More and more employers today are adopting reimbursement models for their employees’ healthcare, empowering employees to choose their own individual health insurance plan and get reimbursed, tax-free, for their premium.
While this freedom is great for your healthcare, it can be daunting to shop for your own insurance plan if you’ve never done it before. While there are several ways to go about shopping for health insurance, the most common way is through the Health Insurance Marketplaces.
In this article, we’ll walk you through the five-step process so you can choose the right plan for you and your family.
Step 1: Go to healthcare.gov, or your state's individual Health Insurance Marketplace website
After the Affordable Care Act (ACA) was passed, the online Health Insurance Marketplaces were created to help Americans sign up for their own individual health insurance. Usually, you’ll only be able to sign up for a plan during open enrollment period at the end of the year.
However, if your employer just offered you a reimbursement plan, like a health reimbursement arrangement (HRA), then you qualify for a special enrollment period that allows you to shop for a plan outside of the normal enrollment period.
Step 2: Complete the online application
The website will walk you through several questions to help determine your age, financial status, and location.
You can expect to provide the following information:
- Date of birth
- Social security number
- Tax filing status*
- Number of dependents*
- Current job and income information*
- Other income information such as pensions, rental income, alimony received, unemployment income, etc.*
- Current insurance information, if applicable, such as how you are insured (employer, Medicaid, individual health insurance, etc.)*
- Payment information, such as a credit card or bank draft (ACH) information
*These questions will only be asked if you are applying for federal assistance (premium tax credits, cost-sharing, Medicaid, CHIP, etc).
Aside from your tobacco use, there won’t be any questions about your medical history. The ACA has mandated that no one will ever be charged more for insurance because of their health, so there’s no need to worry about having any medical records on hand. All in all, the application should take you between 15 and 30 minutes.
Step 3: Choose a plan
Once you’ve filled out your application, you’re ready to choose a plan. The website will display all the available plan options within four metallic tiers: Bronze, Silver, Gold, and Platinum.
A Bronze plan will generally cost the least monthly, but you'll pay more when you receive medical care. This could be a good option if you don't plan on needing a lot of medical services, but want coverage if you’re in an accident.
On the other end, a Platinum plan will generally cost the most monthly, but you'll pay the least when you receive medical care. This could be a good option if you have a lot of medical needs or visit your doctor often.
It’s important to note that these metal tiers have nothing to do with the quality of care you’ll receive. They simply determine how you and your insurance company will split the costs of your healthcare.
If you’re worried about choosing a plan on your own, healthcare.gov has a number you can call to talk with a professional for free. If your organization is administering your HRA with PeopleKeep, you can get even more help with KindHealth. KindHealth is a health insurance concierge service that allows you to talk one-on-one with licensed health insurance professionals.
Step 4: Pay your first premium
All plans are “guaranteed-issue,” which means all individuals are accepted no matter what, so you won’t need to wait and see if your plan is accepted or not. Once you’ve selected a plan, the Marketplace will simply bill you for your portion of the premium and forward the payment to your new insurance carrier.
Once purchased, the plan is yours. Even if you leave your current job, your plan will stay with you since it’s not tied to your employment.
Step 5: Submit your premium for reimbursement
This last step is optional, but important if your employer offers an HRA. If you have an HRA allowance from your employer, you’ll likely be able to get a tax-free reimbursement on your premium.
All you need to do is submit documentation to your employer that shows the following:
- The premium amount
- The coverage date
- The insurance provider
After your employer reviews and approves the documentation, you’ll automatically get reimbursed every month up to your allowance amount. If your premium is more than your monthly allowance, then you’ll simply pay what’s left out of pocket.
Through the Health Insurance Marketplaces, it’s easier than ever to find an affordable plan that meets your unique healthcare needs. Even better, if your employer offers an HRA, you’ll pay even less out of pocket for your monthly premium, maybe even nothing at all!