Frequently Asked Questions

answers to questions about obamacareIt’s easy to get lost when you’re trying to navigate your way through the world of health insurance. While the Affordable Care Act or ACA (Obamacare) has made health insurance more accessible than ever before; the rules, regulations, and requirements connected to the Affordable Care Act has a lot of people scratching their heads in confusion. In order to help you understand what the Affordable Care Act means to you, Insurance Benefits Team has put together a list of the most frequently asked questions related to the AFA.

Click the topics below to reveal the frequently asked questions for each subject. If you need further clarification just give Insurance Benefits Team a call at: 817-367-7764 or use send a message through our Contact page. We’re here to help.

What is the health insurance Marketplace?

The Health Insurance Marketplace (also known as Exchanges) is the federal gov’ts website. It is the online website designed to assist individuals in determining whether or not they qualify for a federal subsidy to help pay for health insurance. This website was set up to create a more organized and competitive market for buying health insurance. It will offer a choice of different health plans, certifying plans that participate and providing information to help consumers better understand their options. Through the Marketplace, individuals and families will be able to shop for coverage if they need to buy health insurance on their own. Note that individuals will also be able to shop for plans and receive the subsidy if they qualify by also shopping with the various insurance companies and with licensed agents as needed for assistance in understanding the process. Premium and cost sharing subsidies will be available through the new law to reduce the cost of coverage for individuals and families, based on their income. Individuals and families with very low incomes will also be able to find out at the Marketplace if they are eligible for coverage through Medicaid and CHIP. Finally, small businesses can also buy coverage for their employees through the Small Business Health Options Program (SHOP) Marketplace, this option was delayed until 2015 in the state of Texas. There will be a health insurance Marketplace in every state for individuals and families and for small businesses. Some Marketplaces will be operated by the State and have a special state name (such as CoveredCalifornia or The Maryland Health Connection.) In other states where the federal government runs the Marketplace, it will be known called The Health Insurance Marketplace of [state name.]

Can I buy or change private health plan coverage outside of Open Enrollment?

In general, you can have a special enrollment opportunity to sign up for private, non-group coverage during the year, other than during Open Enrollment period, if you have a qualifying life event. Events that trigger a special enrollment opportunity are:

  • Loss of eligibility for other coverage (for example if you quit your job or were laid off or if your hours were reduced, or if you lose student health coverage when you graduate) Note that loss of eligibility for other coverage because you didn’t pay premiums does not trigger a special enrollment opportunity
  • Gaining a dependent (for example, if you get married or give birth to or adopt a child). Note that pregnancy does NOT trigger a special enrollment opportunity.
  • Divorce or legal separation
  • Loss of dependent status (for example, “aging off” a parents’ plan when you turn 26)
  • Moving to another state or within a state if you move outside of your health plan service area
  • Exhaustion of COBRA coverage
  • Losing eligibility for Medicaid or the Children’s Health Insurance Program
  • For people enrolled in a Marketplace plan, income increases or decreases enough to change your eligibility for subsidies
  • Change in immigration status
  • Enrollment or eligibility error made by the Marketplace or another government agency or somebody, such as an assister, acting on their behalf.

Note that some triggering events will only qualify you for a special enrollment opportunity in the health insurance Marketplace; they do not apply in the outside market. For example, if you gain citizenship or lawfully present status, the Marketplace must provide you with a special enrollment opportunity. When you experience a qualifying event, your special enrollment opportunity will last 60 days from the date of that triggering event. States have flexibility to expand special enrollment opportunities for consumers. Check with your State Marketplace for more information.

What health benefits are covered under the new law?

All qualified health plans offered in the Marketplace will cover essential health benefits. Categories of essential health benefits include:

  • Ambulatory patient services (outpatient care you get without being admitted to a hospital)
  • Emergency services
  • Hospitalization
  • Maternity and newborn care (care before and after your baby is born)
  • Mental health and substance use disorder services, including behavioral health treatment
  • Prescription drugs
  • Rehabilitative and habilitative services and devices (services and devices to help people with injuries, disabilities, or chronic conditions gain or recover mental and physical skills)
  • Laboratory services
  • Preventive and wellness services and chronic disease management
  • Pediatric services, including dental and vision care

The precise details of what is covered within these categories may vary somewhat from plan to plan.

