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Frequently Asked Questions
How much is health insurance?
Consumers spent an average of $3,667 annually on health insurance in 2020, according to the Bureau of Labor Statistics. But how much you’ll spend depends on whether you have coverage through your employer, a marketplace plan, or another organization. It can also depend on your age, where you live, if you smoke, the number of people enrolled, and the type of plan you select.
How do you get health insurance?
Many people get health insurance through their employer or through a spouse's plan. But if you don't have an employer (or a spouse with health insurance), you're probably eligible for coverage through the health insurance marketplace, or possibly your state's Medicaid program. Visit your state's health insurance marketplace or healthcare.gov to apply.
When is open enrollment?
The open enrollment period for your plan depends on whether it's through the health insurance marketplace, your employer, Medicare, or Medicaid. Open enrollment for marketplace plans is November 1 through December 15. For Medicare, it's October 15 through December 7. Enrollment periods for employer plans differ but are generally in the fall. If you're eligible for Medicaid, you can enroll anytime.
What is a health insurance deductible?
A health insurance deductible is the amount you need to pay out of pocket for certain covered services before your insurance coverage kicks in. For example, if your deductible is $500 for a $1,000 medical bill, you would pay the first $500 of that bill and your insurer would pay the rest, subject to any coinsurance percentage that applies. Preventative services often don't have a deductible.
How does health insurance work?
Health insurance pays for covered medical services in exchange for regular premium payments and cost-sharing mechanisms like copays, coinsurance, and deductibles. Like any type of insurance, it's there to protect you when you need it. Considering the high cost of medical care—a three-day hospital stay averages $30,000, for example—health insurance is an essential insurance for almost everyone.
When does health insurance expire after leaving a job?
Your coverage could end the day you leave your job or at the end of the month, but you may be able to extend it through COBRA for up to 18 months. Bear in mind, you’ll be responsible for the entire premium, which could increase your costs dramatically. Reach out to HR to find out when your coverage ends, if you’re eligible for COBRA, and how much you’ll have to pay for it.
Coinsurance is your out of pocket portion of a covered medical or health care cost after the deductible has been paid.
A high deductible health plan (HDHP) has lower monthly premiums and a higher deductible than other health insurance plans. The Internal Revenue Service (IRS) defines an HDHP as a plan with a deductible of $1,400 for one person or $2,800 for a family for the year 2021.
A health maintenance organization (HMO) is a type of health insurance plan designed to reduce medical costs by using a network of preferred providers and having members select a primary care doctor to coordinate their health care needs. HMOs are typically less expensive than other health insurance plans.
The health insurance marketplace is a state or federally run exchange where you can enroll in health insurance plans for yourself and your family.
COBRA stands for the Consolidated Omnibus Budget Reconciliation Act, a provision under federal law that requires private insurers for employer-sponsored group health plans to offer continuation of job-based health coverage if coverage is lost due to a qualifying event.
A point-of-service plan (POS) combines aspects of HMOs and PPOs to provide affordable in-network care to members while still providing the flexibility to seek care out of network.
PREMIUM TAX CREDIT
The premium tax credit is a federal refundable tax credit that lowers your monthly premiums on plans from the Health Insurance Marketplace. Your premium tax credit amount depends on your household income and other factors.
The Affordable Care Act (ACA) refers to the Patient Protection and Affordable Care Act, and is also called "Obamacare." It overhauled healthcare legislation to make health insurance more affordable and accessible, and provides numerous rights to healthcare recipients and applicants.
A preferred provider organization (PPO) is a health plan where an insurance company contracts with hospitals, doctors, and clinics to create a network of participating providers. These providers agree to provide medical care to plan subscribers at a negotiated rate.
CATASTROPHIC HEALTH INSURANCE
These plans are designed to protect you from extreme out-of-pocket costs for catastrophic health events. They are still required to meet the minimum essential benefits under the Affordable Care Act (ACA). But you will generally incur high out-of-pocket costs before you reach your (very high) deductible.