alabama guide to health insurance

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Alabama health insurance exchange / marketplace

As of Jan. 30, AL enrollment 146% of 2014 total

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Alabama residents are seeing more choices and slightly higher prices during the second open enrollment period on the health insurance marketplace. You have until Feb. 15 to participate in open enrollment.

UnitedHealthcare joined the exchange for 2015, and its plans are now available through the marketplace in all 67 Alabama counties. Previously, United policies were available only outside the marketplace.

Humana and Blue Cross and Blue Shield of Alabama, which dominates the health insurance market in the state, sold individual health insurance through the federal marketplace in Alabama for 2014. According to the U.S. Department of Health and Human Services (HHS), Alabama consumers had the fewest choices among the 37 states with partnership or federally facilitated marketplace for 2014 coverage. Historically, Alabama’s health insurance market has been considered one of the least competitive in the nation.

2015 enrollment update

HHS reported that 142,525 Alabamians signed up for private health insurance plans through 2015 between Nov. 15 and Jan. 30. During the entire 2014 open enrollment period, the total number of health plan signups in Alabama was 97,870.

You can change your auto-renewed plan

Experts are urging everyone to check their 2015 options. There are many reasons a new health plan may be a better choice: your personal situation changed, a new plan has a lower premium, or you qualify for a different subsidy amount.

Even if your 2014 plan was auto-renewed, you can still make a change up until Feb. 15. This section of explains your options and the process. If you don’t make a change by Feb. 15, you’ll only be able to change your plan if you qualify for a special enrollment period.

And even if you decide to keep your auto-renewed plan, make sure you update your income and household changes (like a marriage, a birth, or a new address). If you don’t update your information, you won’t get the right premium tax credit for 2015.

Slight rise in 2015 rates

A study by the Commonwealth Fund shows Alabama premiums increased just 3 percent from 2014 to 2015, which is much less than the increases seen in the years leading up to the passage of the Affordable Care Act. Rates for individual health insurance increased about 10 percent each year between 2008 and 2010.

Penalties rise for 2015

The individual mandate, which says you must have health insurance or pay a penalty, is one of the least popular features of Obamacare. However, just 1.4 percent of people will pay a penalty, according to the Congressional Budget Office.

For those who do have to pay, penalties increase for 2015. Those who don’t qualify for an exemption will have to pay the greater of:

  • 2% of annual household income. The maximum penalty under this calculation method is the national average premium for a bronze plan, which is just over $3,000 according to Exhibit 1 in this Commonwealth Fund analysis.
  • $325 per adult or $162.50 per child under 18. The maximum penalty per family using this method is $975.

Use the penalty calculator to see how much you may owe.

Coverage for small businesses

Through the federal Small Business Health Options Program (SHOP) exchange, small businesses with 50 or fewer employers can now shop online for health insurance coverage. Small employers and non-profit organizations can shop on their own or work through a broker or agent. After the employer defines the plan to offer, employees enroll online through the SHOP.

There is no defined open enrollment period for the SHOP marketplace. Small employers can set up a plan anytime of the year.

Nearly 125,000 found coverage in 2014

Nearly 98,000 Alabama residents signed up for qualified health plans (QHPs) during 2014 open enrollment. That was about 21 percent of estimated 464,000 people eligible to use the marketplace, according to the Kaiser Family Foundation. Nationally, about 28 percent of eligible people enrolled in a health plan through the ACA marketplaces. In addition, Kaiser also reported 22,564 Alabamans qualified for either Medicaid or the Children’s Health Insurance Program (CHIP) under existing eligibility criteria.

Alabama’s uninsured rate dropped 2.6 percentage points following the 2014 Obamacare open enrollment period, falling to 15.1 percent as of mid-2014 based a Gallup survey. The 2.6 point drop is slightly above the average decrease seen in other states that defaulted to the federal exchange and/or did not expand Medicaid in 2014.

How Alabama is handling health care reform

The federal government operates the health insurance marketplace in Alabama, based on Gov. Robert Bentley’s November 2012 decision against a state-run marketplace. Bentley cited annual operating costs of up to $50 million as his reason for opting for a federally operated exchange.

The decision against a state-run exchange came somewhat as a surprise. While the Republican governor consistently opposed many provisions of the Affordable Care Act, he repeatedly expressed support for a state health insurance exchange. He supported exchanges during his campaign for governor, and as governor, he used an executive order to establish the Alabama Health Insurance Exchange Study Commission. In November 2011, that commission unanimously recommended Alabama implement a state-run exchange. However, bills to establish a state-run exchange failed to pass in both the 2011 and 2012 sessions.

Bentley also opposed Medicaid expansion, and his position became the subject of campaign ads, editorials, billboards, and websites during 2014. Late in 2014, Bentley reintroduced a discussion on Medicaid expansion. Bentley said his administration will explore options to obtain federal Medicaid funding for a state-designed solution with a work requirement for recipients. Conservative groups promptly accused Bentley of flip-flopping.

An August 2014 study published by the Urban Institute shows the impacts of not expanding Medicaid. In Alabama, about 254,000 people will not qualify for Medicaid coverage through 2016. In terms of financial impact, the authors calculated that while Alabama would spend $1.08 billion to expand Medicaid over a ten-year period, the state is losing out on $14.4 billion in federal spending and state hospitals are losing $7.0 billion in reimbursement over the same period.

Alabama health insurance exchange links

Alabama Department of Insurance – Health Insurance Reform Information Center

State Exchange Profile: Alabama
The Henry J. Kaiser Family Foundation overview of Alabama’s progress toward creating a state health insurance exchange.