Affordable Health Insurance: ARPA Expansions

The American Rescue Plan Act of 2021 (ARPA) has put into place several temporary expansions to the Affordable Care Act (ACA) provisions that can help Americans access health coverage at affordable prices. In general, these benefits apply to people who purchase health insurance in the Marketplace (created by the ACA) because they do not have an affordable option available through employment. The expansion has two dimensions: 1) more people are eligible for help paying the health insurance premiums for plans purchased in the Marketplace, AND 2) those who are eligible for help are now eligible for MORE help, so that their share of the monthly premium can be reduced.  People who are unemployed will especially benefit.

The Health Insurance Marketplace is now open for enrollment through August 15, so if this information makes you want to enroll in a plan OR change the plan you chose, you should be able to do so in the next few weeks. NOTE: The law took effect March 11. The agency in charge of the Health Insurance Marketplace expects to be ready to implement many of the changes on April 1. Suggestion: if you call or log in to the Marketplace in early April, ASK if the new rules are yet in place. It might be worth waiting a week or two in order to be sure the changes have been built into the system.

More Help. The ACA created a maximum cost people would have to pay for health insurance premiums, stated as a % of your income. The ARPA dramatically reduced that percentage of income for 2021 and 2022.  For example, suppose you are a 2-person household with income of $43,000/year (which is just under 250% of the poverty level); under the ACA your share of the premium for a benchmark silver plan would have been 8% of your income; under the new ARPA guidelines, your share of the premium cost for that same silver plan is just 4% of your income. Implications:

  • Some people who previously decided health insurance was too expensive will NOW decide it is affordable under the new rules.
  • People who chose a less-expensive bronze plan despite its higher deductible and copays may NOW decide a silver plan is worthwhile.
    This is of special value to those who are at or below 250% of the federal poverty mark, because these folks are eligible for plans that sell for a “silver” price but have smaller deductibles and copays so that they are more like a gold or platinum plan. In other words, folks under the 250% level can get a premiere plan for a budget price.
    It’s sort of like getting a brand-new luxury SUV for the price of a 2014 compact sedan!
  • If you are already enrolled in a Marketplace plan, there is a good chance that your share of the monthly premium is reduced under the new rules. Consider contacting the Marketplace (800-318-2596) sometime later in April.

More People Eligible.  Under the original ACA rules, if your income was over 4 times the poverty level, you were not eligible for help paying for health insurance. Under the ARPA expansion, people of any income level are eligible if the cost of the Marketplace plan would exceed 8.5% of their income. This will be especially valuable for those in their 50’s and 60’s, since health insurance premiums rise with age. This provision is also in effect for 2021 and 2022. 
Implication: some people with incomes above the 400% threshold may have compromised to save money by purchasing health coverage that was poorer quality (that is, it does not meet the ACA standards related to broad coverage and value). With the new cap of 8.5% of income regardless of income level, these folks might now be able to purchase a high-quality plan for an affordable price.

Huge Benefit for Those Unemployed at ANY time during 2021.  Note: this benefit is ONLY in effect in 2021.  If you receive(d) Unemployment Income at ANY time during the 2021 calendar year, special rules apply for your eligibility. With regard to eligibility for help paying for health insurance in the Marketplace, any income above 133% of the poverty level will be disregarded. That means these households will be eligible for the “platinum-like” silver plans for FREE – the premiums will be entirely covered by the subsidy.  Note: all other qualifications must also be met. For example, if you have workplace coverage available that is considered affordable, then you will not be eligible for the free silver plan.  However, if you are unemployed now, take advantage of the free silver plan. If you get a new job in a couple months that provides insurance, you can then drop the silver plan.
For those whose incomes are below 100-133% of poverty, they will be eligible for Medicaid coverage (also free), even in states where Medicaid was not expanded.

COBRA Subsidy. For people who lost health coverage due to being laid off or having their work hours reduced, the government will cover the cost of their COBRA premiums for up to six months, from April 1 – September 30, 2021. Check with your employer about how this might help you. Even if you lost your job months ago and did not sign up for COBRA at that time, you should now be able to sign up for COBRA.
Note: if you are in this group, you might also benefit from Marketplace insurance or Medicaid, so be sure to evaluate all your options.

Primary Source: Kaiser Health News Details for the % of income (paragraph 3) from Kitces.com
For more information see: https://www.healthcare.gov/more-savings/

Barb Wollan

Barb Wollan's goal as a Family Finance program specialist with Iowa State University Extension and Outreach is to help people use their money according to THEIR priorities. She provides information and tools, and then encourages folks to focus on what they control: their own decisions about what to do with the money they have.

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Understanding Health Insurance

This time of year many Americans make health insurance decisions. If your health insurance comes through your employer, you may be making plan choices in the next month or so, and if you purchase insurance individually, open enrollment is November 1 through December 15. Are you equipped to make informed choices about your health insurance?

ISU Extension and Outreach offers two free on-line workshops on health insurance topics:

  • Smart Choice Basics focuses on the key things to know before you sign up for a specific health plan. It’s useful to people who get their insurance through their employer as well as to people who need to purchase insurance on their own. It also addresses questions about how to get help paying for health insurance via the HealthCare.gov Marketplace. It is being offered November 19 and December 1 (6 p.m. each day).
  • Smart Use: Smart Actions for Using your Health Insurance Wisely. This workshop focuses on seven key actions for consumers to take, including keeping track of the health care they receive, reviewing their bills carefully and disputing errors, understanding deductibles and co-pays, and more. It is being offered November 2 and December 8 (6 p.m. each day).

