What You Need to Know About the Affordable Care Act: Money-Saving Tips from An Expert

If you donít have health insurance, thereís still time to purchase a plan through HealthCare.govóthe official website of the governmentís healthcare marketplace, also known as the exchange. Established by the Affordable Care Act (ACA), the healthcare marketplace will allow you to compare the private insurance options available in your state, and purchase insurance.

But youíll need to act fast since the enrollment window closes on February 15. To assist you in buying the plan for your needs, QualityHealth spoke to healthcare advocate Michelle Katz, MSN, LPN, author of Healthcare Made Easy: Answers to All Your Healthcare Questions Under the Affordable Care Act (Adams Media, 2014).

"The ACA can seem like a big, overwhelming mass of confusing jargon and complicated requirements," says Katz. "But if you take it a step at a time, it is possible to get your questions answered and start getting the medical care you need."

Step 1: Understand the Basics

If you already have insurance offered through your employer, or a public plan like Medicare (for people over 65) or Medicaid, you wonít need to purchase any additional coverage through the exchange. But if you donít have insuranceóand you elect to forego coverageóyou may be faced with a penalty.

According to the IRS, health insurance coverage will now be reported on tax returns. If the IRS deems that you donít have qualifying coverage, you will be taxed. Conversely, tax breaks will be offered as incentives to those who purchase health insurance through the marketplace.

"Thereís a lot of concern about the tax penalty, but the truth is it doesnít appear that the IRS currently has the resources to collect the penalties," says Katz, adding that this may change down the line. For more information about the tax-related provisions of the healthcare law, go to The Individual Shared Responsibility PaymentóAn Overview.

Step 2: Know Your Health Care Needs Before You Visit The Marketplace

To make the right choice, itís important to consider your particular situation and spend time thinking about medical costs you are likely to incur in the coming months. Obviously, if youíre young, healthy and single, your needsóand your choicesówill be different from those of someone who is older, or has a family or a chronic condition that needs special care.

"Try to come up with a few things you canít live without, such as being able to see your favorite doctor in network," Katz advises. After all, "The cheapest plan is probably the most expensive if you learn that your doctors, particular treatments or meds arenít covered. Itís a mistake to pick a plan based on price alone."

Here are some other questions to contemplate as your consider your options:

  • How many times per year do you get sick, on average?
  • Are you concerned with getting regular checkups and preventive care benefits?
  • What type of plan is best suited to your needs? Is it a health maintenance organization (HMO), which can restrict your choice of providers and facilities but gives you broad coverage and convenience? Or is it another option, such as a preferred provider organization (PPO), which charges you less for using in-network providers but allows access to out-of-network services for an additional cost?
  • What is your medical history? If you have a condition like cancer, heart disease, or diabetes, find out if the plan youíre considering provides coverage for problems related to these diseases.

Step 3: Compare Plans

With this information in mind, itís time to go to the marketplace. (If your state has its own exchange, you will be directed there.) According to HealthCare.gov, there are 25 percent more health insurers competing in the marketplace now, and eight of out 10 people can find coverage for $100 or less a month with tax credits.

Qualified health plans must offer a core set of items and services, also known as essential health benefits, which include coverage for:

  • Behavioral health services.
  • Chronic disease management.
  • Emergency services.
  • Hospitalization.
  • Maternity and newborn care.
  • Pediatric services, including oral and vision care.
  • Prescription drugs.
  • Preventive/wellness services.
  • Rehabilitative and habilitative services (these are "Health care services that help you keep, learn, or improve skills and functioning for daily living," according to HealthCare.gov.)

Read the benefits summary for each plan. Then evaluate the planís coverage and features, taking into account the:

  • Cost of the premium (the amount youíll be charged for the plan).
  • Exclusions (what isnít covered).
  • Limitations (for example, you might be allowed a limited umber of appointments with a specialist annually, or you might be covered for just a certain number of days in the hospital per year).
  • The ability to choose healthcare providers.

Find out how much youíll pay out of pocket in the form of copayments (a fixed amount for a particular service, such as $40 to visit your primary care physician), coinsurance (your share of the cost of the service, usually calculated as a percentage), and deductibles (the amount you must pay before benefits kick in), since these charges can add up if you see providers frequently.

