Affordable Health Insurance Options You Need to Know About
Posted By Macey Farnsworth on August 22nd, 2019
Nearly all people in the US consider health insurance to be an absolute priority, as almost 90% of individuals have coverage. Affordable health coverage is becoming increasingly difficult to find. Over the past decade, premiums have risen 50% for individuals and those with employer-sponsored plans.
But, if you are under the age of 65 and don’t meet the qualifications for Medicaid, then you need to shop for coverage. Although the Affordable Care Act (ACA) allows individuals to access affordable plans in every state, there is a wide variance in plan offerings and prices.
Below, we’ll outline some of the most affordable health plans available in various states and how they might work for you.
Health Insurance Exchange Plans
In 2018, Americans paid over $400 on average per month for health insurance premiums. That doesn’t include deductibles or copays. Factor in total healthcare costs and that number balloons into a much higher figure.
Health plans featured on the state government health exchanges are a great option because they are eligible for subsidies. Insurers who participate in the exchange must sell at least three types of plans which include gold, silver and child-only. You will have a choice when it comes to choosing the most affordable health plan.
Subsidies: Can I Qualify?
Before you throw your hands up in the air in despair, the federal government does offer subsidies for health insurance premiums. If you earn up to 400% of the federal poverty line, then you are likely eligible for subsidies.
Health insurance is managed at the state level. Therefore, each person has to apply through their state health insurance exchange to verify whether they can get a subsidy for their health insurance.
If you do qualify for a subsidy, then on-exchange health plans are easily the best choice. While off-exchange plans may be slightly cheaper, an on-exchange plan will have the most coverage for a much lower price, with subsidies.
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Off-Exchange Health Insurance
Purchasing a health insurance plan that is not on your state’s exchange is a great way to save money. Many insurance companies are opting out of state health exchanges due to excessive rules and regulations.
Restrictions imposed by states are making many health insurance companies raise prices on plans. By leaving state exchanges, insurers can offer plans that are still ACA-compliant at a lower cost. Best of all, these plans are also guaranteed issue, so those with pre-existing conditions need not worry about qualifying.
Affordable Policy Types
Where you get your health insurance matters, but the type of policy you purchase matters more. Exchanges offer different tiers, or “metals,” of coverage. Gold is the highest, and catastrophic is the lowest. A gold plan provides the highest level of coverage but also costs the most. If you are looking for affordable coverage, then gold plans are likely beyond your budget.
Catastrophic and Bronze Plans
If you are young, healthy and not averse to some risk, then a catastrophic insurance policy is a great way to save money while still having health insurance. For instance, a monthly premium for a catastrophic health plan in Alabama would cost a 40-year old person under $300. If that person were 21, it would be close to $200.
On the other hand, a catastrophic policy is incredibly risky. These plans are a high deductible, which means you are paying a high cost out of pocket before the insurance kicks in and starts paying your medical bills. Typically, these deductibles are in the $8,000 range. If something serious happens, like a broken arm, then you will be paying a huge, upfront cost.
Bronze plans offer much more in the way of benefits and are usually only slightly more expensive. Due to the extensive regulations, insurers must comply with to do business on an exchange, bronze and catastrophic do not vary much. In Idaho, for instance, Bronze plan premiums average around $400 per month.
Short Term Insurance
Currently, short-term insurance is experiencing a resurgence. Once limited to only three months, people can purchase short-term insurance for up to a year. Why is this good? Short-term insurance is exempt from ACA rules and regulations. That makes policies cheaper while retaining the same benefits in-state insurance exchanges offer.
Short term insurance is an excellent option for those who want to get out of their current plan, but are unsure of what type of plant to get next. Short term insurance protects individuals who acquire a long term illness by keeping their premiums down when they enroll in their next round of coverage.
Limited Benefit Indemnity Insurance
Limited Benefit Indemnity Insurance is also exempt from ACA regulations. One of the unique features of limited benefit is that it functions on a fixed rate basis. That means each plan offers a fixed fee for each use of medical services.
Since there is no deductible, users can save tremendous amounts of money if they are healthy and only use primary care every once in a while. However, if you have health issues, then this is not the insurance plan for you as there is not as much coverage for beyond the primary level.
Health insurance is rapidly changing in the current political climate. Many more options are becoming available, and health exchanges are far from the only place to acquire affordable healthcare. Short-term plans or off-exchange insurance plans offer the best variety, and lowest costs to those looking for economical health insurance solutions.