Health Care Coverage Costs

Many questions you may have about health care coverage may involve costs. As you plan for enrollment, use the following information to better understand how various health care plans will work with your pocketbook.

The natural question when shopping for anything is, “How much will this cost?” Visit Healthcare.gov  (or BeWellNM.com in New Mexico) for the most accurate pricing information and to compare plans.

When using the Marketplace or Exchange, you may qualify for financial assistance that can assist in the following:

  • Lowering your monthly payments through a tax credit
  • Getting help with out-of-pocket costs
  • Getting coverage for low or no cost to you through a government program

When you fill out your application on Healthcare.gov (or BeWellNM.com in New Mexico), you’ll find out what kind of assistance you qualify for.

Lowering Your Premiums Through a Tax Credit

You may qualify for financial assistance through a tax credit. This credit helps qualified individuals and families afford health coverage purchased through the Marketplace or Exchange. This is how it works:

  • When you apply for health coverage on the Marketplace or Exchange, information you provide on your application about how much money you make, your family size and the type of plan you purchase may qualify you for a tax credit to lower your monthly insurance premiums.
  • When you’re comparing plans, the Marketplace or Exchange website will show you the amount of the tax credit and your discounted monthly premium amount for each plan.
  • This credit can be applied directly to your monthly premium, so you get the lower cost immediately.

 

Check out the SUBSIDY CALCULATOR to see if you qualify for a subsidy or tax credit.

Visit KFF.ORG

SAVE TIME by having the following information ready when you go online:

IDENTIFICATION:

  • Your Social Security number
  • Legal immigrants need their document number

WAGES:

  • Employer and income information for everyone in your family (like pay stubs, W-2 forms, or wage and tax statements)

CURRENT COVERAGE:

  • Policy numbers for any current health care coverage
  • Information about any job-related health care coverage available to your family

 

Changes to your family size, income or employment during the year can change the amount of your tax credit or make you eligible for savings if you hadn’t previously been eligible. You’ll need to report any changes through the Marketplace or Exchange website.

You can learn if you may be eligible for this tax credit. Click here to use the subsidy calculator.

Qualifying for Help with Out-of-Pocket Costs

If you buy coverage on the Marketplace or Exchange, you may also be able to get lower out-of-pocket costs (such as on deductibles, copays and coinsurance). This will help with costs you have to pay when you get medical care, such as when visiting a doctor or having a medical procedure. When you apply for coverage on the Marketplace or Exchange, you’ll find out if you qualify for reduced out-of-pocket costs. The amount of cost-sharing assistance you qualify for will depend on how much money you make, your family size and the type of plan you purchase. Only health insurance plans at the “Silver” level bought on the Marketplace qualify for assistance in lowering your out-of-pocket costs.

Getting Coverage for Low or No Cost to You Through a Government Program

When applying for health coverage on the Marketplace or Exchange, it may be determined that you or a family member qualifies for a government program at low or no cost, such as Medicaid (for low income or disabled individuals), Medicare (for those over 65 years, younger people with disabilities or people of any age with terminal Renal Disease), military coverage for veterans, programs for American Indians and Alaska Natives, or the Children’s Health Insurance Program (CHIP).

When you finish your application on the Marketplace or Exchange and it looks like you or a family member may be eligible for Medicaid or CHIP, you may automatically be enrolled. If you choose to purchase a health insurance plan on the Marketplace or Exchange rather than enroll in one of these lower cost government programs, you won’t be eligible for the tax credit or reduced out-of-pocket costs.

You may already qualify for Medicaid or CHIP now. Visit the following websites for more information:

Understanding How Health Care Costs Are Determined

Learn how premium, deductible, copayments and coinsurance work together so you understand what you could pay annually for your health care coverage. It can even help you keep your health insurance costs down and maximize your savings. Let’s look at each one individually along with other ways you may be able to get help paying for your health insurance costs.

What is a premium?

The premium is the ongoing amount you or your employer pay for your health insurance plan in order to maintain your health coverage. You are responsible for your premium whether you use medical services or not. In most cases, it’s paid monthly, but can be paid quarterly or yearly.

What is a deductible?

A deductible is the amount you must pay toward your health insurance costs before your health plan begins to pay for your covered services. For example, if you have a $1,500 deductible, your plan generally won’t pay for some services until you’ve paid $1,500. Your premium and deductible costs are connected. Typically, the higher your deductible, the lower your premium. The lower your deductible, the higher your premium.

  • How to choose your premium and deductible
    If you know you’ll be using your insurance often, you may want to choose a plan with a higher premium and lower deductible. This means you’ll pay more each month, but you’ll meet your deductible faster and your plan will begin to pay for your covered services sooner. Overall, you’ll spend less when you go to the doctor over the course of the year. The opposite of this is true too. You may want to choose a plan with a lower monthly premium and higher deductible if you know you won’t use your insurance often. This way your monthly health insurance costs are lower because you take the chance that you may not need to pay your deductible.
What is coinsurance?

Coinsurance is usually listed as a percentage, and it refers to the amount that you must pay for a covered service. It does not apply until you meet your deductible.

For example, let’s say it costs $100 to see your doctor. If your coinsurance is 25%, you must pay $25 and your health insurance plan pays $75. You must pay the entire amount if you haven’t met your deductible.

What are copayments?

Copayments are fixed dollar amounts you may have to pay when you see a doctor or specialist. In most cases, it’s a small amount, such as $25 for a doctor’s office visit. However, you won’t always have to pay copayments. The amount you pay depends on your health plan, which type of doctor you see and whether he or she is in network.

What is an out-of-pocket maximum?

The out-of-pocket maximum, or OOPM, is the most you have to pay out of your own pocket for medical services under your insurance plan during the year before your plan will start to pay all of the allowed amount. Your deductible, coinsurance, copays and any other expenses for in-network essential health benefits (EHBs) apply to the OOPM.

Keep Costs Down. Stay in Network.

Before you go for care, make sure you go to a doctor or hospital in your health plan network. These providers have agreed to work with your health plan to keep your costs down. If you visit a doctor outside of your network, you may have to pay more for your care. In some cases, you may have to pay the full cost. For HMOs, if you are referred to a specialist, make sure he or she is in your network.

Most insurance companies have information online about the providers who are in-network for the plans you are considering.

Get Help Paying for Your Health Insurance Costs

Under the Affordable Care Act, you may be able to get help paying for your health insurance costs through one or both of these options:

  1. Premium tax credit — A credit toward your monthly premium that lowers the amount you pay.
  2. Cost-sharing assistance — A discount that lowers the amount you pay for your deductible, coinsurance and copayments.

To get help paying for your health insurance costs, you must:

  • Have an income within a certain range for your household size.
  • Not be claimed as a dependent on someone else’s tax return.
  • Purchase a Silver plan on the Health Insurance Marketplace.
  • Be ineligible for a government-sponsored program or an employer-sponsored health insurance plan.

See if you qualify for a tax credit or cost sharing assistance. Or, you can apply online to get your official results.

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