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As major insurance companies pull out of Obamacare markets and healthcare premiums continue to soar, more and more Americans have asked how to secure decent healthcare coverage without breaking the bank.
A growing number of people are happy with non-traditional health insurance alternatives.
Consider these six non-Marketplace choices if you can’t afford to buy health insurance on Obamacare-only exchanges. These plan types may also meet your needs if none of the on-exchange plans have what you’re looking for in a health plan. While these coverage options are by no means perfect, they are a lot cheaper than most major medical policies.
1. Private, Off-Marketplace Plans
Off-Marketplace plans are close to a mirror image of what’s offered on the government insurance marketplace. However, since these plans aren’t listed on the government marketplace, they don’t have to offer lower monthly premiums to certain members. This leads to lower costs for those who do choose the plan
What’s Covered: Essential benefits; some plans may include out-of-network coverage and/or coverage for a wider selection of prescription drugs.
Cost: Private plans tend to be less expensive than Marketplace plans.
Who’s Eligible: Most people.
Best-Suited For: People who want a traditional Obamacare plan, but make too much money to qualify for subsidies.
Regardless of whether you shop on-Marketplace or off-Marketplace, the ACA’s regulations and consumer protections apply to all plans in the individual and small group market. Some health insurance companies only offer off-Marketplace plans.
While premium and deductible costs can be higher in off-Marketplace plans, insurance policies sold outside of the Obamacare exchange are more likely to offer out-of-network coverage and other benefits of value to consumers.
If you’re eligible for premium subsidies, a Marketplace healthcare plan will almost always be the most affordable coverage choice. However, if you make too much money to qualify for subsidies, but do not earn enough income to afford high premium costs, Marketplace health insurance alternatives may provide consumers with access to additional plans and insurance carriers not offered on the government exchanges. Some people opt to shop outside the exchange if they know they won’t qualify for subsidies and want to have access to more plan options.
In some cases, off-Marketplace plans may offer coverage for a wider range of prescription drugs than Marketplace healthcare plans do. If you take a particular brand-name medication, you may be better off with an off-exchange plan that includes those drugs in their formulary, instead of a Marketplace healthcare plan which only provides coverage for a similar medication, or the generic version. purchased directly from a health insurance carrier, through a private exchange, or with the help of an insurance broker. The same enrollment windows apply no matter where you purchase coverage.
2. Temporary Health Insurance: Short-Term Health Insurance
What’s Covered: Benefits for unexpected illnesses and injuries. (Preventative care, maternity care, and prescription drugs are NOT covered).
Cost: Cheaper than Marketplace healthcare plans and most traditional medical plans.
Who’s Eligible: People in good health (providers reserve the right to deny coverage to those who have pre-existing conditions or high medical costs).
Best-Suited For: People who are in-between major medical insurance plans and need a temporary solution.
Short-term health insurance plans (also referred to as “short-term medical plans”) are designed to provide a temporary safety net for people experiencing an unexpected gap in healthcare coverage.
Like their name implies, short-term health plans function as temporary health insurance for people who are in-between major medical insurance plans, maybe because of a sudden job loss or due to aging out of a parent’s plan.
Short-term health plans don’t provide as much coverage as a Marketplace healthcare plan, but they are much cheaper and can serve as a temporary solution for people until they get more comprehensive coverage.
Depending on where you live and how healthy you are, short-term health coverage can last up to 364 days (with the possibility of multiple extensions) and has a lower monthly premium cost than regular insurance coverage does. Planholders can choose when their period of coverage ends and usually have the option to re-enroll or renew their policy. Short-term plans offer limited coverage for a limited period of time; they are not supposed to be a long-term solution. That said, short-term health plans provide basic coverage in a pinch–and will protect you from tallying up a huge medical bill if you get injured or ill in the interim.
Because most short-term policies are not ACA-compliant, they can discriminate against people with pre-existing conditions and rarely offer benefits like maternity care or prescription drug coverage. That means someone with diabetes isn’t likely to get coverage, and short-term plans tend not to offer free screenings and other essential benefits plans which marketplace plans are mandated to cover under the ACA.
3. Primary Care Membership (“Concierge Medicine”)
What’s Covered: Routine healthcare services and exams.
Cost: Cheaper than traditional plans, with more predictable out-of-pocket costs.
Who’s Eligible: Anyone.
Best-Suited For: Healthy individuals who can’t afford Obamacare premiums and are seeking an alternative way to receive routine, preventative care.
Concierge medicine is primary care offered directly to consumers and employers without third-party insurance administration. In practices operating on a concierge membership model, patients pay a monthly or annual retainer–typically between $60 and $100 per month–to their doctor or medical office for a contracted bundle of services.
Membership medicine is also referred to as “direct primary care (DPC),” “direct-pay medicine,” and “membership medicine,” and the medical services offered tend to be standardized within a practice and are not individually negotiated. It’s a simplified model of healthcare which enables doctors to provide care without having to deal with insurance companies. It serves as both an affordable solution for people who can’t afford to pay Marketplace healthcare premiums and as an alternative practice model for doctors who want to spend less time on paperwork and more time with patients.
Most membership practices provide routine healthcare services and exams, but surgeries and more complex procedures may not be included. Patients may still need insurance for catastrophic occurrences such as a heart attack, accidents, or contracting a disease. On the plus side, however, these practices offer personalized care, streamlined billing, and priority scheduling to patients.
