It’s that time of year again…
No, unfortunately, I’m not talking about the holidays. It’s the time of year when we need to start thinking about healthcare coverage for the next calendar year.
Now that the health insurance marketplace is open, you probably have some questions about how the process works and how to find the best medical insurance for you and your family.
You might even be wondering how to choose a medical insurance plan that makes the most financial sense for your budget!
In this article, we’ll do a deep dive into the various factors and industry jargon that savvy planners may want to consider.
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What Are the Key Dates and Deadlines for Health Insurance for 2022?
We are now in the middle of open enrollment.
Open enrollment refers to a window of time that only happens once a year. This is when you have the opportunity to sign-up for a new medical insurance plan. If you have existing coverage, you can also adjust your current plan or cancel it altogether.
This window is important, because if you miss open enrollment, you may have to wait until the next enrollment period to make any changes.
Here are key dates to keep in mind:
- December 15, 2021. Do you want your health insurance coverage to start immediately in the new year? If so, then you’ll need to enroll or change your plan by December 15, 2021. This is the absolute last day to ensure your family has coverage beginning on January 1, 2022.
- January 1, 2022. This is when health insurance coverage begins. Your first premium must have been paid in full.
- January 15, 2022. If you miss the December 15 deadline, this is the final deadline for coverage in 2022. Because this date is after the new year, coverage will begin on February 1, 2022, for anyone who enrolls between December 15 and January 15.
- February 1, 2021. Health coverage begins for those who enrolled during the second window. If someone is unable to purchase health insurance within the time parameters above, the only way you can enroll or change plans is if you qualify for a Special Enrollment Period.
Who Qualifies for the Special Enrollment Period?
Ideally, you want to enroll in the health insurance marketplace during the Open Enrollment Period. Doing this helps prevent a potential lapse in coverage as the new year begins.
… but, it’s no secret that life happens and can get in the way of accomplishing our to-do list.
If for whatever reason you are unable to sign-up for health insurance during the Open Enrollment Period, you may still qualify for a Special Enrollment Period.
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There are 6 situations in which you may qualify:
- Loss of qualifying health coverage: accepting a new job, decrease in household income, losing coverage from under your parent’s health plan, etc.
- Change in household size: getting married, having a baby or adopting a child, becoming a dependent due to child support, etc.
- Change in the primary place of living: moving to a home in a new zip code, moving because of seasonal employment, moving due to education, etc
- Change in eligibility for Marketplace coverage or help to pay coverage: becoming an American citizen, being released from jail, gaining status as a federally recognized tribe (i.e. Native Americans), etc
- Enrollment plan error: being enrolled in the wrong plan due to error or misinformation, being able to prove that your Marketplace plan violated its own contract, etc.
- Other situations: being a victim of domestic abuse, being able to prove that you had “exceptional circumstances” that prevented you from being able to sign-up during the Open Enrollment period, etc.
If you missed the Open Enrollment dates and believe you qualify for a Special Enrollment Period, you have two options.
The first is to visit https://www.healthcare.gov/screener/ and answer a few questions. This screener will help you determine whether or not you qualify.
The second option is to call the Marketplace Center at 1-800-318-2596. When you call the number, be sure to tell the representative that you believe you qualify for a Special Enrollment Period. They will ask you a few questions to verify whether or not this is the case.
What is a Health Insurance Premium? What’s the Average Premium?
When it comes to health insurance, your “premium” is just a fancy word for the amount you’ll pay every month.
There are many factors that affect your premium. Age is one of the largest factors, as older people tend to pay 3X more than younger enrollees. Another factor is your location. Different states have different rules, which impact the competition and options you have available in the health marketplace.
What’s the average medical insurance premium?
In the last calendar year, the average premium for individuals is $456 per month. For families, the cost is $1,152 per month.
However, just because you have health insurance, it doesn’t mean that all of your health services will be “free” or covered. There are still costs you will have to pay out of pocket. Let’s explore those considerations below!
What is a Deductible? What is the Average Deductible?
A deductible is how much you pay directly to your health service provider before your insurance kicks in and pays its portion of the cost of covered services.
Yes, I know that’s a mouthful…
Here’s an example of how it works, which I think will help clarify things:
Let’s say you purchase health insurance through the Marketplace. If your plan has an annual deductible of $5,000, this means that you must pay $5,000 out of pocket until your insurance kicks in and pays its share of covered services.
It’s important to note that your deductible is paid directly to your primary care physician, provider, or hospital. Once you pay $5,000, then insurance takes care of the rest.
Each insurance plan has a different way it handles deductibles, so be sure to read the fine print. For example, maybe your insurance will pay 50% of the cost of services until you reach your deductible. In this scenario, once you reach your deductible, then insurance would cover 100%.
In general, the higher your deductible, the lower your premium. The opposite is typically true: the lower your deductible, the higher your premium.
Over the last calendar year, the average deductible for individuals is $4,364 and $8,439 for families.
What is a Copay?
Copay is short for “co-payment.”
This is a fixed cost that is paid by you for different services.
Again, this payment goes to your provider, not the insurance company itself. Copays will differ based on the service you need.
Standard check-ups, for example, typically have lower copays whereas emergency room visits have higher copays.
Most people end up paying a $30-$50 copay for the average annual wellness visit.
What is an Out-of-Pocket Maximum?
It’s no secret that healthcare is expensive!
But here’s the good news:
There is a maximum limit to what you will pay.
For the 2022 calendar year, the out-of-pocket maximum for individuals is $8,700 and $17,400 for a family.
This means that if an individual pays $8,700 in costs for healthcare services, they’ve reached the “maximum” they’re allowed to pay out of pocket. Now, insurance will step in and cover 100% of the covered health costs for the rest of the calendar year.
The same concept applies for the $17,400 out-of-pocket maximum for families.
Any care covered by your insurance will be 100% covered, meaning you will never pay more than this maximum limit.
Where Can I Get Medical Insurance?
Most people opt to get health insurance from their employer.
However, if you’re self-employed or want to research other options for you and your family, the best place to do this is through the official Health Insurance Marketplace.
The entire process is simple and can be done directly on the Health Insurance Marketplace website.
To avoid confusion, it’s important to note that there are multiple names for the federal Health Insurance Marketplace. It’s also simply called the “Marketplace” or the “Exchange.” This is where you can research and purchase a plan available through the Affordable Care Act, which is colloquially known as “Obamacare” or the “ACA.”
Get Health Insurance Now!
Choosing the right health insurance plan is key to your family’s physical health as well as your financial health!
I hope this article helps you better understand the Marketplace and the considerations to keep in mind.
If you have already enrolled in coverage for next year, do you have any tips for those shopping for coverage?
If so, please feel free to share your insights and experiences in the comments below! You never know who your comment might help!