Basically, the public marketplace offers four types of plans with different levels of insurance coverage. Generally, you will be choosing between a plan that may cost less up front but offers narrower coverage, meaning your out-of-pocket costs will be higher if you need more services, and a plan that charges higher premiums but provides wider coverage. Nonetheless the health plans must include the core set of items and services listed above.

For example, a reasonably priced plan that costs $200 a month may only offer patients one hospital in which services will be covered or a limited choice of specialists, whereas a more expensive plan may have more hospitals specialists to choose from and may even cover services like chiropractic care.

  • Bronze is the least expensive option. It covers about 60 percent of your medical expenses. You may have the lowest monthly premiums of the four plans, but the highest out-of-pocket costs.
  • Silver covers about 70 percent of your medical expenses. The remaining 30 percent will be out-of-pocket costs to you. Premiums are higher than the Bronze plan, but the cost to you in terms of expense is generally lower. This plan has the second lowest monthly premium (not including federal subsidies) and the deductible is about $2,000 annually. Additionally, this is the only plan that offers cost-sharing subsidies.

Note on cost-sharing subsidies: If you feel purchasing subsidies is prohibitively expensive, the federal government provides some subsidies to help lower-income individuals afford coverage. Whether you qualify for you a subsidy depends on several factors. The three primary ones are:

  • Your household income.
  • The number of dependents you have.
  • The part of the country you live in.

To see if you qualify, Katz recommends a helpful subsidy calculator. Visit The Henry J. Kaiser Family Foundationís Health insurance Marketplace Calculator.

  • Gold pays 80 percent of your medical costs. It has the second-highest premiums of the plans.
  • Platinum is the most expensive plan in terms of premiums. It will cover 90 percent of healthcare costs, and youíll pay the other 10 percent.

Other points to consider: What type of preauthorization (advance approval for a service from the insurance company) is required for different services? Are there discounts or incentives for good health or healthy behaviors such as being a non-smoker?

Keep in mind that the precise costs will vary from company to company and state to state. "Rules are different in every state, so you need to look at your state like itís a separate country," says Katz, who also recommends visiting the National Association of Insurance Commissioners Map of NAIC States & Jurisdictions, where you can be linked to your stateís insurance commissionerís website and learn more about insurance-related issues that may affect you. "Sometimes youíll discover new rules and new plans coming out in your area and find some valuable shopping tips. Itís also a place where you can view insurance-company complaint records."

While there you can also check out the rules regarding the free look period in your state: "Most people arenít aware that thereís a period of timeóat least 10 days but sometime up to 60 daysówhen you can basically return the policy and get a refund if you arenít satisfied with it." Unfortunately, if you miss the free-look period window youíll have to wait until next open enrollment period, which is usually in the fall.

Finally, donít assume anything until you thoroughly read your benefits packet. Itís a good idea to find out if lab work, certain routine tests you are accustomed to receiving and x-rays, for example, are covered, or if youíll be paying for those. "I canít tell you how many times people get slapped with fees they werenít expecting because they didnít realize their doctor was covered but the facility where they were treated was not," says Katz. Today, more than ever, itís important to take the time to read and understand your plan. "If you donít, I can promise you, you will pay more than you should."

Step 4: Follow These Cost-Saving Tips

In addition, these guidelines should help you save money on healthcare:

