Change Is Coming To Healthcare.gov. Here's What Freelancers Need To Know.

Photo via  Burst

Photo via Burst

A new year is around the corner and with it comes a new round of changes to the Health Insurance Marketplace (healthcare.gov). As a licensed health insurance advisor, I’m here to help you sift through the rumors and lay down the facts. These are the topics self-employed people who have a healthcare.gov plan and those looking to obtain a healthcare.gov plan should be watching and what they may (or may not) mean for you.

Individual Mandate Update

Individual Mandate is the requirement by law for certain persons to purchase or otherwise obtain a good or service. Also known as Individual Shared Responsibility, Tax Penalty

Facts

  • In a recent tax bill passed by both chambers, the individual mandate will be eliminated, getting rid of the tax penalty for not having coverage. This takes effect January 1, 2019.

  • You may still be subject to the tax penalty if you do not have an ACA approved health care coverage for 2018, which will be evident when you file your 2018 taxes.

  • The current individual mandate penalty for 2018 is as follows: $695 per adult and $347.50 per child OR 2.5% of household income. Whichever is greater. Certain exemptions apply.

What this could mean for you:

This change may increase Marketplace (ACA, Obamacare) premiums by as much as 10% each year. This potential increase is because the current mandate helps to keep the risk pool for insurers balanced by having both young and healthy, the sick and old to obtain coverage respectively. When the penalty is removed, it is projected that young and healthy people will opt to not have coverage, which in turn, will make the pool less balanced resulting in more expensive medical costs and higher premium costs.

This may also prompt insurance companies to drop out of the Marketplace because they will still have to cover pre-existing conditions but can’t increase the premiums enough to cover all of the costs incurred by doing this.

Insurance companies or provider options in your area

Fact

  • 29% of consumers using ACA plans currently only have one provider option in their area.

What this could mean for you:

If providers opt to pull out of the Marketplace, there may be some people left with no options available in their area. f this is the case, there are areas that are expected to have a higher potential of this happening.

It also could mean that if you are currently on a Marketplace plan, that plan may not be available to you come November during open enrollment, forcing you to change plans and possibly networks. If you change networks, you may have to change your preferred physician if they don’t accept the coverage plan you change to.

Are subsidies going away?

A subsidy is a sum of money granted by the government or a public body to assist an industry or business so that the price of a commodity or service may remain low or competitive.
Fact

  • In a bill passed in 2017, subsidies are no longer being funded by the government. Individual health insurance providers are required to continue providing them, but are picking up the tab.

What this could mean for you:

If the companies are having to foot the bill on the subsidies which they are still required to provide, monthly premium rates will in turn increase for those that are not receiving the subsidies, because it is more expensive for the company to stay in business.

In my previous article “Understanding Your Healthcare Options As A Freelancer,” I explain how a subsidy is granted based on your projected household income for the year. So as a note, don’t just underestimate your income to get a subsidy, because when you file come tax time, if you have made more than what you “projected” you will be subject to paying that subsidy (part or all) back!

Minimum Essential Coverage

Fact

  • There are active  discussions based around if the Marketplace plans will be required to uphold the MEC guidelines and cover pre-existing conditions. We will continue to monitor and share any updates as they arise.

What this could mean for you:

Insurers are currently mandated to cover 10 essential health benefits. The list includes maternity, mental health, prescriptions, and annual wellness exams for all ages. With the possibility that these items will no longer be required to be covered, you may see increased out-of-pocket costs for these things.

It’s important to note that part of the reason premiums have become so expensive is partly due to the requirement to cover the list of 10 essential and pre-existing conditions. So removing the requirement may (or may not) adjust the costs of the premiums we will see come November during open enrollment.

What you can do to prepare

  • Do your research and utilize the healthcare.gov site to shop around with plans that are currently available.

  • If you currently have a Marketplace plan, call your current provider (Blue Cross Blue Shield, Ambetter, etc.) in the next couple of weeks and ask if your current plan will still be available for 2019.

  • Start deciding what you are actually able to spend on monthly premiums and what individual or family deductible is reasonable for your family.

  • Get in touch with an advisor now to prepare and help guide you through open enrollment. Just like tax season, it is better be established with an advisor before their busy season is in full effect.


JENNA LACY IS A LICENSED HEALTH INSURANCE ADVISOR WHO SPECIALIZES IN PROVIDING HEALTHCARE TO FREELANCERS AND THE SELF-EMPLOYED. CONNECT WITH JENNA ON LINKEDIN OR EMAIL HER DIRECTLY TO DISCUSS YOUR PERSONAL HEALTHCARE QUESTIONS AND OPTIONS.