How to Find Affordable Health Insurance on the Marketplace

With medical costs on the rise, a single health emergency can cause significant financial hardship if you're uninsured. In 2022, 92.1% of Americans had health insurance at some point, up from 91.7% in 2021, reflecting the growing awareness of the importance of being insured.

The Affordable Care Act (ACA), commonly known as Obamacare, transformed access to health insurance in the US by introducing the Health Insurance Marketplace. This platform allows individuals and families to compare and purchase insurance plans that suit their needs and budget.

Finding affordable health insurance on the Marketplace can be tricky. This guide is here to help you navigate the process and find the best options for you.

Understanding the Health Insurance Marketplace

The Health Insurance Marketplace is a platform accessible in every state, allowing individuals, families, and small businesses to browse and buy health insurance plans.

The ACA created the Marketplace to increase the number of insured Americans, reduce healthcare costs, and eliminate discriminatory practices in the insurance industry, such as denying coverage based on pre-existing conditions.

There are three types of Marketplaces:

• State-based Marketplaces (SBM): Some states operate their own Marketplaces. These states handle the entire process independently without relying on the federal government's platform. Examples include Covered California and the New York State of Health.
• Federally-facilitated Marketplace (FFM): In states that do not operate their own Marketplaces, residents use the federal Marketplace, accessible through HealthCare.gov.
• State-based Marketplace-Federal Platform (SBM-FP): These states are responsible for most marketplace functions. However, they delegate the eligibility and enrollment processes to the federal platform.

Anyone can buy a health insurance plan through the Marketplace, provided you meet certain criteria. Specifically, you must:

1. Be a US citizen or lawfully present in the US.
2. Not be currently incarcerated.
3. Live in the United States.
4. Not have Medicare coverage.

Health Plan Categories on the Marketplace

Marketplace plans are categorized into four classes based on their actuarial value–Bronze, Silver, Gold, and Platinum. The actuarial value indicates the percentage of healthcare costs a plan is projected to cover for an average group of enrollees.

• Bronze: These plans cover approximately 60% of healthcare costs. They have the lowest monthly premiums but come with the highest out-of-pocket expenses.
• Silver: These plans cover about 70% of healthcare costs. They are moderate in both premiums and out-of-pocket costs.
• Gold: These plans cover around 80% of healthcare costs. They have higher premiums but lower out-of-pocket costs.
• Platinum: These plans cover roughly 90% of healthcare costs. They have the highest premiums but the lowest out-of-pocket costs.

Moreover, there is a fifth category called catastrophic plans, available to individuals under 30 and certain people with limited incomes.

These categories do not reflect the quality of care you receive. Instead, the categories mainly differ in how costs are shared between you and the plan for covered services.

Types of Health Plans on the Marketplace

In addition to categories, there are also different types of plans available on the Marketplace. Examples are:

• Exclusive Provider Organization (EPO): Services are covered only if you use doctors, specialists, or hospitals within the plan's network, except in emergencies. No referrals are needed for specialists, but you must stay in-network for coverage.
• Health Maintenance Organization (HMO): Typically limits coverage to doctors and hospitals within its network, generally not covering out-of-network care unless it's an emergency. You may need to live or work in the plan's service area, with a strong focus on preventive care.
• Point of Service (POS): Offers lower costs for in-network care but requires a referral from your primary care doctor to see a specialist. Out-of-network care is available but at a higher cost.
• Preferred Provider Organization (PPO): Allows you to see any doctor or specialist without a referral, with lower costs for in-network providers. You can use out-of-network services, though at an additional cost.

Each of these plan types has its own advantages and trade-offs, so it's important to choose one that best fits your healthcare needs and budget.

When to Enroll in a Marketplace Plan

The primary period to enroll in a Marketplace plan is during the Open Enrollment Period (OEP). This period typically occurs from November 1 to January 15 each year. During OEP, anyone can sign up for a new plan or change their existing plan.

