Winter 2019

The MLO Minute: By Anthony Marone, Esq.

            Don’t miss your opportunity to enroll for the Affordable Care Act’s (“ACA”) Marketplace Health Insurance for 2020.  Open enrollment for the Marketplace began on November 1, 2019 and will be closing soon.  To obtain coverage in the Marketplace beginning in January 1, 2020, you must apply by December 15, 2019, less than 20 days away.  Many people will greatly benefit from the insurance coverage offered through the ACA.

 

            Each of the four insurance plans you can purchase on the ACA Marketplace offer coverage for ten essential health benefits as well as additional health benefits.  The essential benefits include hospitalization, emergency care, pregnancy care before and after birth, medication, laboratory services, and mental health and substance abuse treatment.  Additional benefits include birth control and breast-feeding coverage.  Many states have expanded coverage under the ACA and benefits may include vision and dental coverage.  The four insurance plans, called “metal” plans, all offer the exact same coverage as mandated by the Federal Government. 

           

            The difference between the metal plans is the increasing percentage of the cost of care paid by the insurance company versus the insured.  The ACA Marketplace four metal plans are the bronze, silver, gold and platinum plans.  Under the silver plan the insurance company will pay 70% while the insured will pay 30% of the cost of care.  Under the platinum plan, the ratio is 90% to 10%.  All the plans have co-pays, deductibles and premiums that must be paid by the insured.  The good news is Federal Government may subsidize the premiums and assist with the co-pays and deductibles the insured must pay, depending on his, her or the family’s income.

 

            One of the greatest benefits of the ACA Marketplace is that the cost of the insurance is subsidized by the Federal Government.  In Pennsylvania, any individual or family whose adjusted gross income is between 138% and 400% of the Federal Poverty Level (“FPL”) is potentially eligible to pay a greatly reduced premium for coverage.  The Federal Government issues a premium tax credit to those whose income falls in this range.  The lower the income, the higher the credit.  The premium tax credit can be taken as a tax deduction at the end of the year or can be used to reduce the amount of monthly premiums.  Under the silver plan, low income individual’s may also receive cost sharing reductions that could significantly lower the amount of deductibles and co-pays.  Eligibility for these important subsidies is tied to the insured’s estimated modified adjusted gross income (“MAGI”).

 

            Your adjusted gross income (“AGI”) is reported on Line 7 of your IRS 1040 Tax form.  Certain items of income must be added back into the AGI to calculate the modified adjusted gross income.  To estimate the correct MAGI, the insured must take into account raises and other expected changes in income for 2020.   An individual is eligible for the premium tax credit if his or her income, the MAGI, is between $17,236.20 and $49,960.00 annually.  A family of four will qualify for some amount of premium tax credit with and annual MAGI as high as $103,000.00.

 

            Of course, some people, like me, do not wish to spend their free time calculating their MAGI and comparing it to the FPL.  Help is available.  Begin by accessing the website at https://www.healthcare.gov/get-coverage/ .  You can search for local agents, brokers and assisters to help you apply and find a plan.  Before you apply, review the five tips found under the topic “Marketplace tips.”  You should gather the documentation and information on the checklist found at https://www.healthcare.gov/downloads/apply-for-or-renew-coverage.pdf .  You will need, for example, income information, employer information and the Social Security Numbers and dates of birth for all the members of your household.  Finally, choose how to apply at https://www.healthcare.gov/apply-and-enroll/how-to-apply/ .

 

            Not everyone will qualify to receive the ACA Marketplace Health Insurance.  An individual who receives Medicare or health insurance through an employer will not qualify in most circumstances.  An immigrant not lawfully residing in the United States will not qualify.  An individual or family whose MAGI income is less than 138% of the FPL will not qualify.  For Pennsylvania residents with a MAGI less than 138% of the FPL, they may qualify for the ACA Expansion Medicaid.  Unlike the Marketplace, the ACA Expansion Medicaid is free and you can apply at any time. 

 

            Access to health care is vital for everyone.  Whether you qualify for the Marketplace, Medicaid, Medicare, or an employer-based plan, your access starts with good insurance.  The only way to access the ACA Marketplace is to apply.  Don’t let this opportunity to obtain health insurance pass you by.  Time is running out.