Health Insurance Marketplace Explained

Affordable Care Act a.k.a. Obamacare has created a new category of health insurance policies. These new policies will be sold on Health Insurance Marketplace. Health Insurance Marketplaces are also called Health Insurance Exchanges in some states.

Health insurance companies will continue selling their traditional health insurance plan. But some of them will also sell a new category of plans called qualified insurance plans through Health Insurance Marketplaces.

As per the provisions of Obamacare, Health Insurance Marketplace will start offering health coverage from January 1, 2014. What are marketplace health plans and how will they affect you? Before I go into the details let me share some key dates and resources.

  • Health Insurance Marketplace will start open enrollment from October 1, 2013. Prices (premium) for marketplace health plans will be available from the same date.
  • Some (but not all) plans will start offering coverage from January 1, 2013.
  • Open enrollment will close on March 31, 2014. Those who miss this deadline can enroll only if they have a qualifying life event like death or birth in the family, job loss, moving to a new state,  change in income, and divorce.
  • The Health Insurance Marketplace’s official website is located at HealthCare.gov and I suggest you visit it. As per my understanding this is a federal government website. You should also subscribe to email updates from HealthCare.gov.
  • States are creating their own health insurance marketplaces. You should check out your state’s marketplace website. For example Covered California is the Golden State’s website.

The graphics below explains how health insurance marketplace works.

How health Insurance Marketplace Works

How Health Insurance Marketplace Works. Image Courtsey: HealthCare.gov.

So What is Health Insurance Marketplace?

It offers affordable (lower cost) private health insurance to individuals, families, and small businesses. Health insurance is offered by private companies.

Health Insurance Marketplace simplifies the process of buying health insurance. The applicant needs to fill only one application to see all options.

The marketplace is administered by federal or state government. The marketplace is divided into two parts.

1. Marketplace for Individuals and Families

The marketplace allows individuals and families with low income to buy high quality and affordable health insurance. Health insurance marketplace for individuals and families will have two unique features.

  • Health insurance companies will not reject applicants for past & preexisting conditions, age, and high risk.
  • Individuals and families qualify for lower premium and out of pocket costs based on annual income.

2. Marketplace for Small Businesses

 Who Runs The Marketplace?

The marketplace is run by the State government or the federal government. If your state government is running the marketplace then you should visit the state government website for details. Else you should visit healthcare.gov.

If you live in the following states you should use HealthCare.gov.

Alabama, Alaska, Arizona, Arkansas, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Michigan, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Jersey, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, and Wisconsin.

If you live in the following state then use your state’s Health Insurance Marketplace website.

State Health Insurance Marketplace
California Covered California
Colorado Connect for Health Colorado
Connecticut Access Health Connecticut
District of Columbia DC Health Benefit Exchange
Hawaii Hawaii Health Connector
Idaho Idaho Health Insurance Exchange
Kentucky Kentucky Health Benefit Exchange
Maryland Maryland Health Connection
Massachusetts Health Connector
Minnesota MNsure
Nevada Nevada Health Link
New Mexico New Mexico Health Insurance Alliance
New York New York Health Benefit Exchange
Oregon Cover Oregon
Rhode Island Rhode Island Health Benefit Exchange
Vermont Vermont Health Connect
Washington Washington Health Benefit Exchange

Who Can Find Coverage Through Marketplace?

Anyone can buy from the marketplace. The marketplace offers standard policies with transparent pros and cons. Those who don’t have insurance because they can’t afford it or the carrier will not cover will benefit the most.

What is Open Enrollment Who Can Enroll?

Open enrollment is explained in detail here. Anyone can enroll.

Will All Health Insurance Companies Participate?

No, all health insurance companies will not participate in Health Insurance Marketplace. Participation for health insurance companies is not mandatory. For example in California United Healthcare and Aetna are not participating in the marketplace and will stop selling individual health insurance from January 1, 2014.

 

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