Special Enrollment Periods (SEPs) allow for enrollment outside of OEP under certain circumstances, such as:

• Loss of other health coverage (e.g., losing job-based insurance)
• Change in household (e.g., marriage, birth of a child)
• Change in residence
• Other qualifying events, such as gaining citizenship or being released from incarceration

How to Find Affordable Health Insurance on the Marketplace

Finding affordable health insurance requires comparing the options available to you. Here’s a step-by-step guide to navigating the process:

1. Gather Information About Your Health Needs

Before you start looking at plans, assess your healthcare needs. Consider:

• How often you visit the doctor
• Any ongoing health conditions
• Prescription medications you take
• Anticipated surgeries or treatments

Having a clear picture of your needs will help you choose a plan that minimizes your overall healthcare costs.

2. Use the Marketplace Calculator

The Health Insurance Marketplace Calculator estimates your eligibility for subsidies. By entering your income, household size, and location, the calculator will estimate the amount of financial assistance you qualify for and the cost of available plans.

3. Compare Plans Based on Total Costs

When comparing plans, you need to consider the plan's total cost. These are:

• Premiums: The amount you pay monthly for your health insurance.
• Deductibles: The amount you must pay out-of-pocket before your insurance begins to cover expenses.
• Copayments and Coinsurance: Your share of the costs for covered services after you’ve met your deductible.
• Out-of-Pocket Maximums: The maximum amount you'll need to pay in a year for covered services. After reaching this limit, your insurance will cover 100% of the costs for covered services.

The Marketplace makes it easy to compare these costs side by side. To preview plans and prices:

• Select "Add yearly cost" on any listed plan.
• Choose the expected level of care for the year.
• Click "Save and continue" to see your estimated total yearly costs for each plan.

Your actual costs will depend on the services you use, but this estimate can give you a clearer picture of how each plan might impact your budget.

Additionally, consider plans labeled with "easy pricing." These plans have standardized out-of-pocket expenses and cover certain services before you meet your deductible. This means you’ll pay the same amount for specific services regardless of the plan you choose, and some services might be covered without first meeting your deductible. Essentially, these plans make it easier to predict and manage your healthcare expenses.

4. Check Provider Networks and Drug Coverage

Make sure that your chosen plan includes your preferred doctors, hospitals, and specialists within its network. Also, check that it covers your prescription medications. Using out-of-network providers or paying out-of-pocket for drugs not covered by your plan can significantly increase your healthcare costs.

5. Consider a Health Savings Account (HSA) Eligible Plan

If you’re considering a high-deductible health plan (HDHP), check if it’s HSA-eligible. Contributions to your HSA reduce your taxable income, and withdrawals for eligible medical expenses are exempt from taxes.

HSAs can be a great way to save money, especially if you’re generally healthy and don’t expect to need much care. When comparing plans on HealthCare.gov, you can filter for HSA-eligible options by clicking "Add filters" at the top left and selecting "Eligible for an HSA."

6. Apply for Financial Assistance

The ACA offers two main types of financial assistance for those who qualify:

• Premium Tax Credits: These reduce the amount you pay for your monthly premium. You can apply these credits directly to your premium payments or claim them when you file your taxes.
• Cost-Sharing Reductions (CSRs): These reduce out-of-pocket costs (like deductibles and copayments) for those with incomes up to 250% of the FPL. CSRs are only available with Silver plans.

Applying for financial assistance can significantly reduce the cost of your health insurance.

How to Maximize Your Savings on the Marketplace

Aside from selecting the right plan and applying for financial assistance, there are several strategies you can use to save money in the Marketplace:

1. Update Your Information Regularly

Life changes can impact your eligibility for financial assistance. If your income, household size, or employment status changes, update your information on the Marketplace. This ensures you receive the correct amount of subsidies and avoid owing money at tax time.

2. Reevaluate Your Plan Annually

Health needs and Marketplace offerings change from year to year. During each Open Enrollment Period, review your current plan and compare it with new offerings. Even if you’re satisfied with your current coverage, you may find a plan that better meets your needs or costs less.

