Starting Saturday, Americans who don't have health insurance through an employer, Medicare or Medicaid will be able to sign up for Obamacare coverage next year through the federal website Healthcare.gov or one of the state marketplaces.
This year's enrollment promises to be more confusing than in the past. Congress is divided over allowing additional tax credits that have reduced the cost of coverage to expire this year. The federal government has been closed for more than a month, and the Republican-dominated House and Senate are resisting Democrats' demands to extend increased subsidies as a condition for reopening the government.
Most people now enrolled under the Affordable Care Act are still eligible for some federal tax breaks, but many will see their monthly costs skyrocket without the additional help. Some may no longer be eligible for a grant, and others will receive less support than they did this year.
The resulting price hike and stalemate in Congress will complicate an enrollment process that has been cumbersome for many Americans in the past.
“In a word, chaos is going to happen during this open enrollment,” said Jeff Smedsrud, a longtime insurance agent.
Why you need to shop
It's not just lower subsidies that are decisive for the choice of insurance next year.
The underlying costs of the plans are also increasing significantly. Do not automatically renew your current insurance coverage before looking for alternatives. You may want to consult a licensed broker or check out the resources listed on the marketplace website for help.
If people sign up through Healthcare.gov, which covers 30 states, they have until Dec. 15 to enroll in a plan that begins Jan. 1. The last day to sign up for next year is January 15th, for coverage that would begin February 1st. Some state marketplaces have different deadlines.
“People should really look and see what they're facing and what their options are,” said Justin Giovannelli, a health care researcher at Georgetown University's Center on Health Insurance Reforms. “There is no reason to delay this.” But stay tuned. If Congress passes a subsidy extension, you may adjust your election during the open enrollment period.
Choose another plan
Because of the higher prices, some people may want to choose a cheaper plan that has a higher deductible or out-of-pocket costs.
Marketplace plans are listed in four tiers named after metals. Bronze plans are typically the cheapest and have the highest deductibles. Platinum plans typically offer the highest premiums and lowest cost sharing when you seek medical care. The right choice for you depends on your monthly budget and how much healthcare you expect to need in the coming year.
The tax credits are calculated based on the cost of a Silver plan, a type of insurance that covers about 70 percent of a person's average annual medical bills.
If you have a relatively low income — less than $39,126 for a single person or $80,376 for a family of four — you should definitely consider a silver plan. You are still entitled to assistance to pay your premiums as well as subsidies to reduce deductibles and cost sharing. As you earn more, check out the options at each tier. Due to a regulatory quirk, gold plans may be cheaper than silver plans in some markets.
If you are under 30 and do not qualify for subsidies, you may also consider a category of health insurance called catastrophic insurance. It includes high deductibles and covers fewer services upfront than other options. But it offers good financial protection if you need expensive medical care.
For people who don't qualify for subsidies, premiums for catastrophic plans tend to be slightly cheaper than for plans in the metal tiers. However, if you qualify for a tax credit, you cannot use it to fund a disaster plan.
Beyond comparing prices, you should also check the fine print about the insurance coverage you can get under different plans. Some cover select hospitals, doctors, and medications or offer different deductibles and copays. These are crucial elements to consider if you have special health needs or if you want doctors to continue monitoring your care.
Finding the right plan can take time and effort – another reason not to wait until the last minute.
Update your income
The subsidies, which help many people pay their premiums, are calculated based on income. If your calculation is incorrect, you may have to make up the difference at tax time.
The penalties for a mistake could be harsher than usual next year. Federal law previously limited how much low-income consumers who erred in filing taxes could be asked to repay the state. But a law passed this summer raises those caps, meaning a mistake could be more costly. People earning nearly 400 percent of the federal poverty level — about $63,000 for a single person — could face thousands of dollars in tax penalties if they underestimate their income.
If you're self-employed, it can be difficult to accurately determine your income in advance. However, you can access the marketplace at any time throughout the year and make adjustments as needed.
“People should be busier than ever before,” said Katie Keith, an associate professor of law at Georgetown University who has studied the changes. “They both project it now as they apply it and update it throughout the year.”
Other alternatives
If you chose an Obamacare plan this year because it was cheaper than your employer's plan, you'll want to make sure that's still the case.
But beware of other types of insurance or coverage-like products that are not bound by the rules of the Affordable Care Act. They may not cover an expensive medical procedure or disqualify you because of pre-existing conditions.
These alternatives include short-term health insurance plans and fixed indemnity plans that cover a set amount for treatment costs. Some people choose to get coverage through Christian health sharing groups, which offer to pay their members' medical bills, but the promises don't amount to real insurance.
“A lot of this can be junk reporting that doesn't cover what you need,” said Anthony Wright, executive director of Families USA, a consumer group in Washington, D.C
What happens if Congress extends the expanded tax credits after I enroll?
It's unclear what would happen if Congress decides to extend the expanded tax credits after enrollment is complete. The changes may take some time to come into effect, meaning people will continue to pay the higher premiums for some time.
Mr Wright urged people not to go without insurance cover. Even a few days in the hospital can cost tens of thousands of dollars, he said, and insurance will help protect any financial assets you have, including your home.
“You don’t want to be one emergency away from financial ruin,” he said.