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Your guide to buying individual health insurance

The open enrollment period this fall will be half as long as last year's. Other than that, health insurance shopping will be largely unchanged.

  • By
  • contributor
  • August 25, 2017

2018 Obamacare open enrollment

The Affordable Care Act’s open enrollment period is just around the corner. Concerned that you’ll be facing huge changes this year? Don’t be.

If you buy your health insurance in the individual market, it’s essential to understand that in terms of the big picture, little has changed. Despite the seemingly unending ACA repeal battle and constantly evolving predictions about the ACA’s future, the law remains fully intact.

The individual health insurance market is functioning the same way it has since 2014 – albeit with some new regulations. The start and end dates for open enrollment have changed several times since the first open enrollment in 2013, and they’ve changed again for this fall, as noted above (note that open enrollment will follow different schedules in some of the state-run exchanges).

Enrollment options haven’t changed

But the infrastructure and enrollment process remain unchanged. In a nutshell:

  • You’re still required by law to have ACA-compliant health coverage. If you don’t, you could face the individual mandate penalty. Calculate your penalty.
  • There is still open enrollment, and it’s still your only opportunity to buy coverage without a qualifying event.
  • Coverage is still guaranteed-issue, regardless of pre-existing conditions.
  • With the exception of later enrollments in the state-run exchanges that have opted to extend open enrollment, all plans purchased during open enrollment will take effect January 1, 2018. (A waiting period that Senate Republicans were considering for people who had a gap in coverage was not implemented.)
  • Premiums for older enrollees are still capped at no more than three times the premiums for younger enrollees.
  • All new major medical plans are still required to cover essential health benefits.

Premium tax credits survive repeal battle

There are still premium tax credits (aka, premium subsidies) available in the exchange for people with income up to 400 percent of the poverty level. (For 2018 coverage, a single person can earn up to $48,240 and be eligible for the premium tax credit, and a family of four can earn up to $98,400). Calculate your subsidy. (Note that 2018 data won’t be available until October, when rates are finalized.)

In 2017, 84 percent of exchange enrollees are receiving premium subsidies that cover an average of two-thirds of the total premiums.

The Trump Administration cannot eliminate the premium tax credits. They could be changed by legislation, but GOP efforts to do so stalled in Congress in late July.

Cost-sharing subsidies remain in place

Cost-sharing reductions (aka, cost-sharing subsidies) will continue to be available in 2018. This is essential to understand, as cost-sharing reductions have been the subject of a lot of the headlines over the last few months.

It’s true that President Trump has threatened on several occasions to cut off funding for cost-sharing reductions. But the coverage provided by the cost-sharing reductions will continue to be available in 2018, as it would take legislative action to end it. Even if the Trump Administration eliminates funding for cost-sharing reductions, people with income up to 250 percent of the poverty level will still have access to plans with reduced out-of-pocket costs.

Affordable premiums still in reach for millions

Given the premium volatility that we’re facing for 2018, it’s essential for anyone who is eligible for premium tax credits – or who might be eligible with an income fluctuation during the coming year – to enroll through the exchange. Don’t sign up for an off-exchange plan and miss out on the possibility of much more affordable premiums via a tax credit.

In general, the only people who should be enrolling off-exchange are those who are 100 percent certain that there is no way they will qualify for a premium tax credit during the coming year – keeping in mind that the premium tax credits are available well into the middle class, and will be larger in 2018 than they were in 2017 in order to offset the higher premiums.

Remember that you have an option to either have the premium tax credit paid directly to your insurer each month to offset the amount you have to pay in premiums, or you can pay full price for your coverage each month and claim the full premium tax credit when you file your tax return. But either way, it’s only available if you enroll in a plan through the exchange. If you buy your plan off-exchange, there’s no way to claim the tax credit at the end of the year, even if your income ultimately ends up at a level that would have been subsidy-eligible.

Exchange plans available in all U.S. counties

As of August 24, insurers are slated to offer coverage in the exchange in every county in the United States. Both sides of the political aisle have been addressing this issue all year.

While previously bare counties are currently filled, it’s also possible that more insurers could back out of the exchanges if the Trump Administration doesn’t commit to funding cost-sharing reductions. We’ll continue to monitor this and update our pages about the exchanges.

But for the time being, for the most part, nothing has changed. Most of the healthcare reform headlines from 2017 never came to pass. And although it will once again be necessary to compare plans in the exchange during open enrollment and potentially be willing to switch to a different plan in order to get the best value, premium subsidies will shield most exchange enrollees from the 2018 premium increases.

A guide to individual and family health insurance

As much as we love the Affordable Care Act, we know as well as anyone that the individual health insurance market continues to be a source of confusion for many, many consumers.

Since 1994, this web site has been a guide for consumers seeking straightforward explanations about the workings of individual health insurance – also known as medical insurance. Within this site, you’ll find hundreds of articles loaded with straightforward explanations about health insurance – and the health law – all written by a team of respected health insurance experts.

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