3. Consider a Catastrophic Plan if Eligible

If you’re under 30 or qualify for a hardship or affordability exemption, you may apply for a catastrophic plan. These plans have very low premiums and very high deductibles. They’re designed to protect you from worst-case scenarios, like serious accidents or illnesses, but may not cover routine care until you meet your deductible.

Catastrophic plans offer the same ten essential health benefits as other Marketplace plans, including free preventive services. Additionally, they cover a minimum of three primary care visits per year, even before you've met your deductible.

4. Take Advantage of Preventive Care Services

All Marketplace plans are required to cover specific preventive services (vaccines, screenings, and annual check-ups) without charging you a copayment or coinsurance. Make sure you take advantage of these services, as they can help you detect health issues early and prevent the need for more expensive treatments later on.

Mistakes to Avoid When Shopping for Marketplace Insurance

The Marketplace can be confusing, especially for first-time buyers. Here are some common mistakes to avoid:

• Focusing Only on Premiums: While low premiums are attractive, they often come with higher out-of-pocket costs. Always consider the total cost of the plan.
• Not Checking the Provider Network: If you have a preferred doctor or hospital, make sure they’re in the plan’s network. Care received outside the network can be considerably more costly and may not count toward your out-of-pocket maximum.
• Ignoring Prescription Drug Coverage: Check that the plan covers your prescription medications. Formularies (the list of covered drugs) vary between plans, and some plans may not cover the medications you need.
• Overlooking Special Enrollment Periods: If you experience a life change, such as marriage or job loss, you may qualify for a Special Enrollment Period. Missing this window means you’ll have to wait until the next Open Enrollment Period to get coverage.
• Not Applying for Financial Assistance: Even if you think you don’t qualify, it’s worth applying for financial assistance. Many people are surprised to find they qualify for premium tax credits or cost-sharing reductions, which can make health insurance more affordable.

How to Get Help with the Marketplace

If you find the process of selecting a health insurance plan on the Marketplace overwhelming, several resources are available to help:

1. Navigators and Assisters: These are trained professionals who can help you understand your options, apply for coverage, and enroll in a plan. Their services are free and available in every state.
2. Brokers and Agents: Licensed health insurance agents and brokers can also help you find and enroll in a plan. Unlike Navigators, they can recommend specific plans, but they may receive a commission from insurers.
3. Marketplace Call Center: The Federal Marketplace has a call center that can answer your questions and help you apply over the phone. You can reach them at 1-800-318-2596 (TTY users can call 1-855-889-4325). They're available 24/7, except for holidays.
4. Local Community Health Centers: Many community health centers offer assistance with health insurance enrollment.

Final Words

Finding affordable health insurance on the Marketplace can be easier than you think. By knowing the types of plans, estimating your total costs, and using financial assistance, you can choose a plan that fits your health needs and budget.

Review your plan each year to ensure you’re still getting the best coverage at the right price. Follow this guide to explore your options and secure coverage that fits your needs and budget.

How to Maximize Your Savings on the Marketplace

Aside from selecting the right plan and applying for financial assistance, there are several strategies you can use to save money in the Marketplace:

1. Update Your Information Regularly

Life changes can impact your eligibility for financial assistance. If your income, household size, or employment status changes, update your information on the Marketplace. This ensures you receive the correct amount of subsidies and avoid owing money at tax time.

2. Reevaluate Your Plan Annually

Health needs and Marketplace offerings change from year to year. During each Open Enrollment Period, review your current plan and compare it with new offerings. Even if you’re satisfied with your current coverage, you may find a plan that better meets your needs or costs less.

3. Consider a Catastrophic Plan if Eligible

If you’re under 30 or qualify for a hardship or affordability exemption, you may apply for a catastrophic plan. These plans have very low premiums and very high deductibles. They’re designed to protect you from worst-case scenarios, like serious accidents or illnesses, but may not cover routine care until you meet your deductible.

Catastrophic plans offer the same ten essential health benefits as other Marketplace plans, including free preventive services. Additionally, they cover a minimum of three primary care visits per year, even before you've met your deductible.

