Are you ready? Here it comes. The Health Insurance marketplace is set to begin tomorrow. In advance of the rollout, the Department of Health and Human Services recently released the premiums — or monthly costs — for health insurance for 2014.
Costs will vary according to where people are located in the country, family size, income, and tobacco use. How does it work? How can you get the best deal? And how much can you expect to pay out of pocket?
Categories of Insurance
First let’s talk metals. Insurance categories are classified by metals: bronze, silver, gold, and platinum. There is an additional category called catastrophic. Bronze is the least expensive while gold is the most. It is important to note that the categories are not about quality of care. It’s about what you will pay in premiums every month, how much money you will pay out of pocket for hospital visits or prescriptions, and how much you will pay total over the year if you have a lot of health care costs. Catastrophic plans are also available for people under the age of 30 and select people with very low incomes.
The best deal for you
More choices equal better savings. The US Department of Health and Human Services did an analysis of 36 state marketplaces. According to an issue brief from DHHS, individuals and families will have an average of 53 health plans to choose from when looking for a plan. Young adults will have an average of 57 choices. Also, on average, there are eight different health insurance carriers participating in each of the 36 marketplaces from the analysis. The greater the competition the more the consumer saves.
When it’s time to select a metal level, consider how you use health insurance. If you are a relatively healthy person who doesn’t anticipate many doctor visits or take medications routinely, you may want to consider the bronze level or silver level. However, these levels carry a lower premium, or cost per month. If an accident occurs, you can expect to pay more out of pocket later for care. If you anticipate many doctor visits or take regular prescriptions, gold or platinum may be the choice for you. The premium is higher in these categories, but you pay less at the doctor’s office and for prescriptions.
Prices, Premiums, and Plans
Prices for basic health coverage will vary from person to person. Gary Cohen, director of the Center for Consumer Information and Insurance Oversight stated on a conference call that people who are uninsured and qualify for financial assistance or Medicaid could end up paying less than $100 a month per person for health insurance.
The premium that you pay will depend on the category you pick, your family size, and other factors such as where you live. For example, a 27-year-old in Atlanta, Georgia who earns $25,000 and chooses the lowest level Bronze category can expect to pay $105 per month after tax credit. A family of four — two adults and two children under the age of 18 — in Atlanta with an income of $50,000 in the lowest Bronze category would pay $138 per month after Tax Credit. A 27-year-old in Philadelphia, Pennsylvania who earns $25,000 and chooses the lowest level in the Bronze category will pay $94 per month after Tax Credit. A family of four in the same city earning $50,000 would pay $96 a month in the lowest Bronze category after tax Credit.
Where do you begin?
On October 1st, you will be able to log on to your state’s health department website and create an account. Then you will enter information about you and your family, income, household size, and other pertinent information. Next, based on the information you enter you will be able to see plans that apply to your situation. You will be able to compare premiums and out-of-pocket costs side by side. Pick the plan that best suits your needs and enroll. Your coverage will go into effect on January 1, 2014.
You have time to make a decision so think it through. The marketplace will remain open until March 31, 2014. Take your time and choose wisely. Review your budget and decide what you can afford. Shop around. Ask questions. Most of all don’t be afraid to ask for help. The government may have established the marketplace but it puts the power of obtaining affordable healthcare coverage in the consumer’s hands.
For more information about healthcare marketplaces, visit www.healthcare.gov.
Candace Y.A. Montague is a freelance health writer based in Washington, DC. She is a regular contributor to TheBody.com, Black AIDS Weekly, and East of the River Magazine, a publication under Capital Community News.