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How To Get The Cheapest Health Insurance Rates

FPL Guidelines Obamacare

Save money on your individual or family health insurance coverage. You can now instantly compare the most affordable plans from multiple companies, and easily enroll for coverage. Online shopping for medical benefits saves you time and money. Pre-existing conditions are covered on all qualified on and off Marketplace policies and you can preview 2016 and 2015 prices.

The combination of the new federal tax subsidy (Obmacare) and properly enrolling in the right plan, provides quality comprehensive contracts at the cheapest available price. You no longer have to meet underwriting guidelines to qualify, and there are options available for everyone's budget. Even if you miss the Open Enrollment deadline, many low-cost plans are offered.

A "Special Enrollment Period" is offered to any individual that qualifies for special "life-changing events." For example, having a baby, moving to a different state, losing existing medical benefits through your employer, and becoming divorced, will generate the exception. You will have approximately two months to choose an Exchange policy offered in your state.

Free Subsidy Money

Understanding the Federal Government Marketplace subsidy and how to use it, is a great place to start. To qualify, your household income must be between 100% and 400% of the Federal Poverty Level. OK. So What are the magic numbers and what happens if you are just above or just below the limits? And what if your state expanded Medicaid eligibility?

The graphic below (courtesy of CAHBA) shows the different income levels that will earn financial aid. For example, a household with four family members and an income above $95,000 may not qualify. However, a five-member household can earn about $110,000. There are additional variables that must be considered, including the ages of the adults, zip code, and cost of benchmark coverage (second-lowest Silver plan). Each state will have different levels of eligibility. And each year, the formula slightly changes.

Federal Poverty Guidelines For Subsidy (Click For Full View)

Even though this aid is classified as a tax credit, the actual money is deducted directly from your health insurance premium. Therefore, you do not have to wait to file your taxes in order to receive reimbursement. If you over-estimate your income when calculating the subsidy, the following year, an adjustment will be made. Likewise, if you underestimate the subsidy, a credit will be given.

If you have a significant change in income during the year, you can request to increase or lower your current subsidy. Also, an event may occur during the calendar year that changes the amount of subsidy you may receive. For example, you may unexpectedly retire. or get a raise. A dependent may move out of the home, or you may sell assets that result in a large capital gain. All of these situations allow you to adjust the level of financial aid you are receiving, even if the Open Enrollment period has ended.

Don't Forget Tax Forms

Two tax forms are required to be filed the year after you receive a federal subsidy. Form 1095-A is used to enter household income and plan information. The date is then transferred to Form 8962 (Premium Tax Credit) which references your subsidies. There also is a new entry on the 1040 tax form requesting if you secured healthcare coverage. If you answer "no," an additional tax will likely apply to your household income.

NOTE: If you overestimate or underestimate your household income, and therefore received an incorrect amount of subsidy, the following year when you file your taxes, the shortfall (or credit) will be adjusted. This will result in an increased refund, or a higher amount of taxes owed. There is no penalty, assuming you were not fraudulently and deliberately miscalculating the subsidy.

Bigger Credits For Bigger Families

Since all household members are considered, regardless if they are applying for coverage, obviously the larger the family, the bigger the subsidy will be. Therefore, if one spouse is retired and already receiving Social Security benefits (and Medicare), or they are covered under a group plan, it still helps when determining how much money you will receive. Or, if one or more children are covered under CHIP or Medicaid, your subsidy will be increased. Typically, if they appear on your federal tax return, they count towards calculating the subsidy.

Also, if you declare these children as dependents on your tax return, even if they are over the age of 18 and not a full-time student, it will increase the amount of your "free money." However, income that your children earn may have to be counted in the subsidy calculation. Of course, typically, the amount of money they make is easily offset by your tax credit reimbursement. However, if one child earns significant income, it will impact the subsidy that the entire family receives.

The Hidden Silver Plan Gem

The Silver plan is one of four "Metal" policies available when you choose coverage. The others are Platinum, Gold and Bronze. A special "Catastrophic" option is available for persons under age 30. Any company that wants to participate in the Marketplace must offer consumers at least one Silver and Gold plan. Many carriers choose not to offer Platinum and Catastrophic options since they are the least popular.