4. Take Advantage of Preventive Care Services

All Marketplace plans are required to cover specific preventive services (vaccines, screenings, and annual check-ups) without charging you a copayment or coinsurance. Make sure you take advantage of these services, as they can help you detect health issues early and prevent the need for more expensive treatments later on.

Mistakes to Avoid When Shopping for Marketplace Insurance

The Marketplace can be confusing, especially for first-time buyers. Here are some common mistakes to avoid:

• Focusing Only on Premiums: While low premiums are attractive, they often come with higher out-of-pocket costs. Always consider the total cost of the plan.
• Not Checking the Provider Network: If you have a preferred doctor or hospital, make sure they’re in the plan’s network. Care received outside the network can be considerably more costly and may not count toward your out-of-pocket maximum.
• Ignoring Prescription Drug Coverage: Check that the plan covers your prescription medications. Formularies (the list of covered drugs) vary between plans, and some plans may not cover the medications you need.
• Overlooking Special Enrollment Periods: If you experience a life change, such as marriage or job loss, you may qualify for a Special Enrollment Period. Missing this window means you’ll have to wait until the next Open Enrollment Period to get coverage.
• Not Applying for Financial Assistance: Even if you think you don’t qualify, it’s worth applying for financial assistance. Many people are surprised to find they qualify for premium tax credits or cost-sharing reductions, which can make health insurance more affordable.

How to Get Help with the Marketplace

If you find the process of selecting a health insurance plan on the Marketplace overwhelming, several resources are available to help:

1. Navigators and Assisters: These are trained professionals who can help you understand your options, apply for coverage, and enroll in a plan. Their services are free and available in every state.
2. Brokers and Agents: Licensed health insurance agents and brokers can also help you find and enroll in a plan. Unlike Navigators, they can recommend specific plans, but they may receive a commission from insurers.
3. Marketplace Call Center: The Federal Marketplace has a call center that can answer your questions and help you apply over the phone. You can reach them at 1-800-318-2596 (TTY users can call 1-855-889-4325). They're available 24/7, except for holidays.
4. Local Community Health Centers: Many community health centers offer assistance with health insurance enrollment.

Final Words

Finding affordable health insurance on the Marketplace can be easier than you think. By knowing the types of plans, estimating your total costs, and using financial assistance, you can choose a plan that fits your health needs and budget.

Review your plan each year to ensure you’re still getting the best coverage at the right price. Follow this guide to explore your options and secure coverage that fits your needs and budget.

What should I do if my income changes during the year?

You should update your Marketplace application as soon as possible. A change in income can affect your eligibility for subsidies. Reporting income changes promptly helps ensure that you receive the appropriate assistance and avoid having to pay back excess subsidies at tax time.

Can I cancel my Marketplace health insurance plan at any time?

Yes, you can cancel your Marketplace health insurance plan at any time. However, it's important to consider the implications of being uninsured, such as the potential for high out-of-pocket costs in case of a medical emergency and the inability to enroll in a new plan until the next Open Enrollment Period, unless you qualify for an SEP.

How does the Marketplace determine which plan is the best fit for me?

The Marketplace provides tools that allow you to compare plans based on factors like monthly premiums, out-of-pocket costs, and coverage details. You can input your estimated healthcare needs, such as the frequency of doctor visits and prescription drug usage, to see how different plans will affect your total annual healthcare costs. The Marketplace also factors in whether your preferred doctors and medications are covered under each plan, helping you make a more informed decision.

Can I change my Marketplace plan after I've enrolled?

You can only change your Marketplace plan during the Open Enrollment Period or if you qualify for a Special Enrollment Period. If you don't have an SEP, you’ll need to wait until the next Open Enrollment Period to change your plan.

Are dental and vision insurance included in Marketplace plans?

Adult dental and vision insurance are not automatically included in most Marketplace health plans. However, you can purchase separate dental and vision insurance plans through the Marketplace. Some Marketplace health plans do include pediatric dental and vision coverage as part of the essential health benefits for children under 18.