Many middle-class Americans are able to delay purchasing one of Obamacare’s Essential Benefit Plans for as much as a year. This strategy is dependent on a good understanding of the final Health and Human Services rules for enrollment.
In order to avoid a system over-load of the new health insurance marketplace, Americans who already have qualifying health insurance are able to delay, without paying a “penalty,” enrollment in one of Obamacare’s Essential Benefit Plans until your policy renews in 2014.
Most group health insurance plans will use the policy anniversary date as the renewal date. Those plans will automatically change to one of the Essential Benefit Plans as they renew throughout the year.
However, if you have an individual health insurance policy, your insurance company may have adjusted the renewal date of the policy to December 31, 2014 with your state.
Not all insurance companies made this adjustment. If you elect to use this strategy, you will need to verify with your health insurance company that they did adjust your renewal date.
To verify if your insurance company did make arrangements with your state for the appropriate adjustment, call the customer service number that is on your health insurance I.D. card.
If this option is available to you, I recommend that you take advantage of it for two reasons.
HEALTH EXCHANGE COMPUTER PROBLEMS
I recently read, “Glitches Expected In Health Exchange Websites.” In the article, the Wall Street Journal quotes several of the computer technicians who predict that there will be problems with the new health insurance marketplace computer system.
By delaying your enrollment, you will give the computer experts with the Department of Health and Human Services another year to identify and correct any computer bugs and glitches that might appear as a result of the “rush-job” behind the Federally Facilitated Exchanges.
It is likely that the Individual health insurance plan you have now has limited benefits for maternity and substance abuse. If that is the case, the premium for your current policy should be substantially less than the premium for a similar Essential Benefit Plan.
My advice is that you compare your current policy to one of the new options in October. If the new Essential Benefit Plans do a better job of meeting your insurance needs, you should be able to get one of the new plans, that will be effective in January, 2014.
You should be able to enroll either through the new health insurance marketplace or with a certified health insurance agent.
However, if you do not need maternity or substance abuse coverage and are comfortable with your current health insurance, you do not need to do anything until October of 2014.
I know that the premiums for current plans are expensive but the predictions are that rates will increase significantly for the new Essential Benefit Plans. The latest predictions I have seen are for a national average increase of 30%. The biggest decrease I have heard of is 13%. The largest premium increase that I have seen is 80%.
The only way for you to know if this strategy makes good sense for you is to compare your current plan with those Essential Benefit Plans that are offered in the online marketplaces in October. By that time, all the political spin over premiums will be over. You will be able to make an informed decision based on facts and not predictions.
A caveat is a warning. I want to emphasize two warnings for people who may be inclined to use this strategy.
- This strategy is only available for a limited time. If it is something you want to do, you must have a qualifying health insurance plan with an effective date in 2013 or before.
- This strategy is not for everyone. If you are a female in her “child-bearing” years or anticipate that you will need insurance help with substance abuse in 2014, you would be better off with one of the new Essential Benefit Plans through either the new Federally Facilitated Marketplace or a certified insurance broker outside of the Marketplace.