Simplified Guide to Selecting a Plan from the Marketplace
1. If you already have a primary care physician, or know of one that you would prefer to see, find out what insurance they accept.
2. Go to www.healthcare.gov. This is the website for the Federal Health Exchange. You will immediately be asked to enter your state of residence. For this tutorial we will use California as our example. By selecting California on the federal site you will be redirected to www.coveredca.com.
Use the ‘Shop and Compare’ tool to get started. You’ll be asked for some basic information, like your age, zip code, gross income and size of household. Once you’ve completed this information you will be taken to a separate page listing the insurance providers that you can choose from. Premiums are broken down into monthly cost and are also given a quality rating. You can click on any of the plans displayed for more detailed information. Plans are divided into 4 tiers: bronze, silver, gold and platinum. These tiers correspond to the percentage of healthcare costs each plan will cover.
|Bronze – Covers 60% of healthcare costs.||Silver – Covers 70% of healthcare costs.|
|Gold – Covers 80% of healthcare costs.||Platinum – Covers 90% of healthcare costs.|
Once you’ve chosen an insurance provider, consider the amount of out-of-pocket costs you’re willing to incur and compare deductibles between the different coverage tiers. While the gold and platinum plans have little to no deductible, the bronze and silver plans do have a deductible and the difference between each plan can be significant. It is worth your time to thoroughly compare the differences between the bronze and silver plans, because while the silver plan will cost you slightly more per month the difference in the amount of coverage you receive could be substantial.
Also, depending on your level of gross income, you may qualify for a “Premium Tax Credit” (PTC). If your annual gross income is less than 400% of the federal poverty line relative to your family size you will be eligible to receive a PTC. The guide below serves as a quick reference in determining your credit eligibility.
|Size of Family||Poverty Line||400% Threshold|
3. If you do qualify for a PTC you will have the option to claim your credit in advance or wait to claim the credit on your tax return in the following year. Always take the advanced credit! There are reasons this could prove beneficial to you, aside from the most immediate reason of lowering your monthly out-of-pocket expense. When it comes time to file your tax return any PTC that you used throughout the year will have to be reported. If it is determined that you were eligible to receive a larger PTC than what you actually received, the difference will be a refundable credit to you. However, if it is determined that your PTC was more than what you were eligible to receive you may not have to pay back the difference in full. There is a cap on any excess payback depending on your level of gross income relative to the federal poverty line. See the guide below for a quick reference.
Limitation of Payback of Excess Advance Credit
|Household Income Relative to Poverty Line||All Filing Status Except Single
(Married, Head of Household, etc.)
|Less than 200%||$600||$300|
|At least 200% but less than 300%||$1,500||$750|
|At least 300% but less than 400%||$2,500||$1,250|
|400% or more||No Limit||No Limit|
**Remember that the deadline for enrollment in the Marketplace for 2015 is February 15, 2015.**