Could I Qualify for the Higher Insurance Subsidies During Open Enrollment?
The Importance of Reviewing Your Explanation of Benefits
Open enrollment is an excellent time to review health insurance plans to see which one will best meet your needs in the upcoming year. You can also find out if you qualify for federal subsidies that now make it easier to purchase a brand-name policy under the Affordable Care Act.
With the American Rescue Plan, Congress expanded the financial aid that enables the Golden State’s residents to obtain quality health insurance through Covered California's marketplace. Eligible households can see their insurance costs reduced by thousands each year. You will not need to show the previously required income levels to receive tax credits or pay reduced premiums for plans purchased through the marketplace.
What Are the Income Limits That Enable Me To Qualify?
Individuals with an annual income of no more than $19,320 can qualify to purchase health insurance that costs as low as $1 per month. Unlike many other federal assistance programs, you can now also earn a higher annual income and still receive tax credits to help cover your health care costs.
If you earn no more than $38,640 each year, your insurance plan could enable you to claim federal income tax credits. Eligible households could purchase health care through California's marketplace and spend no more than 2% of their annual income on premiums.
With the higher subsidies, households earning $57,960 could pay 6% of their yearly income on insurance premiums. If your household earns $77,280 annually, no more than 8.5% of your yearly earnings would go toward paying premiums. If you earn more than $100,000 annually, however, you could still qualify to save a significant sum through tax credits.
Can I Still Qualify for Subsidies if I’m Already Insured?
If you obtain health insurance through your employer's group plan, you could still qualify for federal assistance based on your income. The amount you currently pay for a policy issued as part of your employment benefits package determines whether you're eligible.
Your premium costs also show how much you could claim on your federal income tax return. If your cost for a group plan exceeds 8.25% of your yearly earnings, you can qualify for a tax credit. You could also receive a discount if you purchase a name-brand policy through the marketplace.
What Health Care Benefits Are Available Through the Marketplace?
The marketplace insurance policies cover the types of medical treatment that the federal government considers essential. Comprehensive plans are also required to provide benefits for breastfeeding and birth control.
The essential services categories are:
- Emergency medical services
- Outpatient ambulatory care
- Hospitalization including overnight care
- Mental or behavioral health care including substance abuse services
- Devices and services for physical rehabilitation
- Maternity, newborn care and pregnancy care
- Prescription medicine coverage
- Pediatric health care that includes vision and dental treatment
- Preventative services, wellness and ongoing care for chronic diseases
- Lab work and services
Greater than 260,000 Golden State residents are estimated to already have direct insurance coverage that they purchased outside the marketplace. During open enrollment, they're expected to switch to plans with the same level of coverage but instead offered through the marketplace. The difference they’ll see is the money they’ll be saving through the tax credits provided by the American Rescue Plan.
How Do Marketplace Insurance Plans Differ From Each Other?
The Covered California marketplace divides health insurance plans into four tiers: Bronze, Silver, Gold and Platinum. The Bronze tier offers two approaches; there's a conventional plan and one with higher insurance deductibles that complement a health savings account.
Plans in the Bronze tier typically pay 60% of your medical expenses. If you don't have a health savings account to cover the remaining 40%, you may prefer the Silver tier. Plans in the Silver tier could cover 70% of your health care expenses. Those in the Gold tier can pay 80% of your costs.
If you anticipate requiring substantial medical care, you may consider a plan in the Platinum tier, which could cover 90% of your expenses. With only 10% coming out of your own pocket, you could see a significant reduction in your health care costs in the upcoming year.
Could I Be Eligible for a Marketplace Plan That Can Meet All My Needs?
With so many insurance carriers providing coverage through the marketplace, you’ll find that there are several choices that can meet both your health and your budget requirements. By comparing and customizing the available policies, you can arrange a plan that will help ensure all your needs are met. There’s no reason to worry about giving up necessary health care benefits. We’re here to help. We’ll take the confusion out of getting you set up with the right policy.
If you're ready to see the financial subsidies and plans you qualify for, contact us online or by phone at (707) 823-3689 to go over your options. Sackett & Associates is an independent agency that works for you and not for the insurance companies. For those plans set to begin on January 1, 2022, open enrollment ends on December 31, 2021. We look forward to hearing from you soon!
References:
https://www.sanluisobispo.com/news/local/article251013619.html
https://www.ftb.ca.gov/about-ftb/newsroom/health-care-mandate/personal.html
https://www.coveredca.com/california-subsidy/
https://www.healthcare.gov/coverage/what-marketplace-plans-cover/
https://www.coveredca.com/support/before-you-buy/metal-tiers/
https://www.sackettinsurance.net/contact
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