Types of Insurance:
- ACA Health Insurance
- Short Term Coverage (outside open enrollment)
- Dental – Vision
- Accident Coverage
- Critical Illness
- Life Insurance (Term and Indexed Universal)
Let me break down primary health insurance coverage types:
ACA health insurance is the same as “on exchange” or “off exchange” and some refer to it as “Obamacare”. This is the federally mandated coverage the government feels that you need. (I am not a lawyer and my take on whether or not I agree about this is NOT important. This summary is intended to put understanding in your hands so you are educated and can avoid getting ripped off or mislead and can make a good decision for you and your family.)
There are some important distinctions between “on exchange” and “off exchange”.
On exchange means you are applying for health care and asking the government to help pay the bill. In other words, it means to get a subsidy from the government to help pay for your monthly premium or get a return on your taxes.
Off exchange is the SAME insurance as on the exchange but you pay ALL the cost. Therefore you do not have to go through the government’s www.healthcare.gov website.
When you go through the government site, a number of agencies in the government will go through all your information to verify what you told them is accurate, and if they cannot verify through their many channels, you will have to provide them proof of identity, income, citizenship and other things.
Open enrollment is a time allotted for getting enrolled in a health care plan. Generally, open enrollment is November 1 through January 31st but these dates are subject to change.
Short Term Coverage is an insurance like the insurance was before ACA and Obamacare. Short Term coverage is underwritten, meaning you have to qualify (it does not take pre-existing conditions.) For example, I cannot qualify for short term insurance because I am in a wheelchair. Because these plans do not accept pre-existing conditions, and are not full of other types of coverage that you may not need, they are usually less costly per month. However, it is important to understand that because these plans DO NOT meet the government requirements, YOU STILL MAY BE TAXED the following year. You will have to make the decision whether it is worth it to you. That does not mean it is inferior coverage, not at all. It just does not make you pay for coverage you do not need, and they are not paying for a problem that you may already have, therefore it is less expensive. That is as simple as I can make it.
Why should you go with the short term instead of ACA plan? Example: ACA plan premium is $800.00/month and a short term plan may be $250.00/month and the cost of the tax at the end of the year may be $1200.00. To break that down 1200 divided by 12 equals $100.00 your total cost for short term insurance is $350.00 per month instead of $800.00. This is for your education to make a decision.
You can also real about supplemental insurance coverages.