I don’t want an Obamacare plan: What are my alternatives?
Don’t want Obamacare? You have other health insurance options — but experts say you should know the pros and cons of all of your choices before buying a plan.
The first question you should ask is why you want to go an alternative route for your health insurance.
“I’ve had clients who don’t like the idea of Obamacare but don’t fully understand it,” says health insurance agent Tim Hebert, co-founder of Sage Benefit Advisors in Colorado and a certified health care reform consultant.
5 alternatives to Obamacare
If you know you won’t qualify for a subsidy — designed to offset the cost of plans in the insurance marketplaces — or you prefer to pay full price, it can be faster and easier to shop outside the marketplaces, he adds. For example, one of Hebert’s clients recently enrolled in a plan directly with an insurer in about 15 minutes. In contrast, all Colorado consumers who shop the state’s exchange, Connect for Health Colorado, have to fill out a 27-page Medicaid application in order to see if they can get a subsidy, he says.
If you’ve made up your mind that you don’t want Obamacare, here are five other options for finding health insurance coverage.
1. Go to a broker or agent to buy an individual plan outside the marketplaces.
A broker or agent can recommend insurers and help you navigate plan options, explaining the pluses and minuses of each plan. “We have a wide range of products and rates — from plans that cover catastrophic events to those that cover every little thing,” says Phyllis Martinsen, an Idaho licensed insurance agent with Erstad & Company who has gone through training and certification on the Affordable Care Act (ACA). A broker or agent can help you delve into the details of the plan. For example, some plans have separate deductibles for prescription drugs, she says.
A broker or agent also can help you check out the health care provider network for each plan, so you don’t sign up and then find none of the doctors or hospitals you want to use are in-network. “It doesn’t cost you anything to talk to somebody who knows what they’re doing so you don’t make a mistake,” Hebert says.
2. Buy a plan through a professional association or other organization.
You can still buy health insurance through groups such as trade associations, the AARP or the Alliance for Affordable Services, a group geared toward helping members save money. But Hebert says this might not be the best route to go. “Watch out — some groups have contracts with certain carriers,” he says, adding that consumers might be steered toward insurers that are paying the groups to sell their plans. In that case, you’d have a limited selection of plans to choose from and a lower chance of finding the best one for you, he says.
3. Buy health insurance online. It’s also possible to shop online on your own, Hebert says.
If you decide to shop this way, read through all the details of any plan you’re considering. “Don’t just look at the highlights,” Martinsen says.
4. Get on a family member’s plan
If your spouse or domestic partner has health insurance through work — or if you’re younger than 26 and can get on a parent’s plan — you might consider going this route, experts say.
Consumers considering this option should crunch the numbers, comparing the cost of the employer-sponsored plan to purchasing individual insurance, Hebert says. Because employers typically pay more toward employee coverage, it can be expensive to add a spouse or child to a plan, Hebert says.
“It might make more sense to go out on your own,” he says.
5. Don’t buy health insurance.
And, finally, Martinsen says she has had some clients say they will go without health insurance and pay the penalty. She warns consumers to think hard before going that route: “If something catastrophic happens with your health, you could be out a lot of money.”
Things to consider if you opt out of Obamacare
One fact you should know: You can’t get a subsidy to help pay your premiums unless you shop through the health insurance marketplaces created by the ACA, Hebert says.
Depending on your income and family size, you might save big if you shop through the ACA marketplace in your state, Hebert says. In 2013, a consumer in a family of four with a household income of $23,550 to $94,200 could qualify for subsidy. The less you make, the higher your subsidy.
For example, a consumer who makes $25,000 a year and has three kids should definitely consider shopping in the marketplaces. “Some people are really excited to realize they can get subsidies,” Hebert says.
If you’re worried about encountering glitches on HealthCare.gov or your state’s marketplace, you can enroll using a paper form, Martinsen says.
If you do decide to shop outside the marketplaces, you should ask at least three questions about any plan you’re considering, Hebert says.
1. Is the plan ACA-compliant?
You want to make sure the plan you’re purchasing meets the minimum requirements of the ACA — both to make sure you have good coverage and to avoid fines, Hebert says. If you buy a plan from an approved insurance company — you can find a list on your state department of insurance website — it should meet ACA requirements, Martinsen says.
2. Is there a lifetime limit on the plan?
The ACA bans lifetime limits for essential health benefits such as hospitalization, emergency services and prescription drugs, but plans can place lifetime limits on other benefits.
3. Is wellness care covered at 100 percent, with no cost-sharing?
The ACA requires all plans sold inside and outside the marketplaces to provide free preventive care) from in-network providers. However, some insurers are selling supplemental plans, such as hospitalization insurance or cancer insurance, and advertising them “as if they were ACA plans, only cheaper,” Hebert says. So, he says, it’s important to buy a plan that offers the coverage you need.