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How to Buy Medical Insurance Through the Marketplace

In 2024, 21.3 million people in the U.S. purchased medical coverage on the federally run Health Insurance Marketplace. Commonly called Obamacare, the Marketplace provides all eligible people a place to buy affordable medical insurance. Additionally, many enrollees qualify for tax credits, lowering their monthly premiums. Read on to learn about coverage options, eligibility requirements, and tips for buying medical insurance through the Marketplace.

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What is the Health Insurance Marketplace?

The Health Insurance Marketplace offers individuals, families, and small businesses a place to shop around, compare, and buy health insurance plans. When your employer does not provide affordable health insurance, or you are unemployed or self-employed, the Marketplace fills a gap, providing people a way to get private medical insurance.

The Marketplace, or Exchange, offers coverage at different tiers, policy types, and costs. You can compare plan types like HMOs, PPOs, EPOs, and POSs from well-known companies such as Blue Cross Blue Shield, United Healthcare, Aetna, and others.

Most states use the Marketplace on Healthcare.gov; however, 19 states currently run their own exchanges. You can find a list of these states and their individualized websites on Healthcare.gov or directly visit a state’s own website.

Who qualifies for Marketplace coverage?

Marketplace coverage is available to most U.S. citizens and legal residents. Additionally, you cannot be denied coverage for pre-existing conditions. However, U.S. territory residents are not eligible for Marketplace plans unless they are also residents of Washington, DC, or one of the 50 states.

To qualify for coverage, you must:

  • Live in the United States
  • Be a U.S. citizen or lawful resident
  • Not be eligible for Medicaid, Medicare, or the Children’s Health Insurance Program (CHIP)
  • Not be incarcerated in jail or prison

Qualifying for premium tax credits

Expensive monthly insurance premiums could cause people to forgo insurance; realizing this, the Marketplace offers people tax credits to help offset costs. Tax credits make health insurance more affordable for many American households.

Tax credits are available only for Marketplace plans and can significantly lower out-of-pocket monthly payments called premiums. Premium tax credits are awarded on a sliding scale based on household income and can change from year to year.

However, tax credits may not be available for people considering opting out of employer-sponsored medical coverage. Most employer-based plans meet requirements for minimum standards and affordability and, as such, are not eligible for savings. Your employer will not contribute to monthly premiums for Marketplace plans, and although your income may otherwise qualify for tax credits, you may not be eligible for savings.

Qualifying for special enrollment

Marketplace open enrollment runs from November 1st through January 15th yearly. However, certain life events allow people to enroll in a Marketplace plan outside of the open enrollment period.

Special qualifying life events include:

  • Relocating or moving
  • Job loss
  • Marriage or divorce
  • Birth of a child or adoption
  • Becoming a U.S. citizen
  • Death of a family member resulting in a loss of coverage
  • Released from incarceration

Special enrollment periods may require enrollment within a specific timeframe, and documentation supporting your eligibility for special circumstances may be required.

Steps to buying medical insurance through the Marketplace

Follow this step-by-step guide to buy medical insurance through the Marketplace.

1. Create an account

Locating your state’s Marketplace is the first step to purchasing medical insurance. To do so, visit Healthcare.gov and create an account by entering basic information like your name, address, and email. If your state uses a different website, Healthcare.gov will redirect you to the correct site.

2. Prepare to apply

During the application process, collect information about all the people in your household and anyone you claim as a dependent on your taxes, even if they are not getting insurance. Financial information is used to determine the tax credit by estimating your income. In addition to having dates of birth and social security numbers for each household member, you may need to submit copies of the following documents:

  • Tax information
  • W-2
  • Proof of wages, salaries, and tips
  • Employer name and contact information (if applicable)
  • Additional income like retirement savings and investments
  • Income from rental properties
  • Immigration documents

You can apply on Healthcare.gov or by calling the Marketplace Call Center at 1-800-318-2596. TTY users can call 1-855-889-4325. Visit Healthcare.gov for more information on ways to apply.