Understanding key health insurance principles can save you money year-round. It also gives you the confidence to ask useful questions about health costs and bills, and to make informed choices about when and where you receive the health care you need.

Pre-registration for the health insurance workshops is required.
Questions? Contact Barb Wollan or Brenda Schmitt. The flier is attached below if you’d like to share it with others.

These two workshops were developed by a team of experts from across the nation led by University of Maryland Extension. They are conducted locally by trained Iowa State University Extension and Outreach specialists.

Barb Wollan

Barb Wollan's goal as a Family Finance program specialist with Iowa State University Extension and Outreach is to help people use their money according to THEIR priorities. She provides information and tools, and then encourages folks to focus on what they control: their own decisions about what to do with the money they have.

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Health Insurance: Shop Wisely

HClogoThe other day a friend asked me about health insurance.  She said “I’ve been getting all this different advice: ‘Go see Agent X – he’ll fix you up;’ or ‘Agent Y found a really good plan for me.’  I’ve seen a couple different agents and I’m confused.”

Until she talked with me, no one had suggested checking on www.healthcare.gov .

I don’t know what her income is, but I think she may be eligible for premium tax credits to help pay monthly premiums for health insurance.  But before our conversation, she didn’t realize that help was available.  The key point I explained to her was this:  Premium Tax Credits are only available if you buy your health insurance in the official “Marketplace” through www.healthcare.gov

Some insurance agents will help customers enroll in plans offered in the Marketplace.  They only receive a tiny commission for helping clients, but they do it anyway, because they want to serve their customers well.   If your income is below the income guidelines for premium tax credits (over $90,000 for a family of four), make sure your insurance agent shows you the plans available in the Marketplace and explains how the premium tax credits work.

To find a health care navigator or certified application counselor near you, go to www.getcoveredamerica.org/locator

Health Insurance is important.  Even if a cheaper plan is available somewhere else, you may come out ahead by purchasing a plan in the Marketplace, where Premium Tax Credits can help cover the cost of a plan that meets high quality standards.

Barb

Barb Wollan

Barb Wollan's goal as a Family Finance program specialist with Iowa State University Extension and Outreach is to help people use their money according to THEIR priorities. She provides information and tools, and then encourages folks to focus on what they control: their own decisions about what to do with the money they have.

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Is Your Health Insurance Right for You?

SmartChoiceLogo1Last week it was announced that people who signed up for health insurance through the official Marketplace (www.healthcare.gov) will automatically be re-enrolled in the same plan for next year, unless they log in to make a change.

I see that as good news, because it guarantees that no one will just forget to sign up again next year.  Hopefully it will also reduce the “traffic” on the healthcare.gov website.

But is re-enrolling in the same plan the best choice for you? 

That will be the key question. Paying attention now will help you be ready when next fall’s enrollment period comes around.  Here are some questions to keep in mind throughout the year:

  1. Am I happy with the doctors and other health providers available in my plan’s network?
  2. How much am I using health care services? (it’s smart to keep track of visits and costs for each family member)
  3. Am I taking advantage of the preventive care which, under most health plans, is available with no co-payments or deductibles?
  4. Have I met my plan’s deductible?
  5. How much have I spent in co-payments or co-insurance?
  6. Have your health care needs changed during the year?

Knowing how much care you needed in 2014 will help you make a smart health insurance choice for 2015.  When choosing between platinum, gold, silver, and bronze plans, you need to balance the costs and benefits:  higher premiums in exchange for lower deductibles and co-pays?  Or will you be better off paying lower premiums, even if the deductible and other out-of-pocket costs are higher?

To help you understand how to use your health insurance, ten helpful new videos, each lasting just one or two minutes, are available at http://marketplace.cms.gov/help-us/c2c.html .  They’re available in both English and Spanish!

~Barb

Barb Wollan

Barb Wollan's goal as a Family Finance program specialist with Iowa State University Extension and Outreach is to help people use their money according to THEIR priorities. She provides information and tools, and then encourages folks to focus on what they control: their own decisions about what to do with the money they have.

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Health Care Marketplace: Follow the dots

directionI had a call a few days ago from a woman who was stuggling to find the “Iowa Health Insurance Exchange” on line.  She had put that phrase into her search engine and come up with lots of options – some that were “dot-com” sites, others that were “dot-org” sites.  Among the options were a few “dot-gov” sites.

Listening to the news, it’s easy for our minds to become cluttered with phrases.  And we’ve become accustomed to being able to “google” anything to find it. 

If you, or someone you know, is looking for the official health insurance marketplace in your state, the place to begin your search is at www.healthcare.gov   Key point: use “dot-gov.”

Why does it matter? Starting somewhere else could lead to misdirection and possible problems.  Other sites may have a sales motive or a political agenda. A worst-case scenario might be identity theft; another risk is that a person might enroll in a health plan through another site and miss out on the cost reductions that are only available in the official health insurance marketplace.

Help your friends avoid misdirection! Remind them that, even though it’s not yet working as well as we would like, the correct website to find health coverage with the new Premium Tax Credits and Cost-Sharing Reductions is www.healthcare.gov

~Barb

 

Barb Wollan

Barb Wollan's goal as a Family Finance program specialist with Iowa State University Extension and Outreach is to help people use their money according to THEIR priorities. She provides information and tools, and then encourages folks to focus on what they control: their own decisions about what to do with the money they have.

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