Health Insurance Marketplace 2023 Explained
Al Waller: Fall is here again—which means it’s time for open enrollment for the Affordable Care Act Health Insurance Marketplace®. This period is especially important since many Americans don’t have access to affordable health insurance through an employer, Medicare, state or federal program like Medicaid, or other options— but they can get covered through the Health Insurance Marketplace.
Whether you’re self-employed, in between jobs, or cannot afford the policy your employer offers – or know someone who is in one of those situations, it’s important to know what’s available through the Health Insurance Marketplace.
Welcome to Clearpath – Your Roadmap to Health and WealthSM. I’m your host, Al Waller. Today, Mihaela Vincze, public health expert for nonprofit Transamerica Institute® is joining me, to discuss the importance of health insurance, provide an overview of the Affordable Care Act Health Insurance Marketplace, and outline key details for 2023 Open Enrollment — which is currently running now between November 1st and January 15, 2023 for most states.
Well, Mihaela, it’s nice to have you back.
Mihaela Vincze: Good to be here, Al.
Al Waller: Let’s begin by talking about the basics in terms of why health insurance is so critical.
Mihaela Vincze: Health insurance is a contract that requires your health insurer to pay some, or all your health care costs in exchange for the monthly payment you pay every month – also known as a premium.
In the aftermath of the COVID-19 pandemic, Americans nationwide are once again battling the impacts of inflation, and many people are feeling spread thin financially—thus it is critical to remember the importance of health insurance.
Let me give you an example, I once knew someone who had herniated a disk in their spine—which was leading to pain and weakness in their legs and back. It cost them thousands of dollars to get surgery and put them deep into debt.
It is easy to underestimate how much medical care can cost. For instance, getting surgery for a herniated disk, generally costs between $15,000 and $50,000 (USD) without health insurance. Health coverage can help protect you from high, unexpected costs. So, its important we sign up!
Al Waller: Exactly, and as we have noted in the past, when you’re young, you’re feeling healthy and invincible – it’s hard to see the value in applying your discretionary funds for something like insurance, but as you pointed out, health conditions can hit you from out of the blue and can be financially devastating.
Now, keeping that in mind and that 2023 Open Enrollment is between November 1st and January 15, 2023, could you walk us through an overview of the Affordable Care Act Health Insurance Marketplace and unpack the types of coverage available by starting with “What is the Health Insurance Marketplace?”
Mihaela Vincze: The Health Insurance Marketplace is also known as “Marketplace,” “health exchange” or simply the “exchange” and is a health insurance enrollment service through which people can purchase health insurance that fits their budget and needs.
Al Waller: Got it – and in that vein, let’s take a deep dive into 2023 Open Enrollment, which (to repeat) runs from November 1 to January 15 in most states. For the uninitiated, what exactly is an open enrollment period and for that matter, who is eligible?
Mihaela Vincze: Those who are 19 to 64 years old — who are not eligible for Medicare, Medicaid, and are without access to employer-sponsored health coverage— can sign up for a health plan through the Marketplace.
Also, if you’re already enrolled in a health plan, you can make changes to your existing health plan during the open enrollment period.
Al Waller: I see…then how would someone go about applying for or making a change in their health care coverage through the Health Insurance Marketplace?
Mihaela Vincze: Visit the federal Marketplace at HealthCare.gov for full details. Some states, for example, Maryland and California, require that you go to their state-run Marketplace website. If your state requires it, HealthCare.gov will direct you to this state-run marketplace website.
You can also check out Transamerica Institute’s Marketplace Open Enrollment Guide at transamericainstitute.org/openenrollment for your state’s specific market-place website.
Al Waller: Sounds pretty straight-forward. Could you walk us through how to go about selecting a plan?
Mihaela Vincze: Sure, the first thing you may want to do is start by comparing plans—even if you like the plan that you’re currently enrolled in. Plans are organized in tiers—bronze, silver, gold, and platinum.
A bronze plan, for instance, may be a desirable choice for those who are young and healthy— they have the least expensive monthly costs (or premiums) but higher deductibles. For those wondering what a deductible is—it is the amount paid by the policyholder before the insurance plan starts to pay.
So, for instance, if you have a thousand-dollar deductible, you would pay that out of pocket before your insurance kicks in.
