No matter how you feel about the Affordable Care Act (ACA), if you need health insurance, you’re going to have to learn the ins and outs of Obamacare.
With the Open Enrollment Period (OEP) coming up (between November 1, 2020, and January 31, 2021), you should take the time to get familiar with the terminology before you review your options, identify potential changes to your policy or move to a more affordable plan or one with better coverage.
Use this dictionary of open enrollment terms to help:
- Affordable Care Act (ACA), also referred to as Obamacare, is a health care reform law that went into effect in 2010.
- Catastrophic Health Plans provide coverage for major medical events. With high out-of-pocket costs, the plan’s monthly premiums are lower. The benefits meet the ACA’s coverage requirements, so you won’t incur a tax penalty; however, you can’t apply a subsidy toward it. In addition, the plans are only for applicants under the age of 30.
- Coinsurance is the amount you have to pay aside from a deductible or copayment. With an 80/20% plan, for a $100 medical bill, you’d owe $20 in coinsurance. Your coinsurance responsibility will apply towards meeting your Maximum Out of Pocket expense.
- Copay is a cost to you and may apply when you visit a doctor’s office or purchase medications. A co-payment is a cost in addition to your deductible and coinsurance.
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- Deductible is the amount of money you have to pay out-of-pocket every year prior to your health benefits paying for medical costs.
- Health insurance marketplace, or the exchange, is the place where consumers can shop for health insurance.
- Health Maintenance Organization (HMO) plans can be more affordable, but consumers get less flexibility and choice of doctors and hospitals. HMO Plans require you to stay in-network to receive benefits and provide no coverage for non-emergency out of network care.
- Health Savings Account (HSA) was created so that individuals covered by qualified high-deductible plans can establish an HSA and receive tax-prefered treatment of money saved to pay for medical expenses.
- Maximum Out-of-Pocket (MOOP) is the annual limitation for all costs you are responsible for under your health insurance plan. These costs include copays, deductibles, coinsurance and services not covered by your plan.
- Open Enrollment Period (OEP) is a window of time where families and individuals can purchase a Qualified Health Plan (QHP), switch plans or insurance companies, and reapply for their subsidy. For 2021, the OEP will be from October 1, 2020 to December 15, 2020.
- Pre-existing condition is a medical condition, diagnosis or treatment you received before your health insurance coverage began. Under the ACA, insurance companies won’t preclude you from getting coverage based on a pre-existing condition or charge you a higher rate.
- Qualified Health Plans (QHP) are major medical health plans that meet the mandatory benefit requirements of the ACA and allow subsidies or tax credits to apply.
- Subsidies are available to qualifying consumers to help reduce the cost of their health insurance. Also called tax credits, the amount of subsidy received is based on projected Modified Adjusted Gross Income, age, smoking status and the number of members in the household claimed for tax purposes.
- Preferred Provider Organization (PPO) plans typically reduce out-of-pocket costs compared to health plans that allow patients to choose to work any provider. However, PPO’s offer more flexibility than other plans, like an HMO.
- Special Enrollment Period (SEP) is reserved for individuals who have a life-changing or “qualifying-life” event to accommodate the need to buy or change health insurance. These events include losing your health coverage, moving, getting married or having or adopting a child.
- Tax penalty is what you’ll pay if you don’t have health insurance coverage for a period of more than three months in a calendar year, or you have a plan that doesn’t meet ACA standards. The tax penalty is prorated based on the months you were without qualified health insurance coverage.
Keep this open enrollment terms article handy. As you’re learning about Obamacare, open enrollment, and your health insurance needs, you can refer back to it as necessary. If you’d like to talk to one of InsureOne Benefits experts, feel free to give us a call.