What Is a Monthly Premium? Your monthly premium is the set amount you pay each month to have your plan. You pay it even if you don’t receive any medical care that month. Like other bills, this premium can rise when it’s time to renew your plan for the next year. For individual ACA compliant plans, premiums are based on a pre-approved age based grid. When you enter a age on the grid, your premium will increase on your bill.
What Are Out-of-Pocket Costs? Out-of-pocket costs are what you must pay when you get care. These costs depend on how much care you actually get and if you have a yearly out-of-pocket maximum. Once you hit that limit, your insurance pays for all of your care. That is called the maximum out of pocket or MOOP. There are 3 types of out-of-pocket costs before you satisfy the MOOP:
Deductible: The set amount you usually pay for care before the insurance starts helping with the cost. Premiums and copays don’t count towards this deductible amount.
Copay: The set fee you pay each time you use a certain medical service covered by your plan. You either pay this or coinsurance.
Coinsurance: The percentage of the cost you pay each time you use a certain medical service covered by your plan. Coinsurance usually comes following the deductible. You either pay this or a copay.
Fun Facts:
- Many plans have out of pocket maximums that only include in network care.
- Health care services that are NOT covered by the plan do NOT count towards the out of pocket maximum (MOOP).
- Most plans have mitigation features to reduce out of pocket expenses such as network tiering, utilization management, step therapy and quantity limits on medications.
Can I Get Help with Costs?
You may qualify for help paying for insurance through the government. Any help you get only helps pay for on exchange or Marketplace plans. The credit you receive is based on the second-cheapest silver plan available to you. No matter what plan you choose, you’ll get the same amount of credit.
What Is the Advanced Premium Tax Credit? The Advanced Premium Tax Credit is a subsidy that’s applied directly to your monthly premiums in advance. This is often referred to as the subsidy. Your household income determines your eligibility.
TAX CREDIT FUN FACTS:
- Many sole proprietors qualify for significant tax credits.
- . Some people choose to take the tax credit immediately applied to their premiums while others wait until the prepare their annual taxes. Both work but…
- You MUST enroll through a health insurance exchange to qualify for credits, advanced or not. You cannot enroll direct and get the tax credit.
- There is an additional subsidy call Cost Sharing Reductions that some will qualify for.
What Is The Cost Sharing Reduction ?Cost sharing assistance limits the plan’s maximum out-of-pocket costs and lowers the cost of essential health benefits. You may qualify for it if you:
- Have income below the threshold of 250% of FPL.
- Enroll on a Silver Level Plan
What Are Other Programs That Can Help? You may also qualify for:
- Medicare for those 65 and older, disabled, or with end stage renal disease
- Medicaid for people with limited incomes
- Children’s Health Insurance Program (CHIP) for children in low-income families
Of course there is no ” one size fits all” when it comes to health insurance. When it comes to selecting a plan for you and your family it’s best to take advantage of the services of an independent broker who specializes in health insurance like the team at Total Benefit Solutions, Inc. Call us today for your free help (215)355-2121.
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