Following up on the story posted here on Monday, today we will further attempt to enlighten consumers on the basic information needed in order to make an informed decision on their health care insurance choices.
On Tuesday, ABC News offered readers the answers to ten questions about the Affordable Care Act insurance exchanges. Today, we are going to look at the basic types of insurance that will be available through those exchanges.
Remember this fact, Obamacare, or the Affordable Care Act does not replace private insurance, Medicare or Medicaid. You do not have to give up the health insurance you already have and like. You can continue to use it.
The new health care act will be offering a number of additional protections to the consumer including requiring that all insurance plans cover preventive services and provide new essential health benefits. This is a good thing.
The act also stops insurance companies from dropping you if you get sick or when you make a mistake on your application. Gender discrimination is forbidden, and a pre-existing condition will not keep you from getting health insurance coverage.
And finally, Your State's Health Insurance Marketplace Opens Oct 1st, 2013 and closes March 31st, 2014. Most Americans must enroll in or have a health insurance plan by January 1, 2014, get an exemption or pay a fee for every month they are without insurance. The fee is paid on your federal income tax return.
Obamacare metal plans
The new health plans that take affect in 2014 under Obamacare are referred to as "metal plans." They are named after four metals, bronze, silver, gold, and platinum. The platinum plan is the best, and in descending order, the bronze plan would be adequate, but cost the least amount.
The four plans are different from each other based on what is called the "actuarial value." This value refers to the average amount of insurance expenses that would be paid by the plan. The higher the actuarial value of the plan, the lower the out-of-pocket costs for the customer.
In other words, the more expensive the metal, (for example, platinum), the higher the actuarial value. Platinum plans cover 90 percent of covered medical expenses, while the bronze plans cover 60 percent of covered expenses.
It stands to reason that a bronze plan, only covering 60 percent of covered medical expenses would be the cheapest plan. But because competitiveness among insurance providers is being encouraged, one company's silver plan could be cheaper than another company’s Bronze Plan.
Regardless of the company or plans, they will all have a shared maximum out-of-pocket amount that an enrolled individual can pay in a calendar year. This is another good thing for the consumer.
Requirements of all the plans
All plans must offer basic, or essential health benefits. This is similar to the supplemental insurance plans offered to Medicare recipients. In other words, everyone is guaranteed to have the minimum of health care given by any of the four plans.
Insurance companies do not have to carry all four metal plans. Some may carry only two or three of them. There is even something called the "catastrophic plan," for those who can demonstrate problems affording the bronze plan. This plan is only available through an exchange and tax subsidies cannot be used to reduce its premiums.
This may be enough information to digest for a day or so, and hopefully we have covered the basics of the metal plans. We will next go into what the individual plans have to offer, and the differences among them.