Al Waller: Okay. I follow you there. Can you give us a brief overview of the other tiers you mentioned?
Mihaela Vincze: Yes, we have Silver Plans – these types of plans have a slightly higher monthly cost (or premium) with some cost-sharing benefit—“cost-sharing” is the share of costs covered by your insurance that you pay out of your own pocket.
Silver plans should be considered by those who expect some medical care, however, nothing significant.
Lastly, there are Gold and Platinum Plans. These types of plans are the most expensive monthly, but they have low deductibles and strong cost-sharing benefits. Someone who anticipates significant and costly medical care may want to look into these types of plans.
Al Waller: Great. Now that we’ve gone over the different tiers, what’s the next step in terms of what listeners should consider when choosing a health plan?
Mihaela Vincze: What might be helpful is to consider is what type of provider network you’d like to have covered— providers are the doctors, other health professionals, or hospitals that a plan contracts with to provide medical care to its members.
There are four main types of provider networks—Health Maintenance Organization (HMO), Exclusive Provider Organization (EPO), Preferred Provider Organization (PPO) and Point-of-Service Plans (POS).
Depending on the type of plan you buy, your plan may cover your care only when you see a certain network provider. You may also have to pay more, and/or get a referral if you choose to get care outside of that provider network— which would be considered an out-of-network provider.
Al Waller: Can you briefly identify how different types of plans use provider networks?
Mihaela Vincze: Sure— as I mentioned previously, there are four types of provider networks:
- Exclusive Provider Organization. You’re only covered if you use doctors, specialists, or hospitals in the plan’s network (except in an emergency).
- Health Maintenance Organization. You are limited to care from doctors who contract or work with the HMO and are not covered for out-of-network care (except in an emergency). You may be required to live or work in the HMO’s service area to be eligible for coverage.
Al Waller: Good to know that, as well. I think the next one up is Point-of-Service Plans – how do they line up?
Mihaela Vincze:
- Point-of-Service Plans. You pay less if you use doctors, hospitals, and other health care providers that belong to the plan’s network. You are required to get referrals from your primary care doctor to see specialists.
- Preferred Provider Organization. For an additional cost, you can use doctors, hospitals, and health care professionals outside of the network without a referral. You pay less if you use providers in the plan’s network.
It’s important to be aware of these different provider networks so that you can enroll in a plan that contracts with the hospitals, doctors, and other healthcare professionals that you want covered by your health plan.
Al Waller: Mihaela, thanks for breaking that down – that was a lot to digest. Now, is there anything else listeners should know and be aware of when selecting a plan?
Mihaela Vincze: Double-check that the health plan you select helps pay for the 10 Essential Health Benefits required by the Affordable Care Act. These include emergency services, hospitalization, and even mental health and substance use disorder services. They also include preventive and wellness services and even chronic disease management. Remember, there are ten of them, and you can find the full list of essential health benefits at HealthCare.gov.
Al Waller: Isn't there something that will help people identify doctors? I think it's called a provider directory?
Mihaela Vincze: Yes, you may want to review the “provider directory,” which lists all the doctors that participate in the plan’s network, just to confirm that any specific doctor or specialist that you would want to see is actually covered by your health plan.
One last thing to keep in mind when thinking about selecting a health plan – and I know this may sound obvious – just consider the costs that you are willing to pay.
Al Waller: Yes, I think most people would be doing that – but then again, it’s wise to adhere to a budget. But basically – look…your health…without that, you really don't have anything. So, you want to make sure whatever you decide to select and pay for, those adequately meet your needs.
So, now I'd like to discuss what to consider when determining the monthly cost.
Mihaela Vincze: It is important to think about the estimated yearly costs and not just the monthly premium. A quick refresher – premiums are the monthly costs you pay for your health insurance, and deductibles are the out-of-pocket costs you must pay for before health insurance begins to cover those medical expenses.
To decide if you want a high premium/low deductible plan or a low premium/high deductible health plan, consider how often you will be using health services.
Al Waller: That’s a great point. What kind of question should someone be asking themselves when considering a plan with a higher premium?
Mihaela Vincze: A plan with a higher premium covers a higher portion of your medical costs, and it may be appropriate if...
- You see a primary physician or a specialist frequently.
- You take expensive medications on a regular basis.
