What Is The Health Insurance Marketplace Or Exchange?

Mandates, subsidies, tax credits, fines, exchanges, marketplace, co-ops, private insurance reform… What do all of these terms mean?

In an effort to better understand the changes the ACA will be bringing, we must separate the legislation into three distinct categories, or “silos”. These silos are not dependent upon one another, but can definitely have an impact on how the others operate.

  1. Patient reform (I explained in an earlier blog post that there is none of this.)

  2. Insurance reform

  3. Payment reform (In earlier blogs I talked about fee-for-service, bundled payments, and ACOs.)

Insurance reform is a very large portion of the ACA. Many have said this legislation is not about healthcare reform, but insurance reform; there is validity in this statement.

As a result of the ACA, more people than ever, in the history of healthcare, will be eligible for free or low-cost health insurance; shopping for the right coverage will be made easy through the Health Insurance Marketplace. Coming this October, individuals and small businesses will be able to shop for health insurance that fits their budget through these Exchanges or Marketplace.

Enroll America, a privately organized not-for-profit organization aimed at maximizing the number of uninsured individuals in healthcare, has conducted research showing that 78% of the currently uninsured, do not understand the new healthcare laws and are completely unaware of their options. Those individuals say that they would like to learn more in a “just-the-facts sort of way.”

About the Marketplace

The state-based Marketplace will provide detailed information, break down costs and allow users to search and compare private health plans. There will be no hidden costs when choosing coverage and it will be easy to compare prices, benefits and quality of care, side-by-side. Moreover, insurance companies will not deny coverage for anyone due to chronic or pre-existing conditions.

Eligibility

The Health Insurance Marketplace is for just about everyone – the uninsured, small businesses needing insurance and the insured wanting to know their options. You must meet three requirements in order to use the Marketplace:

  1. You must live in the U.S.

  2. You must be a U.S. citizen or national (or lawfully present)

  3. You can’t be currently incarcerated

Tax credits

Tax credits are available as soon as enrollment begins. What’s different about the tax credit, through the Marketplace, is that there will be an obvious decrease in monthly costs.

Individuals have the option to choose how much of their tax credit money they want applied towards their monthly premium. However, the amount they are eligible to receive depends on the size of their family and expected yearly income.

Small businesses may qualify for the Small Business Healthcare Tax Credit. This tax credit will help bring down the costs of providing insurance for employees.

Enrollment

In just a few short months individuals and small businesses will be able to enroll in the Health Insurance Marketplace online, or by calling a toll-free number. There will be experts available to answer questions and suggest plans. The coverage provided through the Marketplace will go into effect January 2014.

The U.S. Department of Health and Human Services offers a free service for you to receive email and/or text message updates concerning your state’s Marketplace. Visit www.healthcare.gov/marketplace to sign up.