What to Ask Before Renewing Your Health Insurance Coverage

As the Affordable Care Act’s insurance program gears up for its second enrollment period this month, many observers believe the process to be much improved. But that doesn’t excuse people who sign up on a public insurance exchange from doing their homework.

Open enrollment starts Nov. 15. According to the New York Times, Obama administration officials say that it will be easier this time for consumers to purchase health insurance in the public marketplace, and they promised that HealthCare.gov would not crash, as it did last year.

If you want coverage in a new plan by Jan. 1, 2015, you must enroll by Dec. 15. All coverage purchased on a government exchange for 2014 ends Dec. 31 regardless of when you bought it. Open enrollment closes Feb. 15, but if you wait until then to buy a plan, the coverage won’t start until March 1.

No one can predict the future, but the Associated Press (AP) offers a few tips about how to join this club, or renew your membership in it. For people who currently have a state or federal exchange plan, you’re advised to resist the temptation merely to renew coverage automatically without examining your options. Although it’s easy to do online, you might be missing the opportunity to make a better choice, and to avoid unpleasant surprises.

Here’s what you need to find out before clicking the “buy” button.

The plan you have now might not offer the same coverage next year. So automatic renewal doesn’t guarantee that your coverage or premium will be the same. It just ensures that you have insurance for next year.

You’ll get a letter from your insurer outlining your 2015 coverage and detailing the policy’s terms. Look for changes to coverage, and cost. The deductible, the copay and/or the monthly premium might be different.

If you receive a federal government subsidy or tax credit to help cover the premium cost, the subsidy amount will be included in the letter. Plans that are renewed automatically might show this year’s subsidy amount. So if your premium increases, you’ll pay more next year than this year.

Some plans in force this year will be discontinued. If so, sometimes, insurers automatically enroll you in another plan that’s similar to your 2014 coverage.

Network providers might change – the doctor in your network today might not be included next year. Verify with both the doctor and the insurer to find out.

Even if you like what you see when reviewing your current plan, consider your options – there might be new insurers and more choices than you had this year.

Whether or not your subsidy or tax credit changes depends on your income and your insurance market. According to AP, more than 8 in 10 people who are covered by government plans receive subsidies.

If your income changes or you think it will change, you must update your enrollment file during open enrollment. Will you or anyone in your household get a raise next year? Take a second job? Changes in income will affect your subsidy, which is calculated by the modified adjusted gross income you declared on last year’s tax return.

Did you get married, divorced or have a baby? Lose your job? Life-changing events also can change your subsidy level.

Be honest: Government oversight will determine if your subsidy is too much in 2015, and if so, the excess could be deducted from your tax refund or added to what you owe when you file in 2016.

Subsidies are determined by a benchmark plan in your market. A new plan might become the 2015 benchmark, or that plan might have a new price, which changes your subsidy. If you can’t afford a lower subsidy, you’ll have to shop for another plan.

For help making exchange plan decisions, visit the federal government site, Healthcare.gov. You’ll find answers to common questions, information about the application process and links to individual state marketplaces (not all states have their own exchange; if yours doesn’t and you want coverage through the public marketplace, you must find it on Healthcare.gov.).

For information about tax credits, visit the health coverage tax credit page at IRS.gov.

There’s also a calculator for subsidy information.

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