Obamacare expert answers questions on health insurance

Michelle Singletary
Columnist September 30, 2013

This online feature may include questions adapted from my weekly live chat. It’s also an opportunity for me to answer questions I couldn’t get to during the discussion. I may also respond to questions you send by e-mail to (colorofmoney@washpost.com), Twitter (@SingletaryM) or Facebook

During one of my recent online chats, I spoke with Don Silver, author of “The Best ObamaCare Guide: For You, Your Family and Your Business.” Silver’s book is September’s Color of Money Book Club pick. Here’s his responses to some reader questions.

Michelle Singletary writes the nationally syndicated personal finance column, “The Color of Money.” View Archive

Q: Why should a healthy young person sign up for insurance. Can’t he just wait and save that money?

Silver: Yes and no. If you stay healthy, of course, you would save the money that would go towards a premium. However, if you have an accident or medical condition that requires medical attention, you are rolling the dice as to how your finances will be affected.

My suggestion is for you to investigate how much it will cost you to get health insurance on a Marketplace exchange. Cost means more than premiums. You may also face paying for a deductible, co-pays and co-insurance.

There are two types of subsidies that may be available to you to lower costs depending on your household income level. One is a subsidy to help pay premiums. The other is a cost-sharing subsidy that can reduce deductibles, co-insurance and the annual out-of-pocket maximum medical bill cost.

This is very important. If your income level qualifies you to get the cost-sharing subsidy, that subsidy is only available if you get a Silver level plan. The premium subsidy applies to the Bronze, Silver, Gold and Platinum plans.

It’s worth your time to get a dollars-and-sense answer for your exact situation. Don’t assume it won’t be worthwhile for you to skip getting health insurance.

Q: I would prefer to purchase health insurance and receive a subsidy instead of being put into Medicaid. (1) Is it true there is a stigma attached to Medicaid and that many doctors don’t participate in Medicaid? (2) If I’m required to estimate my 2014 income and then at the end of the year it turns out to be lower than is needed to qualify for the subsidy (i.e., it’s low enough to require me to use Medicaid), what happens? Am I put into Medicaid retroactively? Will I have to repay the subsidy that I received?

Silver: If you apply for government assistance under the Affordable Care Act and qualify for Medicaid, you must either accept Medicaid or pay for the insurance all out of your own pocket. (1) It is true that about 50 percent of doctors do not take on Medicaid patients. (2) It is important to promptly notify the Marketplace exchange of changes in income, family size and tax filing status. The exchange will determine where you should be placed. If a Marketplace exchange determines you qualify for the premium subsidy but not Medicaid, and your actual household income turns out to be low enough to be eligible for Medicaid, you don’t need to repay the subsidy unless you received a larger credit than you were entitled to. If your household income is less than 100 percent of the Federal Poverty Level, you won’t have to pay back any of it.

Q: I am a small-business owner from Michigan. My family and I run a small daycare in which only two of us have health insurance through a state program for small-business owners, Wayne County Four Star. Initially it was about $80; that was a few years ago. As of January 2013 it was up to $125 or so, and then July 2013 it jumped again to $187! My question is I have no idea what to expect from the new Affordable Healthcare/Obamacare? Making under $40,000, single, no children --- it’s frustrating to even think about. Where would I begin as a self-employed person to even discuss prices and options? And what price should I be expecting to pay? Thank you for any assistance.

Silver: The good news is that you should qualify for a premium subsidy on a Marketplace exchange because your income is below 400 percent of the Federal Poverty Level (FPL). This will reduce your monthly premium cost.

Subsidies are available for household income between 100 percent and 400 percent of the FPL. For a single person, 400 percent of the FPL is $45,960 based on 2013 numbers. You are below that amount. Be aware that if your 2014 household income is at or above the 400 percent limit, you would pay all of the premium cost out of your own pocket. That means you might want to carefully plan your 2014 income (including timing of purchases of equipment to get a deduction).

To know how much you’ll pay after deducting the subsidy, go to the Web site of your state’s Marketplace exchange. In your case, since the federal government is running the exchange, you should go to www.healthcare.gov. You can also call the federal government help center at 1-800-318-2596.

For others, you can find your state’s Marketplace exchange at www.healthcare.gov/what-is-the-marketplace-in-my-state/

Follow me on Twitter at @SingletaryM, or connect with me on Facebook at www.facebook.com/MichelleSingletary.com.

Readers may write to Michelle Singletary at The Washington Post, 1150 15th St. NW, Washington, D.C., 20071, or e-mail michelle.singletary@washpost.com. Personal responses may not be possible, and comments or questions may be used in a future column, with the writer’s name, unless otherwise requested. To read previous Color of Money columns, go to postbusiness.com.

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