Open enrollment for the third year of "Obamacare" starts November 1st, and if you want your coverage to start on January 1, 2016, your enrollment deadline is December 15th. (Final deadline is January 31, 2016 for coverage starting March 1st.) The penalty for not having insurance coverage rises to $695 per person ($347.50 per child under 18) or 2 percent of MAGI (whichever is greater) for 2016, so it's important to get in on the open enrollment period.
Over the past three years, insurers have learned a lot about how people actually use their insurance coverage, so this year there are big changes in the kinds of coverage being offered, and the pricing. So, even if you already have an "Obamacare" policy, it is important to shop to make sure you have the most appropriate and least costly plan. You can do that at the government website,
www.Healthcare.gov or at state health exchange websites, or at large private sites like www.EHealth.com.
Here are five things to focus on when choosing your 2016 healthcare plan:
1. Don't just focus on monthly premiums. The most obvious comparison is the monthly cost of the policy. But it's really the total potential cost that matters if you have to actually use your insurance. Many plans have low monthly premiums, but very high deductibles and co-payments. The websites mentioned above will allow you to compare potential costs based on your assessment of your health situation, and potential services needed.
2. Consider the subsidies. The premiums on all policies may look expensive at first - but you could qualify for a premium subsidy based on your income level. That subsidy is applied directly to the monthly premium, based on your estimate of 2016 income. If you earn more, you will be billed for the subsidy reduction, and if you earn less, you will get a refund.
3. "Silver" plans get Cost-Sharing Reductions. In addition to premium subsidies, there is another important way to reduce the cost of your insurance through Cost-Sharing Reductions (CSR), which are based on your income. To qualify, your income must be between 100 percent and 250 percent of the Federal poverty level (for an individual or household). These CSRs can cut your co-payments in half, and cover a significant portion of your deductible. BUT, you can only qualify for CSRs if you purchase the "silver" tier of coverage. Silver plans likely have higher monthly premiums - but the cost reductions can make them less expensive in the long run.
According to eHealth.com, the average deductible for a Silver plan in 2015 was $2,975. But those who qualify for CSR could cut that number to as low as $1,000.
4. Consider the Coverage. After several years of experience, insurers are re-organizing the kinds of coverage they offer. There has been a 40 percent decline in offerings of PPO plans, which allow you to choose almost any physician and/or hospital. They have been replaced by more restrictive HMOs, which limit care to specific providers, and require you to coordinate care through a primary physician. There are also fast-growing EPO plans, which similarly limit care to an exclusive network but don't require a primary physician to coordinate all of your care.
5. Drug and Doc "tools." Both Healthcare.gov and sites like eHealth.com offer easy comparison tools, not only for monthly premiums and out-of-pocket expenses, but to allow you to search for physicians and hospitals covered by the plan so you can continue your current relationships. And they also offer a new tool this year, similar to the Medicare Part D tool, that shows you which of your drugs the Obamacare plan covers and what co-payments are required. All of these should factor into your ultimate decision.
It all seems very complicated, but it's important to compare. Private websites charge the same prices, but give you a dedicated agent to help you through the process.
It's worth the time to choose the plan that works for you -- not only based on monthly premiums, but on lowest out-of-pocket costs so you won't hesitate to actually use the insurance you buy. And that's The Savage Truth.