4. Health-Sharing Plans
What’s Covered: Medical care that is consistent with Biblical teachings (prenatal care for out-of-wedlock pregnancies, alcohol and drug addiction treatments, sterilization procedures, etc. are not covered).
Cost: Usually cheaper than traditional plans, but health-sharing costs and annual sharing responsibilities differ by plan.
Who’s Eligible: All health-sharing ministries have different philosophies and religious affiliations. Read the statements of faith for each ministry to find out which plan lines up best with your personal beliefs.
Best-Suited For: People seeking a community-based approach to meet their medical needs.
The unstable ACA insurance market, particularly in certain states, have provided incentives to consumers seeking alternatives to traditional health insurance. And as health insurance premiums continue to skyrocket, a growing number of Americans are turning to health-sharing plans or faith-based healthcare to meet their medical costs. A faith-based health plan, also known as a health-sharing ministry, isn’t actually a type of health insurance policy; rather, it’s an alternative to health insurance. In these plans, members share the cost of their medical bills with other like-minded individuals in the organization.
Health-sharing plans are much less expensive than individual health insurance plans. Additionally, they don’t limit choice when it comes to selecting treatment options or medical providers. As a result, health-sharing plans offer consumers flexibility and freedom that health insurance plans cannot provide.
Because these Christian healthcare ministries were grandfathered into the ACA as an exception to the Obamacare mandate, the ministries can choose whether or not to cover any essential health benefits (such as preventative care, mental health treatment, and care for pre-existing conditions).
5. High-Deductible Health Plans (HDHPs) + Health Savings Accounts (HSAs)
What’s Covered: Preventive care and essential health benefits.
Cost: Inexpensive monthly premiums; higher out-of-pocket expenses due to higher deductible.
Who’s Eligible: Anyone.
Best-Suited For: People who rarely get sick and want control over how to spend and invest their money.
High-deductible health plans (HDHPs) can be an appealing choice for consumers looking to lower their monthly expenses. Like their name implies, individuals covered by high-deductible health plans pay a smaller premium amount each month, but they must also pay thousands of dollars out-of-pocket before insurance begins to cover the cost of their medical expenses.
With HDHP coverage, medical care and services (including most prescription drug costs) require you to pay out-of-pocket until you’ve met your deductible. For example, if your high-deductible health plan has a deductible of $8,000 and you find yourself with a $14,000 hospital bill, you must pay the $8,000 out-of-pocket before your insurance kicks in and helps you cover the rest of your bill. Preventive care services are a notable exception to deductible fulfillment, as HDHPs – like all plans under the ACA – are required to cover the cost of in-network preventive care, such as annual checkups, well-woman exams, and mammograms.
Some HDHPs are compatible with health savings accounts (HSAs). HSAs allow those enrolled in high-deductible plans to use pre-tax dollars to pay for their medical and healthcare expenses and can also help policyholders save money on a long-term basis.
As an alternative to more traditional Obamacare plans, HDHPs are best-suited for people who are relatively healthy and rarely get sick or go to the doctor. Many routine health services intended to keep you well (e.g. colonoscopies, mammograms, and vaccinations) are covered at 100 percent by HDHPs; as an HDHP policyholder, you should understand your coverage, so you know what’s free. However, for those who manage chronic conditions or live on lower incomes, HDHPs are not a practical choice. HDHP coverage can also be problematic if you have an emergency, or incur unanticipated medical costs.
If you’re considering HDHP coverage, the most important thing to remember is: every decision you make about your medical care counts. HDHPs require consumers to take ownership and initiative over their own care. In other words, it’s crucial for consumers to know what is and isn’t covered by their plan.
6. Catastrophic Health Insurance
What’s Covered: Preventive care and essential health benefits.
Cost: Inexpensive monthly premiums, but policyholders must pay for all their healthcare costs out-of-pocket until they meet their plan deductible.
Who’s Eligible: People under age 30 and/or those who have a hardship or affordability exemption from the ACA’s individual mandate penalty.
Best-Suited For: People who don’t need comprehensive coverage, but want a modicum of financial protection.
In the past, “catastrophic health insurance” was a term that could refer to any kind of health plan with a really high deductible. Since the passage of the Affordable Care Act, the term refers to a category of individual and family health insurance plans that are sold on the state and federal health insurance exchanges.
Only certain people are eligible to buy catastrophic health insurance sold on the Affordable Care Act’s insurance exchanges. To qualify for this type of coverage, policyholders must be under the age of 30, or have a hardship or affordability exemption from the ACA’s individual mandate penalty. Also, if you’re eligible for a health insurance subsidy to help you pay your monthly health insurance premiums, you can’t use that subsidy toward the cost of a catastrophic healthcare plan.
Catastrophic plans are designed to protect individuals in a worst-case scenario or medical emergency. Monthly plan premiums do tend to be lower than those of traditional plans, but policyholders generally need to pay for all their healthcare costs out-of-pocket until they meet their plan’s deductible. All things considered, catastrophic coverage is a limited type of policy for adults under the age of 30. It covers catastrophic events, and it also counts as ACA-compliant insurance.
Taking the Next Steps
Depending on different factors – how long you want to be covered, or how much coverage you want – there are numerous Obamacare alternatives that you can take advantage of.
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