Plan benefits on and off the exchanges
A big question for many people is whether benefits vary between exchange-based and private marketplace plans. At their core, they do not.
No matter where they are sold, health insurance plans must adhere to certain Affordable Care Act standards to be considered minimum essential coverage fulfilling the individual mandate. At the very least, all on- and off-exchange health plans must include the 10 essential health benefits.
The EHB categories are as follows:1
- Ambulatory patient services—outpatient care without being admitted to a hospital
- Emergency Services
- Maternity and newborn care
- Mental health and substance use disorder services, including behavioral treatment, counseling and psychotherapy
- Prescription drugs
- Rehabilitative and habilitative services and devices—services and devices to help people with injuries, disabilities, or chronic conditions gain or recover mental and physical skills
- Laboratory services
- Preventive and wellness services and chronic disease management
- Pediatric services—including dental and vision care
The benefits in each category may vary from state to state and even slightly from plan to plan. When preparing for 2014 open enrollment, each state selected a benchmark health insurance plan upon which all other qualified health plans in the state were modeled. Plans must offer the same basic benefits but are not prohibited from including additional benefits.
On- and off-exchange health insurance plans must be categorized by metal level—bronze, silver, gold, platinum and catastrophic. As explained above, all of these plans have the same minimum coverage. The two main ways a plan may vary are through 1) name and design and 2) network.
Name and design
The specific health insurance plan designs offered on and off the state-based and federally facilitated exchanges may vary. This means the same carrier may offer a bronze plan under one name and plan design in the private marketplace and another bronze plan with a different name and plan design on the state’s Obamacare exchange. One may be a PPO and the other may be an HMO. One may offer additional benefits that the other doesn’t.
Carrier A may offer a plan it calls the Cost-Effective Bronze HMO on a state’s exchange. Carrier A may not offer that same plan in the private marketplace. Carrier A only offers the Budget-Friendly Bronze PPO in the private marketplace. Both plans include the 10 essential health benefits, but their network structures (HMO vs PPO) and other benefits differ.
As you may have noticed in the example, carriers are not required to offer all metal plans. That means Carrier A may offer only a bronze plan through your state’s exchange, while Carrier B offers plans at all metal levels. Furthermore, plan availability may vary by region. Carrier A’s bronze plan may only be available in County J and may also be the only bronze option in that region. Meanwhile, County Q residents may choose from four bronze plans.
Another important difference that may occur between plans on and off the state-based and federally facilitated health insurance exchanges is their network variations. One way health insurance carriers keep premium rates low on the exchanges is by keeping the networks narrow.
The network associated with Carrier A’s exchange-based Cost-Effective Bronze HMO may include a much smaller selection of healthcare providers and hospitals than the network associated with Carrier A’s Budget-Friendly Bronze Advantage HMO offered in the private marketplace.
Keep this in mind and carefully compare plan networks to ensure the in-network options fit your personal preferences and are conveniently located.
Carrier options also vary on and off the exchange. Some health insurance companies may be licensed to sell plans in your state but do not offer exchange-based coverage. Other carriers may only sell health insurance on the exchange. And a few may offer health insurance plans on the exchange as well as in the private marketplace.
Pricing on Obamacare exchanges, in the private marketplace
If the exact same health insurance plan is offered on and off your state’s exchange, that plan must be offered at the same premium rate. Otherwise, different plans will have different rates.
If Carrier D offers the Silver Primo PPO+ plan in the private marketplace and the Silver Primo Standard PPO on a state’s exchange, the rates may vary.
If Carrier D offers its Silver Primo+ PPO plan on and off a state’s exchange, an individual can expect these identical plans to have identical rates.
Of course, if you qualify for an income-based premium tax credit or cost-sharing subsidy, the same plan will be less expensive when you purchase it from your state’s exchange. Only health insurance coverage purchased through the state-based and federally facilitated is eligible for financial assistance. Access to this financial assistance is one key way that on- and off-exchange premium rates and out-of-pocket costs vary.
At this time, little in-depth and equal comparison of on- and off-exchange health insurance premium rates has been made. A September 2013 analysis of 10 states in the month before the Obamacare exchanges opened found that 9 of the insurers selling only off-exchange health plans averaged 23 percent lower premiums than other plans in their state.2
Under the Affordable Care Act, rates may not vary based on health history or gender. Age, geographic location, tobacco use, individual vs. family enrollment, and plan category (i.e., metal level) may be taken into account.3
Where to find on- and off-exchange health insurance plans
Comparing health insurance coverage and rates on and off your state’s exchange means determining your options.
Private marketplace – Find out which carriers are licensed to sell health insurance in your state by visiting your state’s department of insurance website. From there, you can visit each company’s website to browse its private marketplace offerings and contact customer service or enter your information for a quote that provides plan availability and pricing in your area.
Obamacare exchange – Visit your state’s exchange website to see which carriers and plans are available, and if you qualify for a tax subsidy.
In both circumstances, you may contact a licensed health insurance agent or broker to learn more about carrier and plan options.
To learn more about the health insurance marketplace and options in your state, including private coverage for individuals and families, small group coverage, Medicare supplement plans, dental insurance and more, visit HealthCare.com
1 HealthCare.gov. “What Marketplace Health Insurance Covers.” N.D. Retrieved from https://www.healthcare.gov/what-does-marketplace-health-insurance-cover/
2 HealthPocket.com “Many Big Brand and Lower Cost Insurers Deserting Obamacare Exchanges.” Sept. 9, 2013. Retrieved from http://www.healthpocket.com/healthcare-research/infostat/off-exchange-vs-on-exchange-premiums
3 HealthCare.gov. “How Health Insurance Marketplace Plans Set Your Premiums.” N.D. Retrieved from https://www.healthcare.gov/what-factors-affect-marketplace-health-plan-premiums/