Which ACA plan should you choose?
BY Anna Porretta Updated on October 21, 2022
What is an Affordable Care Act (ACA) plan?
Enacted in 2010, the Affordable Care Act (ACA) expanded health insurance coverage to more than 20 million people by increasing benefits and lowering health insurance costs to make coverage more affordable. Also, the ACA expanded access to health insurance with the creation of a federal marketplace (sometimes referred to as an exchange and state-administered marketplaces in some states.
ACA plans (also known as Qualified Health Plans) are major medical insurance plans certified by the ACA Health Insurance Marketplace to be offered on the marketplace. All ACA plans –
- Provide Essential Health Benefits
- Follow established limits on cost-sharing (such as deductibles, copayments and out-of-pocket maximum amounts)
- Provide coverage for people with pre-existing conditions
- Eliminate annual and lifetime dollar limits on health insurance coverage
- Provide 100% coverage for preventive care and cancer screening.
The 10 essential health benefits include:
- Emergency services
- Out-patient services
- Maternity and newborn care
- Mental health, behavioral health, and substance use disorder services
- Prescription Drugs
- Rehabilitative and habilitative services
- Laboratory services
- Pediatric services, including oral and vision care
- Preventative and wellness services and chronic disease management
ACA-compliant plans are also available off the marketplace. You can purchase ACA-compliant health insurance and other types of insurance directly from the insurance company or through a private marketplace.
In addition, off marketplace health insurance offerings include non-ACA compliant medical plans, which do not include all of the benefits and consumer protections of ACA plans as well as insurance that is not regulated by the ACA, such as indemnity plans and short-term insurance policies.
ACA plan vs. non-ACA plan – which is the best choice?
Your decision as to whether or not to purchase ACA-compliant health insurance is likely to be determined by several personal factors. For example, if you find yourself without insurance and waiting a brief time to enroll in ACA-compliant group health coverage, Medicare or an ACA-compliant individual plan, you are likely to want the protection of non-ACA health insurance, such as short-term health insurance coverage.
When considering an ACA plan vs. a non-ACA plan, keep in mind –
- ACA plan enrollment is limited to the annual Open Enrollment Period in the fall for coverage the next year unless circumstances in your life make you eligible for a Special Enrollment Period, such as loss of other coverage, having a baby, or getting married.
- If you qualify, premium subsidies are only available if you purchase an ACA plan on the marketplace and cost-sharing reductions are only available if you choose a Silver plan on the marketplace. You can get subsidy estimates while searching for plans, so you can have an idea of how much financial support you’ll be getting.
- Although the individual tax penalty has been removed at the federal level, if you live in an area where the state mandates individual coverage, you may be penalized if you choose a non-ACA plan. Be sure to check your state’s requirements.
- Often non-ACA plans such as short-term and indemnity plans can be purchased anytime during the calendar year. Similarly, they are easy to cancel anytime.
What are the different types of ACA plans?
There are 4 main types of ACA health insurance plans:
- PPOs – or Preferred Provider Organization Plans
- POSs – or Point-Of-Service Plans
- HMOs – or Health Maintenance Organization Plans
- EPOs – or Exclusive Provider Organization Plans
Factors such as your budget, where you live, and the kind of health care you require are important to consider when choosing among ACA plans.
PPO (Preferred Provider Organization Plans)
Preferred Provider Organization plans, also called PPOs, are one of the most popular plan types for individuals and families. PPOs allow you to visit whatever in-network health care provider you’d like without requiring a referral from a primary care provider.
In-network care will be covered at a higher benefit level than any care you receive out-of-network.
You can expect PPO plans to require you to pay an annual deductible before the insurance company begins paying its portion for most services. Additionally, you may also have a co-pay (according to eHealth surveys, co-pays are usually around $10-$30) or coinsurance that you have to pay for certain health care services.
A PPO plan may be the right ACA plan for you if:
- You want to freedom to choose almost any medical facility or provider for your needs
- You want some coverage if you choose to go out-of-network
- You don’t want to have to receive a referral first from your primary care provider in order to see a specialist
HMO (Health Maintenance Organization Plans)
HMO, or Health Maintenance Organization, plans offer a wide range of healthcare services through a network of providers who agree to supply these services to members. You’re likely to have coverage for a broad range of preventative healthcare services than you would through another plan.
As of 2018, HMOs have emerged as the most popular ACA plan among eHealth customers. According to a recent study, 53% of shoppers selected an HMO plan in 2017.
You will be required to choose a primary care physician (PCP) who will take care of most of your health care needs. Your PCP will need to refer you to a specialist if you decide you need to consult with one.
While HMOs typically have lower out of pocket costs, you may be required to pay a deductible before your HMO begins paying its portion for covered health services. Your copays will likely be reasonable, and for services such as doctor office visits, you may pay a copayment of $20 – $35 and the HMO will pay the rest of the eligible charge. No deductible may apply to the doctor visit. Keep in mind that with an HMO you will likely have no coverage for non-emergency care you receive out-of-network or for services you receive without a proper referral from your PCP.
A HMO plan may be the right ACA plan for you if:
- You’re shopping for an ACA plan with a low monthly premium
- You want an ACA plan with little or no deductible
- Your typical care is preventative care services
POS (Point of Service Plans)
A Point of Service Plan, or POS, has some qualities of an HMO and PPO with benefit levels depending on if you receive care in or out-of-network. You can think of a POS plan as a HMO/PPO hybrid.
Similar to an HMO plan, with a POS plan you will have to designate a PCP who will make referrals to in-network specialists when you require it. Typically services received through your PCP are typically not subject to a deductible. Preventive care services are covered at the PCP office visit copayment.
Similar to a PPO plan, you may receive care from providers who are out of your provider network, but your out-of-pocket costs will be greater. You will likely pay a higher co-pay, coinsurance, or deductible for out-of-network services than applies to in-network services.
A POS plan may be the right ACA plan for you if:
- You are willing to coordinate your care through your designated primary care physician
- Your preferred doctor participates within the plan network
EPOs (Exclusive Provider Organization Plans)
With an Exclusive Provider Organization plan, or EPO, you exclusively use the healthcare providers – this includes doctors, specialists, and hospitals – within the plan network. You don’t need a referral, but if you pay the full medical bill if you out outside the plan’s provider network for non-emergent care that the plan hasn’t authorized coverage before you receive it.
An EPO plan may be the right ACA plan for you if:
- You do not want to have to get a referral to see a specialist
- Your preferred providers are in-network
- You want to receive a lower monthly premium than what you would typically get with an HMO or a PPO plan
You can start shopping for a health insurance plan that fits your budgetary and coverage needs at any point in the year. However, you can only enroll in an ACA-compliant plan during the annual open enrollment period – which runs from November 1stthrough December 15th in most states – or during a special enrollment period.
eHealth’s intuitive site and license health insurance agents can help you compare your health insurance plan options to find the plan that suits you best. Visit our Individual & Family health insurance page today to see the ACA compliant plans that are available.
How to pick a health insurance plan: Health insurance plan & network types: HMOs, PPOs, and more. Centers for Medicare & Medicaid Services. at https://www.healthcare.gov/choose-a-plan/plan-types/