Starting in the year 2014, the Affordable Care Act (ACA) requires each state to establish its own online health insurance marketplace where people can buy healthcare insurance coverage. This health insurance marketplace is also known as a health insurance exchange. The health insurance marketplace is simply a new place to shop for health insurance, although you still can buy health insurance privately. However, those that qualify for ACA financial assistance must purchase insurance through health insurance exchanges to receive financial benefits under the program.
It is expected that health insurance exchanges will improve the health care system through an increased number of available health plans, standardization that will allow easy plan comparison, and improved consumer protection. By 2019 about 25 million people are expected to use the health insurance marketplace to get health insurance. This number consists of 16 million uninsured people and 9 million people from the private and employer-based insurance markets.
There are Health Insurance Marketplaces (Exchanges) for Individuals and Small Business Health Options Program (SHOP) exchanges. They may be separate or combined.
You may use the marketplace in person, through the mail, phone, or via a web portal. The health plan information includes availability, covered benefits, premiums, cost-sharing, provider network, and medical loss ratio. An online calculator is available to determine the actual insurance cost.
Major Functions of the Health Insurance Marketplace
The major functions of a Marketplace include:
- Certifying health plans to participate in a Marketplace as QHPs
- Determining individuals’ eligibility for
- Enrollment in a QHP
- Enrollment in Medicaid and/or Children’s Health Insurance Program (CHIP)
- Premium Tax Credit and Cost-Sharing Reductions
- Facilitating enrollment in QHPs
- For individuals
- For employers and employees (through SHOP)
The Marketplace benefits include:
- A place for individuals and small employers to easily compare and purchase private health plans, known as Qualified Health Plans (QHPs)
- Simplified search for Health Insurance
- Clear options with apples-to-apples comparisons by price, benefits, quality, and other factors
- Information on plan premiums, deductibles, and out-of-pocket costs is available before you decide to enroll
- One process to determine eligibility for
- Qualified Health Plans (QHPs)
- Medicaid and/or the Children’s Health Insurance Program (CHIP)
- Premium Tax Credits AND Cost-Sharing Reductions
- A break in costs for most people who are applied, including 90% of people who are currently uninsured
To use Health Insurance Marketplace, a qualified individual must:
- Be a U.S. citizen or national (or a lawfully present non-citizen), AND
- Be a resident of the state where he or she will apply for coverage and enroll in a Qualified Health Plan (QHP), AND
- Not be incarcerated, other than incarceration pending the disposition of charges
While any eligible individual may apply for QHP coverage through the Marketplace, QHPs are generally not intended for individuals who are eligible for or enrolled in other types of minimum essential coverage, such as:
- Affordable employer-based coverage
( Employer-based coverage is not considered affordable if:
- coverage through your employer costs more than 9.5% of your income, OR
- your employer’s plan does not pay at least 60% of covered health care expenses)
- Coverage through Medicaid, CHIP, TRICARE, and certain other types
- Medicare coverage
(It is against the law to sell a Marketplace plan to an individual who has Medicare coverage)
- Small businesses may buy health insurance for their employees through the Small Business Health Options Program (SHOP). In order to qualify, companies must have 50 or fewer full-time equivalent employees.
- There should be at least one eligible employee on the payroll
- The employer will access the SHOP where its principal business office is located
- The employer MUST offer coverage to all full-time employees
- Any business with less than 50 employees is exempt from penalty for not offering employee health insurance.
Qualified Health Plans (QHPs) and the Five Levels of Coverage
With the Health Insurance Exchange, individuals and small businesses may buy only high-quality, health plans, known as Qualified Health Plans (QHPs). All plans are from private insurance carriers. There are no government-run health insurance plans offered by the Exchange.