Catastrophic policies are generally more expensive than Bronze plans and are rarely purchased. You also must be under age 30 to qualify (or prove "financial hardship"). However, the biggest deterrent from buying a catastrophic plan is that they are not eligible for federal subsidies. With most households, this single factor makes them very unattractive. And although preventative benefits are fully covered, most other expenses must meet a large deductible.

From an actuarial standpoint, Silver plans are expected to pay about 70% of your anticipated medical expenses. The remaining 30% consists of the deductible, copays, and coinsurance. Often the deductible is in the $3,500-$4,500 range and maximum family out-of-pocket expenses can be as much as $12,600 for a family. A single plan will have out-of-pocket limits about half the amount of a family policy.

The Joy Of A Silver-Tier Plan

But here's the "hidden gem." The Silver option is the only Metal policy with "cost-sharing." If your household income is below 250% of the Federal Poverty Level, than you can drastically reduce the deductible and copays. Here's an example:

Suppose you lived in Indianapolis and your family consisted of two adults in their late 40s. The household income was $27,000 and pre-existing conditions prevented you from qualifying for coverage prior to 2014. And you could not afford to pay a large deductible (such as $5,000) if you had a major claim.

Cost-Sharing Exchange Plan Options

The "Silver" Metal Plan Features Cost-Sharing

The Anthem Silver Pathway X 10 plan usually costs approximately $900 per month with a $3,000 deductible. But the subsidy  "cost sharing" reduces the deductible down to $1,150 and the premium to only $169 per month. That's a savings of more than $9,000 per year and the deductible drops by more than 55%. If the income increases to $37,000, the subsidy is still more than $10,000 and the deductible also reduces.

Amazingly, if you selected the Ambetter Balanced Care 1 plan, The premium would reduce to $149 with a deductible of only $150. And your office visit copay would

be only $1. No, that is not a misprint! The specialist visit copay would only be $5. Ambetter offers very similar options in most of the states it offers coverage. NOTE: In several states, including California and Arizona, the reductions of deductibles and out-of-pocket expenses will not be as significant.

Bronze Metal Plan Options

Bronze Exchange policies are often the least expensive policy you can purchase, unless your low income can qualify for a "catastrophic" plan. Why are Bronze options the cheapest? Because, actuarially, it is calculated that you will have to pay approximately 40% of your medical expenses out of your own pocket. Thus, as opposed to the 30% (Silver), 20% (Gold) or 10% (Platinum) contracts, your risk is higher. And the deductibles are often applied to office visits and prescriptions, and not just major medical events.

But what if you had no serious medical issues and you were unlikely to incur enough expenses to meet a smaller deductible such as $1,500 or $2,500. Of course, you would select a higher deductible (perhaps $3,500, $5,000 or higher), and pocket the savings. If a serious medical condition developed, each Open Enrollment you can choose to switch to a different policy, that may be more cost-effective in covering your new expenses.

That's the concept of the Bronze Metal plans. Your worst-case scenario is $6,600 of medical expenses (that's the law per individual) that you are unlikely to incur. Therefore, why pay for benefits that you probably will not utilize? And since this type of plan is likely thousands of dollars less in premiums (family plans), you can pocket the difference as a reward for your good health.

Important Note: Bronze-tier plans often require that you meet a deductible before utilizing two very expensive benefits -- Specialist office visits and non-generic or brand-name prescriptions. Thus, if you anticipate needing either of these coverages before the next Open Enrollment, paying a bit more for a Silver-tier policy may save you money. Often, if you take multiple brand drugs with no generic substitute, purchasing a Silver-tier policy may be more cost-effective.

Medicaid Expansion

In many states, the expansion of Medicaid has created unique opportunities for low-income families to qualify for free healthcare benefits. The threshold for determining who qualifies (and who is denied) has changed, and Medicaid enrollments have increased in every state. Actual expansion and liberalization of eligibility guidelines has taken place in about 30 states.

