ichigan's Health Insurance Marketplace, which opened Oct. 1, is a new way to buy health insurance. It's a one-stop shop where you can compare plans and choose the one that is best for you and your family. Here's a look at why it was created, how it works and what it offers.
Why a health insurance marketplace?
As part of the health care law, each state is required to provide access to an online marketplace for buying health insurance. States were given the option to build and operate their own marketplace, partner with the federal government or allow the federal government full administrative control over the marketplace.
Michigan was originally planning for a state-run or partnership-run marketplace, but defaulted to a federal government-run marketplace after those plans failed to win legislative approval. In the future, a state-run marketplace may be developed.
Marketplaces are designed for people who do not have insurance and those who buy their own insurance. As of Oct. 1, 2013, about a million uninsured Michiganders were able to purchase health insurance through the marketplace, located at HealthCare.gov. The 86 percent of Michiganders who already have coverage will not need to use the marketplace. Most Michiganders will continue to get insurance through their jobs, not via the marketplace. If you already have qualifying insurance and are happy with your plan, you don't need to use the marketplace.
How to use it
To choose a health insurance plan through the new Health Insurance Marketplace, go to HealthCare.gov and select "Get Insurance." From there, you'll be asked to select your state and then you'll be on your way to answering questions and getting answers on the type of insurance plans that are available to you. The marketplace operates similar to websites that compare travel costs or car insurance. You will be able to comparison shop between qualified health care plans and use a price calculator to find the best one for you and your family. You'll also find out if you are eligible for discounts or government-subsidized health programs like Medicaid.
If you enroll in a plan before Dec. 15, your coverage will kick in on Jan. 1, 2014. Open enrollment will close March 31, 2014. If you have not purchased insurance at that time, you will have to wait for the next enrollment cycle to obtain coverage through the marketplace and may have to pay a tax penalty. For 2014, the penalty will be a fixed $95 or 1 percent of your total income, whichever is greater.
Certain life events may qualify you to purchase coverage through the marketplace outside the normal enrollment period. These are:
- moving to a new state
- certain changes in your income (such as losing your job)
- changes in your family size (for example, if you marry, divorce or have a baby)
Plans available through the marketplace
The Health Insurance Marketplace will offer plans from several insurance companies that provide different levels of coverage. These tiered plans will have some standardized costs and benefits; the difference is how much health care a plan will cover before the patient must chip in for cost-sharing measures like deductibles and copayments. "Higher" plans will have a higher premium – the amount you pay to the insurance company every month – and will include more generous coverage. "Lower" plans will have a lower premium and will come with more costs for you to pay out-of-pocket when you need health care. Here's a breakdown of the different plans offered and the amount of health care costs they'll cover for the average applicant:
- Bronze: 60 percent
- Silver: 70 percent
- Gold: 80 percent
- Platinum: 90 percent
There is also a bare-bones plan that offers "catastrophic" coverage for those under age 30.
Insurers are not required to offer plans on the marketplace, but those who do are required to offer at least one silver and one gold plan. All plans are required to cap a patient's out-of-pocket costs at a specified amount. No plan can apply out-of-pocket costs for preventative health measures.
Insurers can still sell health care plans outside the marketplace. You can still purchase insurance through an insurance agent or broker, although those plans won't be eligible for tax credits or subsidies available through the marketplace.
The cost of health care
How much you pay for health insurance will depend on your income and the type of plan you choose. People who earn less than 400 percent of the federal poverty level may be eligible for tax credits or subsidies to help with the cost of insurance. Some will be eligible for government programs such as Medicare, Medicaid and the Children's Health Insurance Program, or CHIP – called MIChild in Michigan. (For information on costs and options for low-income, uninsured families, see the "I Don't Have Insurance" section)
To get specific pricing numbers on the insurance plans available through Michigan's Health Insurance Marketplace, visit HealthCare.gov.
What the plans must cover
In order to qualify to be sold through the marketplace, plans on all four "medal" levels must include a package of essential benefits, effective Jan. 1, 2014. Those benefits are:
- Ambulatory patient services (care you receive without being admitted to a hospital; for example, at a clinic or doctor's office)
- Emergency services
- Maternity and newborn care
- Mental health and substance use disorder services (including behavioral health treatment)
- Prescription drugs
- Rehabilitative and habilitative services and devices
- Laboratory services
- Preventative and wellness services, chronic disease management
- Pediatric services, including oral and vision care
AARP, American Public Health Association, Centers for Medicare & Medicaid Services, Consumer Reports, FAIR Health, Inc., HealthCare.gov, Internal Revenue Service, Kaiser Family Foundation, Medicaid.gov, Michigan Department of Community Health, Michigan Department of Insurance and Financial Services, U.S. Chamber of Commerce, U.S. Department of Health and Human Services, U.S. Department of Veterans Affairs.
Every effort was made to provide clear, accurate information about health care reform. We verified any information we had with first-tier sources – those who are involved in this change and its effect on our health care system. We also relied on well-respected national nonprofits, some who've done a masterful job of providing clear information to consumers. Our primary source of information was the Affordable Care Act's official website, HealthCare.gov. If you need additional information about how health care reform affects you, that would be your best place to start.