ACA Qualified
Health Insurance Plans
The world of Obamacare is full of helpful and yet confusing acronyms — sort of like the details of the reform itself. There’s ACA, QHP, CHIP, MEC — and the list goes on. However, there’s no reason why you can’t easily understand how the Affordable Care Act (ACA) can work for you and your family’s health.
Since its inception, the Affordable Health Care Act focused on lowering health care costs and providing better medical care for Americans as a whole. So far, the ACA is responsible for a reduction in the rise in health care costs every year. It also increases the number of medical benefits that are “essential” in qualified plans, while reducing the overall ranks of the uninsured.
The world of Obamacare is full of helpful and yet confusing acronyms — sort of like the details of the reform itself. There’s ACA, QHP, CHIP, MEC — and the list goes on. However, there’s no reason why you can’t easily understand how the Affordable Care Act (ACA) can work for you and your family’s health.
What Is a Qualified Health Plan?
It’s very simple — QHP stands for “Qualified Health Plan,” and these are ACA compliant health insurance plans that are certified by the Health Insurance Marketplace as ones that provide the “minimum essential coverage” (MEC). Besides these requirements, QHPs must:
- Follow established limits on cost-sharing (deductibles, co-payments, and out-of-pocket maximum amounts)
- Offer the same set of core benefits, including preventative services, prescription drugs, hospitalization, and more
About 88% of the over 10 million people who already have ACA compliant health insurance receive a federal subsidy for using Qualified Health Plans. These comprehensive plans are broken down into four specific tiers, to help consumers make easy comparisons between cost and coverage.
Bronze
A Bronze QHP must cover 60% of the expected costs for the individual. As such, it’s the plan with the lowest monthly premiums but the highest out-of-pocket costs. It has a very high deductible. If you don’t plan on using many medical services — in other words, you’re young and in relatively good health — the Bronze plan is a smart way to make sure you don’t get taxed for being uninsured under Obamacare.
Silver
These are the most common types of plans and many of the ACA subsidies are based on the cost of a Silver plan. While it’s true that premiums on the lowest-cost Silver plans on health insurance exchanges are up an average 35%, many individuals also qualify for the ACA subsidies, which can help offset costs.
88% of individuals who use the health marketplace already qualify for a tax credit to buy ACA plans so this is good news. On a Silver QHP, individuals pay moderate premiums and moderate out-of-pocket costs. The deductibles are, of course, lower than the Bronze plans.
Gold
Gold QHPs have high monthly premiums but also feature lower out-of-pocket costs. The deductibles are low, and their cost is sometimes far more than a Silver plan. However, this depends on your county and state of residence. While the upfront cost is high, the amount you have to shell out when you receive care is relatively low. So, if you have multiple medical conditions, this might be the right option for you.
Platinum
As the name suggests, Platinum plans are the very top-of-the-line QHPs available under the Affordable Care Act. These plans work hard for those who expect to use the full range of medical care services and frequently. The high monthly premiums keep your out-of-pocket costs very low, along with low deductibles. Again, if you qualify for subsidies, this may make a Platinum, or even a Gold QHP, a more cost-effective solution for your healthcare.
What Do Qualified Health Plans Cover?
ACA Qualified Health Plans all have a standard set of services and medical provisions they must cover, known as Essential Health Benefits (EHB). This is an ACA requirement that QHPs must meet. All plans have these 10 provisions:
- Ambulatory outpatient services
- Emergency services
- Hospitalization, including surgeries and overnight stays
- Pregnancy, maternity, and newborn care (including birth control and breastfeeding)
- Mental health and substance use disorder care (including behavioral health treatments, counseling, and psychotherapy)
- Prescription Medication
- Rehabilitative services
- Lab services
- Preventive
- Pediatric services including oral and vision
These are the details on the services and provisions of ACA compliant health insurance plans. However, QHPs are also known as such for the other aspect of health insurance: costs. Besides meeting coverage for essential benefits, which you can think of as a baseline, QHPs must also meet maximum (or “upper” ceiling) limits on deductibles, out-of-pocket costs, and copays.
Out-of-Pocket Costs
Every QHP is based on cost-sharing between insurers and individuals. Out-of-pocket expenses are your portion of what you’re responsible for paying when you receive healthcare. However, these are not to be confused with monthly health insurance premiums. These can be in the form of copay, coinsurance, or deductibles.
Bronze QHPs with low monthly premiums are also the ones with the highest out-of-pocket costs because the idea is that if you’re opting to reduce the amount you pay each month, you’re saying that you have the capacity to pay out of pocket to a greater degree. Perhaps that’s because you’re not anticipating using healthcare services very frequently, so shelling out a greater amount once or twice is financially feasible for you.
Deductibles
Health insurance deductibles are the amount of money you must first pay before the insurance company starts paying its share of costs. For example, a QHP with a $2,000 deductible means that you would have to pay for $2,000 worth of healthcare provisions before your insurance kicks in and pays its share.
Copayment - Coinsurance
Copays are based on the health care service. For example, a doctor’s visit might have a $25 copay while an emergency room visit may have a $250 copay. Copays are usually in lieu of the deductible for certain medical services.
Coinsurance is the amount you must pay in addition to your deductible in order to reach your Out of Pocket. Now it’s important to note that these out-of-pocket expenses have maximums. Recent changes made to ACA means that some insurers could offer non-compliant health plans that do not cover all 10 essential benefits, such as maternity and mental health.
Open Enrollment Periods
Every year, the health markets open for enrollment from November 1st through December 15th. Dates can vary by year and even by state. There is also a Special Enrollment Period where individuals who qualify by means of a major, life-changing event. Events include loss of job, the arrival of a new baby, or marriage. Individual applicants qualify to keep their plans intact but they can make changes and additions even after official open enrollment has closed down.
Conclusion
Health insurance plans in the United States place a great responsibility on the shoulders of the individual. It’s up to you to do the research and understand the difference between ACA compliant health plans and non-ACA compliant health plans, assess your own financial and health situation, and make the right choice.
However, choice is at the heart of the American healthcare system. The combination of insurance sources, insurance plan types, and insurance providers, along with supplemental coverage, gives American consumers a granular level of control on their health and well-being, and the associated costs. You’re also not fixed to a plan since you can make a different choice from year to year, every year.
At Nerdy Insurance Agency, we’re committed to simplifying the process of finding and enrolling in the right health insurance plan for you. From qualified health plans to non-qualified options, we help our clients access affordable health care that suits their changing lives and needs in an ongoing and informative way. Find out more about our streamlined enrollment process and get updated details on curated plans for you and your family at Nerdy Insurance Agency.
Find the Right Plan Today
If you’re trying to stay within budget while finding the right coverage, then you already know that it can be an overwhelming process. The good news is that Nerdy Insurance Agency can do the work of searching for the right plan for you. Nerdy Insurance Agency is an affordable exchange where you can browse for qualified and non-qualified plans so you can find the right coverage at the right price. Find your new policy today.