
- Find an insurance agent or broker through the National Association of Health Underwriters website
- Go for a non-governmental private online exchange.
Short-term health insurance is not on the ACA health insurance exchange as these are not considered minimum essential coverage.
Employer-based health insurance
In the United States, many subsidize health insurance for the employees and their dependents. It is part of employee benefits and compensation packages for full-time employees of large companies.
Employer-sponsored health insurance plans may offer several options you can choose from. The employees have a limited time, so they must sign up before the deadline. Otherwise, they will miss the open enrollment period and wait for the next open enrollment period.
Who will pay for employer-based health coverage?
Usually, the employer has to pay the part of monthly premiums, and the rest the consumer himself pays. In some cases, the employer pays most of the cost, and the premiums consumer shares will be automatically taken out from the paycheck.
The payroll deduction in terms of monthly premiums is made before calculating income taxes. So there is no need to pay tax on health insurance premiums.
With “employer-based insurance,” employers do not pay cost-sharing expenses. But some employers offer their employees saving plans and health reimbursement arrangements. On the other hand, if you lose the job, you will also lose the insurance. However, employees can continue insurance through COBRA or state continuation.
Spouse’s health plan
If you are after how can I get affordable health insurance, a spouse’s health plan is the best option. As most employers extend, job-based health insurance and dependents are eligible for the same coverage.
You can sign up for health coverage even during initial enrollment periods, so you should not wait for the annual open enrollment period. Moreover, you can join your spouse’s plan if there is any qualifying period like having a baby or losing your health plan.
Parents health plan
If any individual is younger than 26 years old and their parents have certain coverage, they will automatically get covered. That particular health insurance plan for parents could be job-based (that offers coverage to dependents), an individual plan purchased on exchange or off-exchange, or a grandfathered or grandfathered plan.
Under a job-based insurance plan, some employers subsidize their employee’s dependents, but some do not subsidize it for family members. If the employer gives the facility for dependents, he will pay for your premiums as well; otherwise, he will take your insurance premiums from your parent’s paycheck.
Individual health insurance
Any individual can opt for such plans by visiting their state or federal marketplace. One can get individual health insurance directly through insurance companies or any broker.
In addition, if you are a student or self-employed, individual health insurance is the best option for you. One can choose a correct option through the marketplace, home to Affordable Care Act (ACA) plans.
Things to consider when seeking for how to find affordable health insurance
Focus on choosing the right type of health plan because this will have a more significant impact on the total costs. Although one can quickly go for a monthly plan with the lowest prices in the long run, it will affect your health benefits. Look into the available options, make their comparison, and choose the best health insurance plan accordingly. Check out the following aspects as well:
Annual costs and premiums
While purchasing health insurance, focus on the annual cost and monthly premiums. At the same time, the premium is the amount the consumer pays every month for health coverage. The government or employer can subsidize the premium amount.
If anyone is looking for a cheap or affordable health insurance plan, there are various ACA plans in the insurance marketplace. Such health insurance plans are separated into four “metal” categories.
Low rates with essential health benefits coverage include prescription drugs, mental health services, and preventive care. The consumer needs to pay the lowest premium every month with a high deductible.
However, it has higher costs when you seek care as it will take more to reach your deductibles. It is the best metal plan if the consumer wants the coverage during worst-case scenarios. Under this plan, usually, health insurance pays 60% of health care costs, and the subscriber will pay the remaining 40%.
The silver plan is more expensive than the Bronze plan as premiums are slightly higher. But it comes with better medical benefits, and the costs will be lower when you seek health care. In such a health insurance plan, the insurer will pay 70% of health costs, and the consumer will contribute the rest, 30%.
One must consider a gold plan if they often visit their physician or need care. It comes with higher monthly premiums with lower care costs. The health insurer will pay 80%, and the consumer will spend the rest, 20%, for coverage.
This plan comes with the highest monthly premium, but it will assure you to cover all minimal point-of-care costs.
Health Savings Account (HSA)
One can reduce overall health costs by saving pre-tax money in a health-specific saving account. After that, one can use these savings to pay deductibles, copays, coinsurances, and medical expenses, although they can not use them to pay monthly premiums.
Flexible Spending Account (FSA)
It is also a benefit provider as it takes the pre-tax amount from the paycheck when you want to use the funds on qualified medical expenses. A significant benefit by the employer alongside health insurance plans. Remember that you have to use the amount by a specific date; otherwise, you will lose it.
Out of network coverage
It is pretty more affordable to see in-network providers than out-of-network providers. If you are planning for out-of-network, go for a preferred provider and visit the preferred facility. Such insurers have a contract with your health insurance plan that will cost more and are the most expensive. But you can opt for a forgiving and flexible plan if it comes to out-of-network coverage.
There are various ways to know how to find affordable health insurance in the United States. Some health insurance plans are free, including Medicaid plans, some are employer-sponsored plans, and some are low-cost marketplace plans. Usually, the employer or government provides a subsidy to cover the total cost of coverage, or consumers pay minimal premiums monthly.
But if you do not get health insurance through work or the government, you have many options to apply for coverage. Do your research, compare available options and then opt for the right health insurance plan. Other plans could have small premiums, but there would be lower-quality benefits.
You have to buy health insurance through the federal exchange or state exchange to be eligible for premium tax credits (subsidies). In addition, buy the insurance policy during the annual open enrollment period to buy the best, most affordable, and comprehensive coverage.