On Oct. 1, a little more than 100 days from now, the government will open its insurance "exchange," a marketplace on the Internet where individuals may shop for health insurance. The exchange is designed chiefly for people who don't have insurance through their employers.
For many of those who can’t afford the premiums, the government will offer subsidies to help pay for insurance.
How will it work?
The exchange will be a website that enables you to apply for insurance for yourself and your family and lets you compare prices and options.
Key ingredients
The most important factors in this calculation are your age, where you live, how much you earn and whether you smoke.
- Age: Health risks are lower for younger people; so are insurance rates.
- Home area: Rates are lowest in metro Atlanta and highest in South Georgia.
- Income: The government will pay part of the insurance cost on the exchange if your income falls between 100 percent and 400 percent of the federal poverty rate.
- Smokers are at higher risk of illness, so their insurance costs more.
The color key
Each plan is classified as platinum, gold, silver or bronze. Platinum and gold cost the most but provide the best coverage. Each plan’s “metal” designation is based on the percentage of health care expenses it would cover, on average, for a large group of people. Bronze plans cover 60 percent of expenses, leaving the consumer to pay the remaining 40 percent; silver plans generally cover 70 percent, and gold plans 80 percent. (Platinum covers 90 percent, but most insurers won’t offer many platinum plans on the exchange because they will be so costly.)
To study the likely costs of plans on the exchange, the AJC selected one proposed plan from the gold, silver and bronze tiers offered by Blue Cross and Blue Shield of Georgia. (Seven companies applied to sell insurance on the exchange, but these examples are limited to selected plans on Blue Cross’ filing.) Note that insurers may offer more than one plan within each “metal tier” with co-payments and deductibles that will vary. Here is the cost-sharing information related to the selected plans:
- Gold plan: $750 deductible, 0 percent coinsurance
- Silver plan: $2,000 deductible, 20 percent coinsurance
- Bronze plan: $6,300 deductible, 0 percent coinsurance
The prices, which are premiums per month, assume that the consumer lives in metro Atlanta and is a nonsmoker.
CONSUMER PROFILE: 26-year-old single person
- Gold: $355
- Silver $267
- Bronze: $201
Subsidy examples
Income: $12,000 a year (just above federal poverty line). This person would be expected to contribute about $240 a year toward a silver plan. A subsidy projected at about $2,800 would pick up the remainder of the cost.
Income: $35,000. This person is unlikely to get a subsidy since the cost of a silver plan (about $3,000) would be less than 9.5 percent of her income – what this consumer would be expected to contribute given his or her income level.
CONSUMER PROFILE: Husband is 32, wife is 30, 1-year-old daughter
- Gold: $1,024
- Silver: $771
- Bronze:$580
Subsidy examples
Income: $20,000 (just above the poverty line). The family would be expected to pay $400 toward for a silver plan.A subsidy projected at about $8,500 would cover the rest.
Income: $60,000 (about 300 percent of poverty line). Family would be expected to pay $5,700 a year toward a silver plan and could get a subsidy of about $3,200 to cover the rest of the cost.
CONSUMER PROFILE: Husband is 47, wife is 42, kids are 25, 20 and 16
- Gold: $1,790
- Silver: $1,348
- Bronze: $1,014
Income: $28,000 (at poverty line). The family would be expected to pay $560 toward a premium and could get a subsidy of about $15,000 a year to cover the rest of the cost.
Income: $84,000 (300 percent of poverty). Family would be expected to pay about $8,000 a year for a silver plan and could get a subsidy of about $7,600 to cover the rest.
CONSUMER PROFILE: Husband and wife are both 62
- Gold: $1,994
- Silver: $1,500
- Low Bronze: $1,130
Subsidy examples
If this couple’s income is $16,000 a year (at the poverty line) it would be expected to pay $320 a year toward a premium and could get a subsidy of about $17,000 to cover the rest of the cost of a silver plan.
If this couple’s income is $47,000 a year (300 percent of poverty line) it would be expected to pay about $4,500 toward a plan and could get a subsidy of about $13,000 to cover the rest of the cost of a silver plan.
Subsidy calculators
The Kaiser Family Foundation's subsidy calculator helps you determine the amount, if any, the government might pay toward your insurance bill. Another option is the state of Colorado's exchange site. See "Calculate your savings" at bottom left of the home page.
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