- Must include Essential Health Benefits
- Must adhere to Cost-sharing and Out-of-pocket limits
- Must belong to one five Plan Levels of Coverage: four “metal levels” plans and catastrophic plans
Even though Qualified Health Plans are standardized and share the common levels of coverage, they can vary. For example:
- Some plans may cover additional benefits
- You may have to see certain providers or use certain hospitals
- The premiums, copays, and coinsurance will be different in different plans
- The quality of care can vary
- Some plans will be structured differently, like high-deductible plans
Affordable Health Insurance Options
To help low- and moderate-income families to reduce the cost of health insurance, the federal government provides two affordability programs:
Both of them are available only through the Marketplace when you enroll in one of the metal levels of Qualified Health Plans (QHP). It is assumed that you are not eligible for other minimum essential coverage, such as affordable employer-sponsored coverage, Medicaid, CHIP, and Medicare.
How is an Application Processed in the Marketplace?
The Marketplace application is processed as follows:
- The streamlined application is submitted
- You can apply online, by phone, via mail or in person
- A streamlined application allows consumers to receive a determination for all programs they are eligible for from a single application
- The information needed to determine eligibility is verified
- If there are inconsistencies between the consumer’s application and the information contained in the approved electronic sources, the Marketplace produces an initial eligibility notice that includes a list of any inconsistencies, along with instructions regarding how they can be resolved. The most common types of inconsistencies are income, citizenship, and immigration status.If the Marketplace needs additional information regarding citizenship or immigration status, it establishes eligibility based on the individual’s attestation in those areas for a period of 90 days, during which it will use the individual’s attestation to establish eligibility.
- The marketplace determines eligibility and notifies individual
- You may be determined to be eligible for Medicaid, or the Children’s Health Insurance Program (CHIP), OR
- You may be determined to be eligible for Qualified Health Plan QHP in the Marketplace
- Your eligibility for the Premium Tax Credit is checked
- Your eligibility for Cost-Sharing Reduction is checked
- Depending on the individual’s determined eligibility, the individual
- Enrolls in Medicaid/ CHIP, OR
- Completes the plan comparison, selection, and enrollment process for Qualified Health Plan (QHP)
Each state determines how its marketplace will be set up. There are three marketplace model options:
- State-Based Marketplace. The state is responsible for nearly all Exchange functions. The state solicits bids from health insurance companies and determines which plans it will offer. The state also directly negotiates the price and benefits offered.
- Federal-State Partnership Marketplace. The state can perform plan management functions (such as certifying health plan participation); the federal government is responsible for all other aspects of the exchange. Any carrier meeting minimum federal and state requirements can participate in this exchange.
- Federally-Facilitated Marketplace. The U.S. Department of Health and Human Services (HHS) runs this exchange in states that choose not to create one.
For all models above, the state insurance departments maintain their traditional role of regulatory oversight of insurance rates and form filings as well as regulators of brokers and producers.
Individual Marketplace Enrollment Periods
See Individual Marketplace Enrollment Periods: Annual Open Enrollment Period and Special Enrollment Periods.
All Marketplace plans provide coverage based on a calendar year. Even if you signed up in the middle of the year, your coverage will continue only through December.
Making Changes After Enrollment
See Making Changes After Enrollment: Changes Prior to Effective Dates and Changes during the Year.
Let Liberty Medicare help you to get coverage through the Health Insurance Marketplace
Liberty Medicare is here to help you learn about Marketplaces and assist with eligibility determination for enrollment in a Qualified Health Plan (QHP) and for insurance affordability programs, which include Medicaid, CHIP, premium tax credit, and cost-sharing reductions. We will help you to compare plans and enroll in coverage. All of our services are offered to you at no cost.
Liberty Medicare represents many well-known Health Insurance Marketplace providers in New Jersey and Pennsylvania. Learn more about all of the benefits of working with Liberty Medicare.
If you are considering buying insurance in the Health Insurance Marketplace, let us guide you. To see real quotes from insurance providers visit Federal or State Marketplace, fill out our Individual Health Quote form, or give us a call at 877-657-7477.