What’s the penalty if I don’t have coverage?

The penalty for not having minimum essential coverage is either a flat amount, or a percentage of household income, whichever is greater. The penalty will be phased in. In 2014, the penalty is the greater of:

  • $95 for each adult and $47.50 for each child, up to $285 per family, or
  • 1% of family income minus the federal tax filing threshold, which is $10,000 for a person who files singly, $20,000 for somebody who files jointly

In 2015, the penalty is the greater of:

  • $325 for each adult and $162.50 for each child, up to $975 per family, or
  • 2% of family income above the federal tax filing threshold

In 2016, the penalty is the greater of:

  • $695 for each adult and $347.50 for each child, up to $2,085 per family, or
  • 2.5% of family income above the federal tax filing threshold

In later years, the flat penalty amounts for 2016 will be indexed based on the cost of living. In all years, the penalty is also capped at an amount equal to the national average premium for the lowest cost bronze health plan available through the Marketplace. The penalty is assessed based on “coverage months.” This means that each month you are uninsured, you may owe 1/12th of the annual penalty. However, short spells of non insurance may not be subject to a penalty.

Are there exemptions to the penalty? What are they?

Yes. You may be eligible for an exemption if you:

  • Cannot afford coverage (defined as those who would pay more than 8 percent of their household income for the lowest cost bronze plan available to them through the Marketplace)
  • Are not a U.S. citizen, a U.S. national, or a resident alien lawfully present in the U.S.
  • Had a gap in coverage for less than 3 consecutive months during the year
  • Won’t file a tax return because your income is below the tax filing threshold (In 2013, the tax filing threshold is $10,000 for individuals and $20,000 for a couple)
  • Are unable to qualify for Medicaid because your state has chosen not to expand the program
  • Participate in a health care sharing ministry or are a member of a recognized religious sect with objections to health insurance
  • Are a member of a federally recognized Indian tribe
  • Are incarcerated

Others who do not qualify through these categories but have experienced a hardship that makes it difficult to purchase insurance may apply through the health insurance marketplace for an exemption to the individual responsibility requirement.

What counts as Minimum Essential Coverage to satisfy the requirement to have health insurance?

Most people with health coverage today have a plan that will count as minimum essential coverage. The following types of health coverage count as minimum essential coverage:

  • Employer-sponsored group health plans
  • Union plans
  • COBRA coverage
  • Retiree health plans
  • Non-group health insurance that you buy on your own, for example, through the health insurance Marketplace
  • Student health insurance plans
  • Grandfathered health plans
  • Medicare
  • Medicaid
  • The Children’s Health Insurance Program (CHIP)
  • TRICARE (military health coverage)
  • Veterans’ health care programs
  • Peace Corps Volunteer plans

Be aware that outside of the Marketplace, other policies be for sale that may look like health insurance (such as short term individual policies, or policies that only cover cancer.) These kinds of products are sometimes referred to as “excepted benefits.” They do not count as Minimum Essential Coverage.

When can I apply for Marketplace premium tax credits when other coverage is available?

In general, if you have any of the following types of coverage, you would be ineligible for premium tax credits through the Marketplace:

  • Employer-sponsored coverage, unless the coverage is unaffordable (your required contribution to premium for self-only coverage costs more than 9.5% of household income) or does not meet minimum value (an actuarial value of less than 60%). Special rules apply when the affordability of family coverage is a concern.
  • Government-sponsored coverage, including Medicare Part A coverage, Medicare Advantage plans, Medicaid coverage and the Children’s Health Insurance Program coverage, Veterans health coverage and TRICARE (coverage for members of the military)
  • Coverage for Peace Corps volunteers

My family and I are offered health benefits through my job, but we can’t afford to enroll. My employer pays 100% of the premium for workers, but contributes nothing toward the cost of adding my wife and kids. Can we try to find a better deal in the Marketplace?

You can always shop for coverage on the Marketplace, but your family members won’t be eligible for tax credits to help pay the premium. When people are eligible for employer-sponsored coverage, they can only qualify for Marketplace premium tax credits if the employer-sponsored coverage is unaffordable. The way this is calculated, coverage is unaffordable only if your cost for coverage for a single person under the employer plan is more than 9.5% of your income. So although you may feel your family coverage is unaffordable in practical terms, it is considered technically affordable. If your family members end up uninsured because family coverage is unaffordable, they will not have to pay a tax penalty under the “individual mandate.”

