ACA Frequently Asked Questions

The Marketplace and the ACA

What are the important dates for enrolling in 2017 health coverage?

  • November 1, 2016 – Open Enrollment Period begins – First day to enroll, re-enroll, or change a Marketplace health plan for 2017.
  • December 19, 2016 – Last day to enroll for coverage starting January 1, 2017.
  • January 15, 2017 – Last day to enroll for coverage starting February 1, 2017.
  • January 31, 2017 – Last day of Open Enrollment. No plans may be purchased or changed after this date, unless you qualify for a Special Enrollment Period.

What are the different ways I can apply for coverage?

  1. Through the Health Insurance Marketplace
  2. Directly from an insurance company
  3. Through an insurance agent or broker
  4. Through an online health insurance seller

How do I keep or change my Marketplace coverage for 2017?

By now, you should have received notices from both the Marketplace and your insurance company specifying the following:

  1. Whether your plan is available for 2017 (and whether it’s changing)
  2. How much it will cost in 2017
  3. How to compare plans or change your current plan

You will likely be re-enrolled in your plan—or a similar plan—if you do nothing before December 15, 2016. However, it’s still important that you review new plans and prices and update your income and household.

Do I have to pay a penalty if I don’t have health coverage?

If you go uncovered for all or part of the year, you may have to pay a fee known as the individual shared responsibility payment. The fee is owed for any month you, your spouse, or your tax dependents don’t have health insurance that qualifies as minimum essential coverage under the Affordable Care Act, or “Obamacare,” as it is commonly known.

If you have a brief coverage gap of only 1 or 2 months, you can claim a “short gap in coverage” exemption to avoid the fee, provided you have a qualifying health plan the rest of the year.

You may also qualify for a health coverage exemption due to certain life events, health coverage, financial status, or group membership.

Will I save money on health insurance with a Marketplace plan?

You may be eligible for a premium tax credit if you purchase your plan through the Marketplace. To qualify, your estimated income must be between 100% and 400% of the federal poverty level (as determined by the size of your household).

You can use this tool from healthcare.gov to get a general idea of whether or not you’ll save.

(The tax credit is not available for plans purchased directly from an insurance company, a broker, or an online seller. It is only available if you purchase through the Health Insurance Marketplace.)

Short-Term Medical and ACA

What is short-term medical (STM) insurance?

Short-term medical insurance policies are designed to provide temporary coverage until you are able to secure long-term insurance.

These short-term plans are outside the scope of the Affordable Care Act and do not count as minimum essential coverage. They offer short-term coverage of less than 3 months for costs resulting from unexpected injury or illness, such as emergency room visits, hospitalizations, outpatient surgery, and lab/X-ray fees.

Short-term plans do not cover pre-existing conditions, they cannot be renewed, and they are not guaranteed issue. Short-term plans have these limitations due to their nature as gap-fillers for brief timespans when you would otherwise be uninsured.

Why isn’t STM compliant with the ACA?

Limited-duration policies are outside the scope of the Affordable Care Act.

Since they offer short-term coverage of less than 3 months for costs resulting from unexpected injury or illness, they do not provide all of the essential health benefits required in order to count as qualifying coverage under the ACA.

Short-term plans have these limitations due to their nature as gap-fillers for brief timespans when you would otherwise be uninsured.

If I purchase a short-term medical policy, will I still be subject to the ACA tax penalty?

Yes, you may still be subject to the ACA tax penalty if a short-term medical policy is your only health insurance throughout the year, or if you hold an STM policy for more than 2 months out of the year.

However, if you are without qualifying health coverage for just 1 or 2 months, you can claim a “short gap in coverage” exemption to avoid the penalty.

You can purchase short-term medical insurance to cover you during this gap and still be eligible for the exemption (provided the gap is no more than 2 months). In fact, these short gaps are the exact types of situations for which short-term medical insurance is intended.

When should I consider purchasing a short-term medical policy?

You should always choose to purchase an ACA-compliant health plan if the option is available to you.

You should only consider purchasing a short-term policy if:

  1. You’ve missed the Open Enrollment Period and you do not qualify for a Special Enrollment Period, Medicaid, or CHIP.
  2. You’ll experience a waiting period before your ACA-compliant coverage goes into effect.
  3. You’re looking to bridge a short gap when you would otherwise be uninsured.

The best approach to healthcare is to purchase an ACA-compliant health plan to cover you throughout 2017. Then purchase a short-term medical policy to cover you, if you would otherwise be uninsured, during the waiting period until your ACA plan goes into effect (usually 15 to 45 days).

 

Short-term medical (STM) plans provide temporary, short-term coverage of less than 3 months.  STM plans do NOT provide “minimum essential coverage” as defined in the Affordable Care Act ("ACA" also known as "Obamacare").  STM plans also do not cover pre-existing conditions, cannot be renewed, and are not guaranteed issue.

Please review the policy for additional exclusions and limitations. By purchasing an STM, you may still be subject to the ACA tax penalty for not maintaining minimum essential coverage. You should consult your tax advisor to determine if the ACA tax penalty applies to your specific situation.

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