3. Submit your application and explore plan options

Once you have completed and submitted the application, the Marketplace will immediately notify you regarding any tax credits and provide a list of plans with premiums that reflect a discounted rate. Review and compare the plans to find the right one that meets your needs.

4. Enroll in a health plan

Once you have decided on the right plan, it’s time to enroll and pay the premium. Coverage won’t start until the first premium is paid directly to the insurance company. Some insurance companies accept payment via Marketplace accounts, while others may provide additional payment instructions.

Tips for choosing a Marketplace health plan

Before buying medical insurance on the Marketplace, you should understand what plans cover and how to compare different types of plans.

Know what Marketplace plans cover

Regardless of the plan type, all Marketplace plans must include coverage for 10 essential health benefits. Expect all plans to have coverage for the following:

  • Outpatient care
  • Hospital admissions
  • Mental health, behavioral health, and substance use disorders
  • Pregnancy, maternity, and newborn care
  • Prescriptions
  • Labwork
  • Preventive services
  • Pediatric services also include dental and vision coverage

Some plans may include dental and vision coverage for adults, but it is not part of the essential benefits and may require purchasing separate coverage.

Compare the main features of each plan

Learning about plan features and specific differences can help narrow down your decision.

  • Premiums. Typically paid monthly, premiums are the base cost of maintaining a health insurance policy. You will need to pay the premium every month whether you seek medical care or not. Paying premiums on time ensures your policy remains active.
  • Types of plans. The Marketplace offers HMO, PPO, POS, and EPO plans. The type of plan affects your ability to visit network doctors and facilities. Some plans give you more freedom, while others are more strict, limiting or charging more fees for going out of network.
  • Metal categories. Marketplace plans are arranged in tiers: Bronze, Silver, Gold, and Platinum. Categories indicate how much you will pay in cost-sharing with the insurance company. For example, at the Bronze level, you may pay 40% of costs while insurance covers 60%. Financial responsibility decreases at higher levels, so by purchasing a Platinum plan, your portion could be about 10%. Bronze plans have the lowest upfront premiums but also the highest costs when you need medical care. Choosing a category should be made carefully. For more information, visit Healthcare.gov.
  • Catastrophic plans. With low premiums and very high deductibles, catastrophic plans are available to people under 30 years old and for people over age 30 experiencing hardships. People choose these plans in the event of serious injury or illness while paying most other medical bills themselves.

Consider your individual and family needs

Choosing the right plan can depend on your circumstances and may change over time. When budgeting, consider the yearly cost of premiums and add that to your estimated out-of-pocket costs.

Consider network options as well. Will the plan allow you to continue care with your current healthcare team, or do you need to change to another network? Do you or your family members have existing health conditions, or are you mainly healthy?

People on regular prescription medications should research plans for drug benefits and potential costs. Dental and vision coverage is included in some plans but could be an added separate expense.

Carefully considering policy details can aid in making the right choice.

Renewing your Marketplace coverage

Open enrollment dates are November 1st through January 15th annually. Once open enrollment is over, you must wait until next year’s open enrollment period to renew, change, or purchase a plan on the Marketplace unless you experience a special qualifying event.

To renew your existing Marketplace coverage, act before December 15th to ensure coverage starts on January 1st, or renew by January 15th for coverage starting February 1st.

Not all plans automatically renew; if you miss the deadlines, you may risk losing valuable tax credits, coverage, or the opportunity to choose a different plan. Leading up to open enrollment, you should get two letters, one from the Marketplace and another from your insurance company. The letters provide important information about your current policy, possible coverage changes, and how to submit supporting documents if required.

The Health Insurance Marketplace offers millions of people living in the U.S. an affordable path to health coverage. Plans must meet certain standards of care and provide minimum coverage expectations set by the Affordable Care Act. Many policies exceed these expectations. Furthermore, compliance with the ACA guarantees certain consumer rights with your health coverage. Visit your state’s Marketplace website or an insurance broker for more information on enrolling.


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