What income is counted in determining my eligibility for premium tax credits?

Eligibility for premium tax credits is based on your Modified Adjusted Gross Income, or MAGI. When you file a federal income tax return, you must report your adjusted gross income (which includes wages and salaries, interest and dividends, unemployment benefits, and several other sources of income.) MAGI modifies your adjusted gross income by adding to it any non-taxable Social Security benefits you receive, any tax-exempt interest you earn, and any foreign income you earned that was excluded from your income for tax purposes. Note that eligibility for Medicaid and CHIP is also based on MAGI, although some additional modifications may be made in determining eligibility for these programs. Contact your Marketplace or your state Medicaid program for more information.

I understand eligibility for premium tax credits is based on our household income. Who counts as being in my household?

A household, for purposes of determining eligibility for premium tax credits, includes any individuals for whom a taxpayer claims a personal exemption on the federal tax form. That includes yourself, your spouse, and dependents. Dependents include children who meet certain requirements:

  • U.S. citizen or resident of the U.S, Mexico or Canada
  • Live with you for more than half the year
  • Under age 19 at the end of the year (or under age 24 if a full-time student); a child is considered to live with the taxpayer while he or she is temporarily away from home due to education, illness, business, vacation or military service.
  • Doesn’t provide more than 50% of his or her own support

Other individuals who can count as dependents include relatives, in-laws or full-time members of your household who are:

  • U.S. citizen or resident of the U.S, Mexico or Canada
  • Receive more than 50% of their support from you
  • Are related to you or live in your home all year
  • Make less than $3,900 (in 2013), generally excluding Social Security

A household can include individuals even if they are ineligible for tax credits (for example, individuals who are not lawfully present). Your household size can change during a year due to family changes, including the birth or adoption of a child, a child moving out of the house, and divorce or legal separation. When such changes take place you should report them to the Marketplace as they may affect your eligibility for subsidies. Family changes also can trigger a special enrollment opportunity when you can change health plans, even outside of the regular Open Enrollment period. Note that the definition of household for determining eligibility for premium tax credits sometimes differs from the definition of household for determining Medicaid eligibility. Ask your Marketplace for more information about who should be counted in your household. Keep in mind that if you estimate your income incorrectly and end up claiming more help than you are eligible for, you may have to pay back some or all of the premium tax credit you received. If you over-estimate your income and end up claiming less help than you are entitled to, the difference will be refunded to you when you file your income taxes the following year.

My partner and I live together but are unmarried. Is our combined household income what we should report?

Because you are not married, you will be considered two separate households for the purposes of determining eligibility for premium tax credits and Medicaid. Assuming that neither of you are claiming any dependents on your tax returns, you will each be considered as a household of one and your own income will be used to determine eligibility for premium tax credits and Medicaid as well as the amount of any premium tax credit and cost-sharing reduction you may qualify for. If you are eligible for premium tax credits, you will each receive a separate determination of the amount of your credit and whether you are eligible for a cost-sharing reduction. Whether you can use your credits to buy a family policy rather than two individual policies will depend on the offerings in your state Marketplace.

I can’t afford to pay much for deductibles and co-pays. Is there help for me in the Marketplace for cost sharing?

Yes. If your income is between 100% and 250% of the federal poverty level, you can also qualify for cost sharing reductions. These will reduce the deductibles, co-pays, and other cost sharing that would otherwise apply to covered services. The cost sharing reductions will be available through modified versions of Silver plans that are offered on the Marketplace. These plans will have lower deductibles, co-pays, coinsurance and out-of-pocket limits compared to regular Silver plans. Once the Marketplace determines you are eligible for cost sharing reductions, you will be able to select one of these modified Silver plans, based on your income level.

How do I appeal a Marketplace decision?