How To Reduce Healthcare Prices

Where Do Your Healthcare Dollars Go?

The states that have not expanded (yet) would like to transfer the matching Medicaid funds so their state residents can purchase coverage through the Exchanges. It's not a bad idea, assuming the benefits provided equal or exceed coverage that would have normally been furnished. And since more doctors, specialists and hospitals would be made available, network coverage would increase.

Often, individuals or couples in their 50s and 60s will surprisingly qualify. It's also possible that the following year, your income may change, and you will  be able to buy subsidized coverage through Exchanges. Since it's a fluid process, it's important to review choices before Open Enrollment each year.

Also, Medicaid expansion often provides a significant economic impact to states. The increased revenue expands and creates jobs, especially in the healthcare industry. Previously unemployed workers can also find lower-paying jobs that don't provide medical benefits, but do provide badly-needed income for their household. And with free preventive benefits provided, a larger portion of the population is healthier.

Short-Term Options

Temporary medical plans are the least expensive type of coverage offered by the large reputable companies. They are typically used when there is a short-term gap in benefits. Often, these gaps are a result of  job loss, graduating college and waiting for employment to begin, seasonal layoff from work, job termination or waiting for Medicare coverage to start. Also, many uninsured persons will simply wait until the next Open Enrollment before purchasing coverage.

Although extremely cheap, these policies are not Affordable Care Act-compliant, and therefore do not include all 10 required "essential health benefits." You can keep your policy for up to 12 months, but the benefits-paid cap is often between $250,000 and $1 million, and a deductible applies to all claims. Pre-existing conditions are not covered. Young adults often use  temporary coverage (details here ), because of the low premiums.

But the rates are very affordable! Listed below are monthly rates  for a UnitedHealthcare short-term (Value option) policy for 45 year-old male living in Columbus, Ohio. Prices are  predominately based on age, smoking status, and zip code. Several other companies offer temporary plans that include additional riders that can be added.

$56 -- $5,000 Deductible

$69 -- $2,500 Deductible

$91 -- $1,500 Deductible

$106 -- $1,000 Deductible

Short-term policies are often approved within 12-24 hours of the application submission and are quickly underwritten. Quite simply, there are about six medical questions (along with a few administrative questions). If you are able to answer all questions "no," you will be approved. Other major companies that offer competitive rates besides UnitedHealthcare include Blue Cross, Companion Life, IHC Group, and HCC Life.

The cheapest Health Insurance Exchange rates will save you hundreds, or perhaps thousands of dollars, compared to more expensive plans you may currently have. Get your free quotes, compare quality plans and save! We specialize in providing consumers with the most affordable plan options in their area, and customizing coverage to best match your budget and any pre-existing condition.


February 2015 -- Open Enrollment for 2016 policies will now start on November 1 (2015) and run though January 31st. The extra 15 days will provide consumers some additional time to shop and purchase coverage. Bad weather and conflicting dates with Medicare Supplement sign-up were two of the main reasons for the change.

Special Enrollment Period (SEP) situations will continue throughout the entire year for persons that lose coverage through an employer, or qualify for one of several available exemptions. In the event of a birth of a child after the OE period, the newborn is eligible for an SEP, but not the parents. Also, when a child reaches age 26, although they are eligible for an SEP, the parents mut retain their original policy.

March 2015 -- Any person that did not have coverage in 2014 and is subject to the "shared responsibility payment," can purchase qualified plans from March 15th to April 30th. You must have been "unaware" of the taxes and penalties that would result by noncompliance.

To qualify, you can not presently be enrolled in an approved Exchange or non-Exchange plan, and must verify that you filed your 2014 federal tax return and paid all applicable penalties or fees. Consumers who live in a state with a federally-facilitated Marketplace can take advantage of this offer.

June 2015 -- The cheapest health insurance rates just got a little more expensive! Well, actually, prices are going up in 2016 as most companies have requested premium increases for next year. It's now up to each state's DOI to approve in full, partially approve, or deny these requests. Typically, most of the increases are granted, assuming the carrier can prove they suffered an underwriting loss.

Category: Insurance

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