  1. Be your own advocate. According to Katz, looking out for yourself, asking questions, and scrutinizing bills are the best ways to save money. Because the industry is evolving and the new rules and regulations are still being implemented, thereís a lot of confusion. "To date, there have been over 42 changes to the law. Itís tough to keep up," Katz explains.
  2. Know you can refuse tests. "Many tests are offered because doctors are worried about getting suedóand the patient ends up having to pay for them," Katz explains. "Ask why you are being offered certain tests and if they seem unnecessary, you have the right to say no."
  3. Ask for a copy of an itemized bill along with your medical records before leaving the hospital or other care facility. If they arenít ready by the time you are discharged, find out whom to contact and when you can expect the documents to be ready for pick up. "I also advise people to pick up records in person. It may save time, plus it prevents important documents from being lost in the mail," Katz says.
  4. Scrutinize bills when you receive them. Katz advises patients to carefully compare any doctorsí and insurance company bills you receive to your own records and itemized bills. "Itís not unusual to find discrepancies. Wrong dates, wrong procedures, wrong doctorsóeven wrong patients," says the expert. "One mistake can mean thousands of dollars, and any incorrect submission to your insurance company can leave you responsible for the entire bill."
  5. Ask questions. Expect a bill from anyone who has input on your medical care. "Remember, everyone who touches you is going to send you a bill, and just because your primary doctor is covered by your insurer, that doesnít guarantee the facility where the procedure was performedóor the specialist who administered your anesthesiaóis covered," she explains.
  6. Keep careful records and donít give up easily. When thereís a billing discrepancy and you need to call your insurance company or the doctorís office for clarification, take notes. "Record who you talked to and when you had the conversation. This will show everyone involved that you are not going to back down easily."
  7. Be wary of hiring a broker. In certain circumstances an insurance broker may be helpful, Katz admits: "If your income is too high to qualify for a subsidy and you still canít afford insurance, a broker might have a solution. But understand that some brokers are biased," since some may have a financial incentive (that is, they receive commissions from companies) to push particular products. "Still, if they work for a variety of insurers and arenít beholden to one insurance company, they may be able to save you time, money, and future headaches.Ē The National Association of Health Underwriters or your stateís insurance commissioner may be able to connect you with a reputable broker.
  8. Save on prescription drugs. If your insurance company doesnít cover a medication you need, Katz recommends GoodRx. "Paying out of pocket for medications can be more affordable than you think," she says. "Itís not unusual to find huge variations in the cost of prescription drugs. Prices can differ tremendously from one pharmacy to another, even those located in the same town. One drug I use cost $500, but I paid just $4 for it (along with a $30 co-pay) with a coupon from the GoodRx website."

Note about forthcoming changes to medication. Many brand-name drugs will be designated generic starting in April. Depending on the insurance planís contract with the pharmaceutical manufacturer, in some cases, the plan may offer the generic drug, which may be especially problematic for patients currently using specific medications used to treat mental health issues. If this will affect you, you should be notified at least 30 days in advance. To find out of you medication is on the list, visit Community Catalystís Drugs Going Generic 2014-2015.

Expect Big Changes Down the Line

Katz admits that the landscape is going to continue evolving and will look significantly different in the near future: "In 2016, federal funding will start decreasing, and by 2017 it will stop completely," Katz explains. "Thatís when premiums will sky rocket. In the meantime, the system may either implode or face some sort of overhaul and it may happen sooner than you think. Republicans currently control both houses of Congress and are planning to change certain aspects of the law, so stay tuned."

And note that as the system continues to evolve, mistakes will be made. "I think itís fair to say that with all the changes going on, human error is at an all-time high," Katz says. Billing is one area in which this is apparent; Katz says that doctors are outsourcing most of their billing now in an effort to be more efficient. "Know that errors have been occurring. Be proactive. Look for them and dispute them. Your time and effort will pay off."

In the meantime, take advantage of the positive aspects of the law. According to Katz, consumers who benefit most are those with pre-existing conditions and young people now covered under their parentís insurance until the age of 26.

"I know someone with a chronic heart condition. Under Obamacare, her premiums went from $2,500 to under $600," says Katz, who adds that thereís also a ban on lifetime limits now. Lifetime limits, a dollar limit on what insurance companies will spend for your covered benefits during the entire time youíre enrolled, mean that enrollees are required to pay the cost of all care exceeding that limit. Katz notes, "In many insurance companies when you hit a certain limitósay three millionóyouíre done. For some health issues, thatís not a high enough threshold. This kind of treatment is illegal under the ACA," since lifetime limits on most benefits are prohibited in any health plan or insurance policy under the ACA.

Michelle Katz approved this article.

Sources

Phone interviews with Michelle Katz, MSN, LN. December 29, 2014, and January 14, 2015.

"Understanding Your Medical Bill." FAIR Health. Accessed 15 January 2015.

"Facts About the Individual Shared Responsibility Provision." IRS.gov. Updated 16 January 2015.

"Last Chance for 2015 Coverage: February 15." HealthCare.gov. Page accessed January 21, 2015.

"Habilitative/Habilitation Services." HealthCare.gov. Page accessed January 19, 2015.