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Understanding health insurance and the Affordable Care Act
Finding the right health insurance starts with understanding health insurance. But how? There are so many terms. So many things to consider. Don’t worry, we’ve got your back. Here’s everything you’ll need to know to make informed, educated decisions when choosing a health plan.
Health insurance 101
This crash course will teach you the basic terms you need to compare health plans and choose the one that’s best for you.
The comprehensive healthcare reform law enacted in March 2010 (sometimes known as ACA, PPACA, or "Obamacare"). The law has three primary goals.
- Make affordable health insurance available to more people. The law provides consumers with subsidies ("premium tax credits") that lower costs for households with incomes between 100 percent and 400 percent of the federal poverty level.
- Expand the Medicaid program to cover all adults with income below 138 percent of the federal poverty level. (Not all states have expanded their Medicaid programs.)
- Support innovative medical care delivery methods designed to lower the costs of healthcare generally.
Health insurance marketplaces are organizations in each state through which people can purchase health insurance. People can purchase health insurance that complies with the Affordable Care Act at ACA health exchanges, where they can choose from a range of standardized plans offered by the insurers participating in the exchange.
Coverage is health insurance that a member receives for covered services.
A premium is the amount a member or group pays on a periodic basis for coverage as defined in the member's health insurance certificate or contract.
A deductible is the amount of covered expenses that must be paid by a subscriber in a calendar year before benefits are paid by the insurer.
A copay is the dollar amount that a member usually pays each time that a covered service is performed. If the member's plan has a copayment amount, it is typically listed on the member ID card.
Coinsurance is the percentage of an allowable charge that a member pays, not including any copayments or deductibles. For example, if the member's plan has an 80/20 coinsurance rate, the insurer will pay 80 percent of the allowable charge for eligible medical expenses and the member will pay the remaining 20 percent.
Your expenses for medical care that aren't reimbursed by insurance. Out-of-pocket costs include deductibles, coinsurance, and copayments for covered services plus all costs for services that aren't covered.
Most benefit plans have an out-of-pocket maximum. If the total dollar amount that you have paid in deductibles, coinsurance, and in some cases copayments, reach this maximum amount in a calendar year, then the insurer will pay 100 percent of the allowed charges for the remainder of the year.
An EPO (Exclusive Provider Organization) is similar to an HMO as it is a healthcare plan type that covers eligible services from providers and facilities inside a network. Generally, an EPO does not pay for any services from out-of-network providers and facilities except for emergency services, which is similar to an HMO. Unlike an HMO, EPO participants are not usually required to have a primary care physician or referrals.
A PPO (Preferred Provider Organization) is a healthcare plan that allows people to see doctors or get services that are not part of a network. Those out-of-network services are at a higher rate, though. Plans are structured so that members will pay less money out-of-pocket when they use in-network providers.
In-network: A hospital, pharmacy, physician or other medical service provider that has a contract to participate in one or more plans with Blue KC. A provider who is considered in-network for one plan may be considered out-of-network for another plan.
Out-of-network: A hospital, pharmacy, physician or other medical service provider that does not have a network contract with Blue KC to provide healthcare services to members. Both non-participating providers and non-preferred providers are also referred to as out-of-network providers. PPO members who visit an out-of-network provider will receive limited benefits. EPO and HMO members will not receive any benefits except in the case of an emergency.
A feature of plans with exclusive access to Spira Care, first dollar coverage refers to benefits paid by Blue KC from the first dollar billed, without copayments or deductibles, for standard preventive care visits. You pay nothing out-of-pocket even if your deductible hasn't been met for the year. Learn about savings and other benefits of Spira Care.
The American Rescue Plan Act, which became law in March, 2021, extends ACA premium subsidies to higher-income people who didn’t previously qualify and for lower-income people who do. Find out more at ARP subsidies.
How to choose the right plan
Here are topics to consider that are specific to you and your individual needs.
There are two types of financial assistance available to marketplace enrollees. The first, called the premium tax credit, works to reduce your monthly payments for insurance coverage. The second, referred to as cost-sharing reductions, is designed to reduce your out-of-pocket costs when utilizing care. In order to receive either type of financial assistance, qualifying individuals and families must enroll in a plan offered through the health insurance Marketplace.
- Premium tax credit: Have a household income from one to four times the Federal Poverty Level (FPL)
- Cost-sharing reduction: Have a household income from one to 2.5 times the Federal Poverty Level (FPL) & choose a Silver level plan
- Do not have access to affordable coverage through an employer (including a family member’s employer)
- Not eligible for coverage through Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), or other forms of public assistance
- Have U.S. citizenship or proof of legal residency (Lawfully present immigrants whose household income is below 100 percent FPL and are not otherwise eligible for Medicaid are eligible for tax subsidies through the Marketplace if they meet all other eligibility requirements.)