You can request an appeal of any Marketplace decision, including decisions about:

  • Your eligibility to buy coverage in the Marketplace
  • Your eligibility for, or the amount of, premium tax credits or cost sharing reductions
  • Your eligibility for an exemption from the penalty for not having health insurance
  • Untimely (late) notice from the Marketplace about a decision

To make your appeal, start by reviewing the Marketplace’s decision. You will have received the decision (called a determination notice) online if you initially applied online, or in the mail if you submitted a paper application. The notice will explain the reasons for the decision and the process you should follow if you want to appeal. To request an appeal, you’ll have to provide your name and contact information and an explanation of what you are appealing and why. You can make your appeal online or in writing or over the phone by calling the Marketplace call center. You can submit documents to the Marketplace that support your case. You can submit documents along with your initial appeal request or at any time during the appeal process, up until a hearing. The Marketplace may offer you the option of receiving temporary benefits while your appeal is pending. You can accept the temporary benefits or waive them. If you accept temporary benefits during the appeals process and then lose your appeal, you might have to pay back the benefits you weren’t eligible for. The Marketplace will review your completed appeal once it is submitted. Then the Marketplace will let you know its decision. If you still disagree with the decision, you can request a hearing. While you are waiting for the hearing to take place, the Marketplace may contact you to try to resolve the dispute informally. You may want to ask a Navigator for help requesting an appeal.

How long will the appeal take?

This will depend on the reason for your appeal and the documentation needed to decide your appeal. Contact the Marketplace for more information about your appeal.

What is a student health plan?

“Student health plan” refers to a special policy of health coverage that colleges and universities make available to their enrolled students. Typically the student health plan is different from the employer-sponsored group coverage that colleges and universities offer their faculty and staff.

Does a student health plan count as Minimum Essential Coverage?

Yes.

My partner and I are unmarried and we have two children. How do we count our household size and income when we apply for subsidies in the Marketplace? Can we buy one policy to cover the whole family?

Assuming you are eligible for premium tax credits, the amount of your credit will be calculated based on how you file your taxes. If for example, you each claim one of your children, you each will be considered as a household of two. The income of each household would be evaluated separately to calculate eligibility for and the amount of premium tax credits and cost-sharing reductions. Using a different example, if you claim both children as dependents on your tax return, then you and your children will be considered a household of 3, your income will be the basis for determining subsidy eligibility for the 3 of you. Your partner will be a household of one and his/her eligibility for premium tax credits will be determined separately. As for the type of coverage your family can purchase, that may vary based on the Marketplace rules where you live. For example, some insurers may offer family coverage only to married couples. If you buy one policy for the entire family, all the tax credits you are eligible for can be used to reduce the premium for that policy. If you buy separate policies, you can allocate the premium tax credits across two plans.

Can immigrants enroll in Medicaid or Children’s Health Insurance Program (CHIP) coverage?

Most lawfully present immigrants who meet Medicaid and CHIP program requirements, such as income and state residency, can enroll in Medicaid or CHIP after they have been in the United States for 5 years or more. Some groups of lawfully present immigrants do not have to wait five years before they may enroll in Medicaid and CHIP. These include refugees, asylees, and other humanitarian immigrants; veterans and military families; and pregnant women and children in some states. Some lawfully present immigrants who are authorized to work in the United States cannot enroll in Medicaid, even if they have been in the country for five or more years. Undocumented immigrants may not enroll in Medicaid or CHIP coverage.

Can immigrants buy health insurance through the new Health Insurance Marketplaces?

Most lawfully present immigrants can buy health insurance through the new Health Insurance Marketplaces. This group includes lawfully present immigrants who cannot enroll in Medicaid. Undocumented immigrants may not purchase coverage through the new Health Insurance Marketplaces.

I work full time for a large employer (more than 50 full time employees). Is my employer required to offer me health benefits?

Your employer is not required to offer health benefits. However, starting in 2015, large employers that don’t offer health benefits to their full-time employees and to their dependent children may be liable for a tax penalty. If your employer doesn’t offer you health benefits, you can apply for coverage in the Marketplace; and, if your income is between 100% and 400% of the federal poverty level, you may apply for a premium tax credit that may reduce the cost of coverage in the Marketplace. Note that a full-time employee is one who works, on average, at least 30 hours per week. If your hours vary during the year, your employer may have some options in determining your status as a full-time or part-time worker. Your employer can tell you whether you are a full or part-time worker.

I work full time for a small business (fewer than 50 employees). Does my employer have to offer me health benefits?