- You are expecting a baby or plan to have a baby.
- You have a surgery coming up.
- You need emergency care frequently.
- You’ve been diagnosed with a chronic condition.
Al Waller: Well, that makes a lot of sense. Are there any options for folks to manage their out-of-pocket expenses?
Mihaela Vincze: Some High Deductible Health Plans allow you to use the following alternative sources to help pay for your out-of-pocket payments:
- Health Savings Account (HSA): a type of savings account that allows you to set aside pre-tax money to pay for certain eligible medical expenses not covered by insurance.
- Health Reimbursement Arrangement (HRA): an arrangement which reimburses employees tax-free for certain eligible medical expenses, funded by your employer.
Al Waller: It’s helpful to know that there are actually options for lowering costs. Speaking of which, are there any new changes in 2023 that might just do that?
Mihaela Vincze: Yes. The Inflation Reduction Act extends eligibility for premium tax credits to reach people with incomes under $54,360 for a single person in 2023, or $111,000 for a family of four.
That’s not all, workers will now also be able to get marketplace subsidies if their share of the premium for their job-based coverage exceeds 9.12% of their expected 2023 income. This is because the Treasury Department recently finalized arule which is designed to address what has long been termed the “family glitch”.
The “family glitch” only considered self-coverage premium costs in the “affordability calculation”, not other family members. The change expands the number of families with employer-based insurance who can now choose to forgo their coverage at work and qualify for subsidies to get an Affordable Care Act (ACA) plan through the Health Insurance Marketplace instead.
Al Waller: This seems like a step in the right direction given that those families who were ineligible from getting federal subsidies to help them purchase ACA coverage in the past, may now actually qualify.
Since we’re now talking about 2023 changes, this brings me to my next question—is there a health insurance mandate or requirement set for next year?
Mihaela Vincze: Currently, there is not a federal mandate. However, there are some state-level mandates in California, Rhode Island, Massachusetts, New Jersey, Vermont, and the District of Columbia. Just keep in mind that even if there isn’t a mandate in your state, health insurance is so important to have— a single trip to the emergency room may actually exceed the annual cost of a health plan.
Al Waller: Having gone through a major surgery not that long ago, Mihaela – you don't have to sell me on that point! Now one last question before we wrap things up.
Let's say you missed the deadline and were unable to enroll during Marketplace Open Enrollment. What happens and what are your options?
Mihaela Vincze: If you miss your state's open enrollment deadline, you won’t be able to enroll in 2023 coverage unless you have a qualifying event for a Special Enrollment Period. Qualifying events may include getting married, having a baby, losing your health coverage, or moving to a new home.
Al Waller: Well, not to strike too fine a point here, but those seeking new health insurance coverage in the Marketplace or making changes to existing coverage should absolutely make certain to enroll during this window, November 1 to January 15, 2023.
Where can our listeners go to learn more?
Mihaela Vincze: HealthCare.gov is the federal health insurance exchange website, with so many great resources on this topic. And check out our Transamerica Institute Open Enrollment Guide @ TransamericaInstitute.org/openenrollment to learn more.
Al Waller: Well, Mihaela, again, great to be with you and many thanks for this comprehensive overview.
If you’d like to check out any of the source materials mentioned today, visit transamericainstitute.org/podcast to review the episode’s transcript.
If you have comments, feedback, or topic ideas, please reach out to [email protected]. Don’t forget to hit that subscribe button so that you don’t miss an episode of ClearPath—Your Roadmap to Health & Wealth.
And in case you missed them, be sure to check out our previous episodes on Cooking Healthy Recipes From Around the World and Life Insurance Explained. Also, in the coming weeks, we will be discussing mental health in the workplace and trends related to unpaid family caregivers.
ClearPath – Your Roadmap to Health & Wealth is brought to you by Transamerica Institute, a nonprofit private foundation dedicated to identifying, researching, and educating the public about health and wellness, employment, financial literacy, longevity, and retirement.
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ClearPath – Your Roadmap to Health & Wealth is produced by the Transamerica Institute with assistance from WYPR.
Until the next time, I’m your host Al Waller. Stay safe, be well and thanks for listening.
The information provided here is for educational purposes only and should not be construed as insurance, securities, ERISA, tax, investment, legal, medical, or financial advice or guidance.
