What is a Health Insurance Exchange?

A health insurance exchange is an online platform where people can compare health insurance plans and costs. It is also commonly referred to as a health insurance marketplace. Here, small businesses, families, and individuals can:

  • Get answers to questions they may have about health insurance
  • Compare different health insurance plans and find one that best fits their needs at an affordable price
  • Find out whether they are eligible for tax credits to to reduce premium cost or insurance such as Medicaid
  • Enroll in a health insurance plan that fits their needs

Private Exchanges vs. State & Federal Insurance Exchanges

In most cases, the term health insurance exchange is used in reference to State and Federal run exchanges, which the government developed as a result of the Affordable Care Act (ACA), commonly referred to as Obamacare. However, there are several private health insurance exchanges available. These are usually designed to serve companies, so you are only likely to encounter them if you’re signing up for work-based health insurance.

State and Federal run insurance exchanges are essential for enrolling in family and individual health insurance plans that are ACA compliant. A public health insurance exchange is the only place where you can obtain cost-sharing reductions and premium subsidies. These benefits serve to reduce out-of-pocket costs and premiums for millions of eligible individuals.

Understanding the ACA Health Insurance Marketplace

The healthcare insurance marketplace is a vital component of the Affordable Care Act healthcare reform, which was passed into law in 2010. The law required that states set up exchanges where families or individuals without employer-sponsored insurance coverage could compare and enroll in suitable insurance plans. However, many states opted not to establish private marketplaces and decided to join the federal exchange instead.

How Can You Benefit from the Insurance Marketplace?

The health insurance marketplace facilitates competition among private insurance companies while allowing individuals and families to easily find a plan that caters to their needs. The marketplace has an enrollment period that runs annually from November 1st to December 15th before the year in which the coverage is set to be effective.

During this period, individuals can compare plans and apply for the one that best fits their needs. It is also possible to apply for a special enrollment period in the case of a qualifying event known as a QLE:

Insurance plans in the marketplace are categorized into four tiers: platinum, gold, silver, and bronze. Platinum is the highest tier, and it includes plans that cover up to 90% of all health expenses. However, it is the most expensive tier of coverage.

Families and individuals with lower income can qualify for extra savings on any insurance plan offered in the health insurance market through cost-sharing reductions and premium tax credits.

Requirements of the Health Insurance Marketplace

There are several requirements for the insurance companies that offer coverage under the health insurance marketplace, as well as the individuals and families who use the platform. To qualify for an insurance coverage plan offered on the marketplace, you must be a U.S. citizen living in the United States. Individuals covered by Medicare are ineligible.

Plans offered on the marketplace can vary tremendously. However, the ACA requires each to satisfy at least ten essential health benefits or basic requirements. The benefits include:

  • Hospitalization
  • Ambulatory patient services
  • Pediatric services
  • Emergency services
  • Prescription medications
  • Rehabilitative and habilitative services
  • Laboratory services
  • Chronic disease management, preventive, and wellness services
  • Substance use and mental health disorder services
  • Pregnancy and maternity services and newborn care

Get a Professional to Guide You through the Insurance Marketplace Today

At DesignTM Health, we understand that choosing an appropriate health insurance cover from the flooded insurance marketplace is not a walk in the park. For this reason, our experts will help you identify and enroll in the most suitable coverage based on your needs and those of your family. Please contact us today to get a free quote and consult with our health insurance experts.

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