No, small businesses are not required to offer health benefits to either full-time or part-time employees, or to their dependents. Small businesses are not subject to tax penalties when they don’t offer health benefits. If your small employer doesn’t offer health benefits, you (and your family) can apply for coverage in the Marketplace; and, if your income is between 100% and 400% of the federal poverty level, you can apply for a premium tax credit that may reduce the cost of coverage in the Marketplace.

Apparently my family isn’t eligible for subsidies in the Marketplace because I am eligible for self-only coverage at work that is considered affordable. But we can’t afford to buy Marketplace coverage on our own. Will I have to pay a penalty because my family members are uninsured?

No. Because the amount you would have had to pay to actually cover your spouse and kids was more than 8% of your family income, they won’t be penalized for not having health coverage.

I’m 62 and already collecting Social Security. Are my Social Security benefits counted in determining my eligibility for subsidies in the Marketplace?

Yes, Social Security benefits are counted as income in determining eligibility for premium tax credits in the Marketplace.

I’m a retired Veteran collecting VA pension and benefits. Are those benefits counted in determining my eligibility for subsidies in the Marketplace?

Yes, VA pension benefits, like Social Security benefits, are counted as income in determining eligibility.

I am covered by Medicare. Can I keep my Medicare coverage even though these marketplace plans are available, or do I need to make a change?

Yes, you can keep your Medicare and you do not need to make any changes to your coverage because of Obamacare. You may have heard about the new requirement that all adults need to have health insurance coverage (known as the “individual mandate”) or have to pay a penalty if they go without health insurance, but your Medicare coverage satisfies this requirement. So if you have Medicare, this penalty won’t apply to you.

I am covered by Medicare, but I’m wondering if I can purchase one of the health plans offered through the marketplace and drop my Medicare coverage? Is that an option for me or should I keep my Medicare?

If you have Medicare, you should keep it. In fact, companies that sell marketplace plans are prohibited from selling these plans to you if they know you are covered by Medicare. If you do drop Medicare, and choose to re-enroll months or years later, you may face a penalty for late enrollment.

I am 65 years old, but I am not entitled to Medicare because I did not work long enough to qualify. Can I sign up for a marketplace plan?

Yes, in general, people age 65 or older who are not entitled to Medicare can purchase health insurance coverage in the marketplace (except undocumented immigrants). If you sign up for a marketplace plan, you will be eligible for premium tax credits to make the coverage in the marketplace more affordable if your income is between 100% and 400% of the federal poverty level (about $11,500 to $46,000 for an individual in 2013).

My income is uneven during the year. Some months I don’t earn anything, other months are better. I’m pretty sure my 2014 income will be less than 400% of the FPL so I’d like to apply for premium subsidies. But what if I’m wrong and my income ends up being more than 400% FPL?

It’s common for income to fluctuate, particularly if you are self-employed, perform seasonal work or have multiple jobs. To achieve the most accurate premium tax credit amount, you should report income changes to the health insurance Marketplace during the year, as they happen. Otherwise, if you claim a premium tax credit during the year and your actual 2014 income edges over 400% FPL, you will need to pay back the full credit amount. To avoid this result, if you estimate your 2014 income will be close to 400% FPL, you could also consider waiting until you file your 2014 taxes to take all or a portion of the premium tax credit on your tax return instead of receiving advance payments.

Can I adjust the level of subsidy I collect in advance during the year when my income goes up or down? How often during the year can I make adjustments?

Yes, you can make adjustments during the year whenever you need to. There is no limit to the number of times a person may report income, family or insurance-eligibility changes to the Marketplace. Changes that are reported by enrollees will be verified by the Marketplace. Then the Marketplace will send you a notice (called a redetermination notice) showing your revised eligibility for premium tax credits and cost-sharing reductions. In addition, people can always ask the Marketplace to provide them with a monthly advance premium credit below the amount the Marketplace determines based on the household’s income if they want to minimize the chance of needing to owe money at the end of the year.

If I request an adjustment in my Marketplace premium subsidy, how long before that takes effect?

The adjustment will take effect by the first day of the month following the date of the redetermination notice. For example, if an enrollee reports a change in income on June 25 and the Marketplace verifies the change and sends a redetermination notice to the enrollee on July 3, the change will be implemented on August 1.