- If married, must file taxes jointly in order to qualify
When choosing a plan, it’s a good idea to think about your total healthcare costs, not just the monthly premium you pay every month. Other amounts, sometimes called “out-of-pocket” costs, have an impact on your total spending on healthcare.
- Deductible: How much you have to spend for covered health services before your insurance company pays anything (except free preventive services)
- Copayments and coinsurance: Payments you make each time you get a medical service after reaching your deductible
- Out-of-pocket maximum: The most you have to spend for covered services in a year. After you reach this amount, the insurance company pays 100 percent for covered services.
Consider additional benefits, such as the embedded savings with Spira Care plans, as your policy may provide low to zero dollar services included with the cost of your monthly premium. These features can be an important savings throughout the course of the year.
When you compare plans in the Marketplace, the plans appear in 4 "metal" categories: Bronze, Silver, Gold, and Platinum. The categories are based on how you and your plan share the total costs of your care.
Note: Plans in all categories provide free preventive care, and some offer selected free or discounted services before you meet your deductible.
Generally speaking, categories with higher premiums (Gold, Platinum) pay more of your total costs of healthcare. Categories with lower premiums (Bronze, Silver) pay less of your total costs. If you qualify for cost-sharing reductions (CSRs), Silver plans may offer a better value. If you qualify, your deductible will be lower and you’ll pay less each time you get care.
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If you don’t expect to use regular medical services or take regular prescriptions, you may want a Bronze plan. These plans can have very low monthly premiums but have high deductibles and pay less when you need care.
If you qualify for cost-sharing reductions (CSRs), then Silver plans may be a better value. If you qualify, your deductible may be lower, which means you pay less when you get care. You get these extra savings only if you enroll in Silver. If you don’t qualify for CSRs, compare premiums and out-of-pocket costs of Silver and Gold policies to find your right plan.
If you expect frequent doctor visits or need regular prescriptions you may want a Gold plan. These plans usually have higher premiums but pay more of your costs when you need care.
All Marketplace plans must cover treatment for pre-existing medical conditions. Once you are enrolled in an ACA health plan, no Marketplace insurer can reject you, refuse to pay for essential health benefits, or charge you more for any condition you had before your effective date. Also, the insurer cannot raise your rates, deny you coverage, or cancel your policy based only on your health. Insurers can only adjust rates at renewal time for all enrollees and not just based on your individual health.
While none of our plans require the selection of a primary care physician (PCP), there are benefits in doing so. PCPs often maintain long-term relationships with patients and can advise and treat you on a range of health-related issues. They may also coordinate your care with specialists.
If you need to find out if your doctor or other healthcare providers are covered by your plan, or if you need to find a covered provider if you don’t have one yet:
- Find in-network doctors, hospitals, behavioral health providers, and other healthcare professionals based on your plan. View our network now.
- Once you're enrolled in a Blue KC policy, you should review the specific list for your policy on MyBlueKC.com to find customized doctors and hospitals directories.
- Call your doctor’s office. They can tell you if they accept your health plan.
When in doubt, call Blue KC or your provider to verify your provider is in-network. This is especially true with Exclusive Provider Networks (EPOs), as these have a restricted network and won’t pay for the care you receive outside of the network unless it is an emergency.
The Prescription Drug List is a list of prescription medications that have been reviewed and recommended by Blue KC's Medical and Pharmacy Management Committee. Feel good knowing that each medication has been reviewed for safety, effectiveness, clinical outcomes and cost. You can view this PDF for a sample list; once you're enrolled in a Blue KC policy, you should review the specific list for your policy on MyBlueKC.com.
Yes. The Affordable Care Act provides mental health and substance use disorder coverage. This means that most individual insurance plans, including all plans offered through the Health Insurance Marketplace, cover mental health and substance use disorder services. This law also requires coverage for rehabilitative and habilitative services that support people with behavioral health conditions.
Consider additional benefits not required by the Affordable Care Act when looking at your plan options, as these will add value to your premium dollar. Blue KC offers a variety of additional services, such as Telehealth, Mindful (behavioral health), Blue365 (health and wellness discounts and offers), Healthy Companion (chronic condition support), Livongo (diabetes self-management), & Rx Savings Solutions (prescription savings).
You can shop for and enroll in an ACA health plan during the annual Open Enrollment Period which runs from November 1, 2021 to January 15, 2022. For health coverage needs outside of the Open Enrollment Period, you may still sign up for an ACA health plan for you and your family if you qualify for a Special Enrollment Period. To qualify, you must experience a qualifying life event such as having or adopting a baby, getting married or divorced, moving, or losing your health coverage to name a few.
- Shop and enroll in an on-exchange policy in one experience
- Submit required documentation to the marketplace, such as proof of income and citizenship status
- Report life changes and update your information
- Easily renew your coverage during open enrollment
Or contact your local agent to assist you with your enrollment.