Health Insurance

Although most Americans get their medical and health insurance from an employer or from the government, individual health insurance is designed for people who are self employed or do not have access to an employer-sponsored or government health plan. Historically, individual insurance in almost all states involved medical underwriting prior to 2014, which meant that securing a policy was often difficult for people with pre-existing conditions.

Most health insurance companies are for-profit entities, and even non-profit carriers cannot operate at a loss. They have to take in more money in premiums than they pay out for medical claims. In the individual market, medical underwriting for personal health insurance was traditionally the way they accomplished this. People with pre-existing conditions could be declined for coverage or offered a policy with an increased premium or exclusion riders that eliminated coverage for pre-existing conditions.

When Should You Consider Personal Health Insurance?

If you are self-employed, or if your employer does not offer health insurance, you would be wise to ensure that you are covered by a health insurance plan to protect you, and your assets, against the cost of medical care, whenever the need arises. The cost of medical care, medical procedures, surgeries, operations, hospitalization, and medical care associated with such activities are some of the more expensive costs we can endure. Unexpected situations which require such care can literally cost us hundreds of thousands of dollars. All but the wealthiest among us need health insurance to protect against bankruptcy in the event of a serious illness or injury, and to secure access to expensive life-saving medical care if we need it. Although lawmakers saw that removing medical underwriting from the individual health insurance market was necessary in order to extend coverage to everyone, they also knew that this had the potential to create significant adverse selection in the market. There was just too much potential for people to wait to apply for a policy until they needed medical care, knowing that the coverage would be guaranteed issue.

​The Affordable Care Act (ACA) includes two provisions to prevent this: with very few exceptions, everyone is required to have health insurance or pay a penalty. The penalty was eliminated in 2019, under the terms of the GOP tax bill that was enacted in 2017. However, some states imposed their own mandate penalties starting in 2019. Plus, individual health insurance is only available for purchase during open enrollment windows (November 1 – December 15 in most states, with coverage effective the first of January). This is the ideal time to buy health insurance and compare plans and options.

​Types of Health Insurance:

Individuals & Families

Individual health insurance is available both in and out of the Health Insurance Marketplace or exchanges.  Individual ACA-compliant plans are rated with “metal” designations, which helps consumers compare apples to apples. There is plenty of variation from one carrier to another, both in terms of plan design and price, but policies are labeled based on their actuarial value, or the percentage of costs that the plan covers across an average population. Several state-run exchanges have additional plan standardization in place. This includes low-cost health insurance for residents meeting the criteria. Bronze plans will cover roughly 60 percent of costs, Silver plans 70 percent, Gold plans 80 percent, and Platinum plans 90 percent. For people under age 30 or those with hardship exemptions, catastrophic plans are also available.  Subsidies are not available to offset the cost of catastrophic plans, however, so only a very small percentage of enrollees select them. All plans are subject to out-of-pocket maximums, which cannot exceed $7,900 for an individual or $15,800 for a family as of 2019. Plans can have lower maximum out-of-pocket limits, but no ACA-compliant plan can be sold with higher out-of-pocket limits (grandfathered and grandmothered plans that are still in force can have higher out-of-pocket limits, but those plans can no longer be purchased by new enrollees). The Marketplace Health Insurance plans for Florida residents can be compared on the website.

ACA/Marketplace (Obamacare)

​When you’re deciding where to shop for coverage, it’s important to figure out if you qualify for a premium subsidy or cost-sharing reduction subsidy based on your household income. If you do, you’ll probably want to get your health insurance through the marketplace, because that’s the only way the subsidies are available. These cheap health insurance options do require specific income and other qualifications. If you take medications or see specific medical providers, you’ll want to also check the formularies and provider networks of the available plans, and it’s possible that an off-exchange option might work better for your situation. But if you’re eligible for subsidies and you select an off-exchange plan, you’ll be giving up that financial assistance.  Cost-sharing subsidies are only available on Obamacare Silver plans in the marketplace.

​Premium subsidies for eligible applicants can be applied to any of the “metal” plans in the Obamacare Marketplace. Cost-sharing reduction subsidies are available to applicants with a household income between 100 percent and 250 percent of the federal poverty level (the lower threshold is 139 percent in states that have expanded Medicaid; below that, Medicaid is available instead).  Premium subsidies are available to applicants with a household income between 100 percent and 400 percent of the federal poverty level (the lower threshold is 139 percent in states that have expanded Medicaid; below that, Medicaid is available instead).