Derek Miller, president, Alivint Financial and Insurance
The Affordable Care Act, commonly known as Obamacare, didn’t work itself into US Law without controversy. The national overhaul created as many problems as it did solutions for our country’s need for regulation in its healthcare system.
“Surfing” the website healthcare.gov may or may not have been as smooth as expected. After hours of a “crashing” experience, some found a new plan at half the cost, while others found their monthly premiums doubled or event tripled. Whether you are for the new law or against it, those involved either play along or pay the price….literally.
The penalty for not having insurance in 2014 is only 1 percent of your income, or $95 per adult ($47.50 per child), whichever is greater (with a family maximum of $285). In 2015 the penalty will increase to 2 percent or $325 per adult.
Yes, that is a slap on the wrist for not being insured. However, the Federal Government is also incentivizing “Middle America” to enroll in coverage by offering subsidies known as “Tax Advance Credits” toward premiums. For example:
- Without the Tax Advance Credit (subsidy) a family of five could expect to pay approximately $785/month as a benchmark.
- With a $40,000/year income, this family could qualify for a Credit of approximately $661/month for a total premium of $124/month.
- With an $80,000/year income this same family could qualify for a Credit of approximately $170/month for a total premium of $615/month.
There are many factors involved with filling out an enrollment application and choosing a health insurance plan. You can do it on your own, but using an accountant and health insurance agent is advised. Although a good accountant or CPA usually charges by the hour, they know law, and, in the end, your adjusted gross income effects your monthly premiums. Health insurance agents are free to use and are trained on navigating through the many decisions regarding deductibles, coinsurance, copays, networks and more.
If you didn’t jump in headfirst during last year’s open enrollment and need a place to start, the “Obamacare” Tips at the right are just for you.
In the end, The Affordable Care Act was intended to give Americans choice. Navigating through these choices is full of pivotal decisions that affect the outcome. In the wise words of Dr. Suess, “Step with care and great tact, and remember that life’s a great balancing act.”
In 2015, the proposed Open Enrollment Period is November 15, 2014, through February 15, 2015. This is the window to make changes to your plan.
You may enroll in a plan in one of the following four ways:
- Call your insurance agent who can help you from start to finish. (This assistance is free to you.)
- Visit www.healthcare.gov to enroll through The Marketplace.
- Call The Marketplace at 1-800-318-2596 and apply over the phone.
- Enroll directly through any participating health insurance carrier.
Items to consider while choosing a plan:
- Deductible vs. Premiums: The lower your deductible, the higher your premiums and vice versa.
- Coinsurance: Once you meet your deductible, you and your insurance carrier each pay a pre-determined percentage of the claims (i.e.,80/20).
- Out-of-Pocket Maximum: First you pay your deductible, then you pay your coinsurance until you reach your “cap” or max- imum out of pocket. Then, your insurance carrier pays 100 percent of the contracted, covered claims.
- Networks: Be sure to check your new plan to ensure your preferred doctors are contracted in network to avoid unexpected bills.
- Prescription Formularies: More than ever, insurance carriers are adjusting which precriptions are and are not covered. Contact your carrier or agent to find out how your prescriptions will be covered.