The Obamacare exchanges will reopen Saturday for year two of the Affordable Care Act’s open enrollment period. This year, the shopping season has been trimmed back to three months — it ends February 15, 2015 (unless you have a “special qualifying event,” such as a marriage or loss of health coverage, allowing you buy up to 60 days after that).
So if you plan to shop for 2015 coverage for yourself, your family or your adult child 26 or older (I’ll be in the latter category), you’ll probably need to act pretty quickly.
(MORE: 10 Things Your Health Insurer Won't Tell You)
I have three tips:
1. Start window-shopping now at Healthcare.gov. The once-maligned, but now improved, federal site lets you see what your options will be. You can’t buy coverage until after open enrollment begins on Saturday, though.
First, you type in your ZIP code; anticipated 2015 household income; age; and whether you are a smoker, a parent or pregnant. Then, you’ll see if you’ll likely qualify for a federal subsidy. Next, you can search for coverage five different ways:
- Premium cost
- The “metal” type of plan (bronze, silver, gold or platinum; the more valuable the metal, the better and more expensive the coverage)
- Plan type (a Health Maintenance Organization or HMO; a Point of Service plan or POS — a combination of an HMO and a Preferred Provider Organization or PPO plan or an Exclusive Provider Organization or EPO, where you must use in-network health care providers)
- Health insurer
- Medical management program (such as one you might use if you have diabetes or heart disease or low back pain)
2. Consider working with a health insurance broker. Such a pro might be able to help you find more appropriate, and perhaps less expensive, coverage than you’d find shopping the federal or state health exchanges.
“The only compelling reason for an individual to go to the dysfunctional ecommerce experiment [what you and I call the exchanges] is if you’ll be below 400 percent of the poverty level and will qualify for a subsidy,” says Will Donahoe, President of CBIZ-M.T. Donahoe and Associates, an employee benefits General Agent in Columbia, Md. “A broker is well-equipped to discern what your needs are.”
A broker might give you access to many more plans than what you’d see on the exchanges. In Maryland, for instance, The CareFirst BlueCross BlueShield health insurer offers 12 plans on the state exchange and another 25 to 30 more off-exchange, says Donahoe. “You get a lot more choice with a broker,” he says.
To find a health insurance broker selling coverage in your area, go to the National Association of Health Underwriters site and use its directory.
Alternatively, Donohoe says, you could go the do-it-yourself route and shop for coverage on and off the exchanges at an online health insurance portal such as GoHealth or eHealth.
(MORE: Planning for Retirement Health Costs)
3. Avoid owing the now-much-steeper penalty for not having health insurance. This year, if you didn’t have health insurance, you’d generally owe a penalty of just $95 per person or 1 percent of your modified adjusted gross income, whichever was higher. But for 2015, the penalty will triple. “The penalty for 2015 will be a lot more than many people think,” says Laura Adams, Senior Analyst at InsuranceQuotes.com.
Next year, the penalty will rise to $325 per person or 2 percent of income, whichever is higher. For a family of four with household income of $75,000, the penalty would be $1,110 — up from $550 this year. (You might be exempt from the penalty if the most affordable health coverage will cost you more than 8 percent of your household income.)
This year, individuals and families with income under about $48,750 will pay a flat dollar penalty amount if they don’t buy minimum essential coverage; those with higher incomes will be charged the 2-percent-of-income penalty.
Calculating the exact size of your penalty is a little tricky. But InsuranceQuotes.com has a handy Obamacare penalty calculator that does the work for you.
Think the penalty is still a small price to pay compared with the cost of health insurance? Quite a few people do. A Princeton Survey Research Associates International survey last year found that 4 out of 10 Americans said they’d rather pay the penalty than buy health insurance.
Frankly, that’s nutty. “It’s always better to have insurance, or you could be financially devastated if you have a health problem,” says Adams.
And if you do buy health insurance during Obamacare open enrollment, be certain it meets the Affordable Care Act’s 10 minimum coverage requirements. “If it doesn’t, you could still be subject to the penalty,” says Adams.
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