When the Affordable Care Act (ACA) was signed into law in 2010, it opened the door to providing health insurance to more people through the Health Insurance Marketplace—commonly also referred to as the Health Insurance Exchange.
Whether you know it as the Marketplace, the Exchange, “Obamacare” or something else, if you utilize the Health Exchange for your health insurance coverage, it pays to know your options. The Marketplace offers a variety of health savings account (HSA) eligible high-deductible health plan (HDHP) options for both individuals and families, which can save you money on monthly premiums and even more through the tax advantages you receive by using an HSA.
If you’re in the market to update your Marketplace plan or get coverage for the first time through the Health Insurance Exchange this year, take a few minutes to read up on some quick tips on smart Marketplace shopping.
Tips for Shopping for an HDHP in the Marketplace
Whether you get your health insurance coverage through the federally facilitated Marketplace at HealthCare.gov or use one of the state-based Marketplaces (depending on where you live), the same tips for smart Marketplace shopping hold true when comparing your HDHP options.
First, know that every plan sold through an official Healthcare Exchange is fully compliant with the Affordable Care Act. Beware that many private websites mimic the look of official Marketplace sites, and commonly pop up as ads at the top of internet browser searches. In order to make sure you’re looking at ACA-compliant options, be sure you’re using an official Marketplace site—either federal or state. Luckily, when it comes to HDHPs, they need to be ACA-compliant regardless of where you purchase them—we’ll touch a bit more on that soon.
Knowing whatever HDHP option you choose complies with the ACA, you can focus on three key elements:
- Plan options–Be sure to compare all HDHP plan options carefully, as the plans themselves vary considerably both in and out of the Exchange. Focus on deductibles, out-of-pocket maximums and other key elements to make your decision. Most importantly, you’ll want to make sure that any HDHP option you choose is HSA-eligible so you can take advantage of a health savings account. Not all HDHPs are qualified to have an HSA. For 2021, an HDHP needs to have a deductible of at least $1,400 for individuals or $2,800 for families in order to be HSA-eligible. Out-of-pocket maximums can’t exceed $7,000 for individuals or $14,000 for families. You can make your search easier by looking for the “HSA-eligible” flag in the upper left-hand corner of an HDHP’s plan card. You can also use the “Filter” option to select only “Health Savings Account (HSA) Eligible Plans.” At the end of the day, remember not to assume that just because they’re HDHPs, they’re the same plans. Dig deeper to find the best option for your specific needs.
- True cost of coverage–Look beyond the monthly premium costs, deductibles and out-of-pocket maximums to discover the true cost of coverage, especially when comparing between HDHP and traditional PPO/HMO options. While at a glance the deductibles and out-of-pocket maximums tied to an HDHP may make it seem like you’re going to spend more money on your healthcare, it’s most often quite the opposite. Learn how to run the numbers to see if an HDHP/HSA option is the best choice for you.
- Premium subsidies–There’s a good chance you may qualify for a premium subsidy—by way of a premium tax credit that lowers your monthly insurance payment—if you purchase coverage through the Health Insurance Marketplace. In fact, if your estimated income falls between 100% and 400% of the federal poverty level for your respective household size, you’ll qualify for a premium tax credit of some type. These premium subsidies apply to HDHPs, not just traditional PPO and HMO plans—just be aware, the only way to take advantage of a premium tax credit is by buying coverage through the Marketplace.
Consider Your Off-Exchange Options
While we’re focusing on purchasing coverage in the Marketplace, it’s worth a quick mention that you do also have off-Marketplace options for HSA-eligible HDHPs.
There may be circumstances where you’d want to explore your off-Exchange options, especially if you’re not eligible for any premium subsidies. Without any premium tax credit, you may be able to find more affordable HDHP options outside of the Marketplace, especially for Silver-level plans.
And even if you’re eligible for premium subsidies, you may still want to look outside the Health Insurance Exchange if you receive ongoing treatment from providers who are only in-network with off-Marketplace insurers or other unique circumstances.
Remember—ultimately where you purchase your health insurance coverage is your choice. Take the time to shop around to find the coverage that’s right—and most cost-effective—for you.
Don’t Forget Your HSA
And speaking of your choice, if you purchase HSA-eligible HDHP coverage on or off the Marketplace, remember that’s only your first step in a two-step process:
- Step 1: Purchase your HSA-eligible HDHP plan
- Step 2: Open an HSA through the provider of your choice
Another awesome benefit of choosing HSA-eligible HDHP coverage is that you get to choose your HSA provider, so choose wisely. No different that comparing your health plan options, compare HSA providers and don’t settle for any provider who offers a basic, transactional account loaded with hidden fees and limited capabilities. If you partner with an industry leader like Bend, you’ll get a powerful, easy-to-use health savings account with all the tools you need to make the most of your HSA—with none of the headaches.
And even if you already have an HSA through another provider, know that you can transfer your existing HSA over to another provider at any time. The choice is yours.
Keep an Eye on Open Enrollment Deadlines
Remember, whether you purchase your coverage through the Marketplace or off-Exchange, you can only buy coverage during the annual open enrollment period or if you experience a qualifying life event that allows you to have a special enrollment period, like marriage or birth of a child.
For 2021 coverage that goes into effect January 1, 2021, open enrollment runs in most states (for all that enroll through the federal HealthCare.gov site) from November 1 through December 15. Other states have specific websites and timelines to enroll—you can find the list here.
No matter where you buy your health insurance, make sure you don’t miss the open enrollment deadline specific to your state.
Get the Tools You Need to Make the Most of Your HDHP and HSA
At Bend, we know an HDHP plus HSA combination can work for anyone, regardless of age, income level or health circumstance. And we know the Marketplace offers many great options for HSA-eligible HDHP coverage.
Pairing an HDHP with an HSA is an extremely effective, affordable and tax-advantaged way for individuals and families to save and pay for current and future expenses while taking a more active role in their healthcare. Along with the lower premiums that come with an HDHP, HSA participants enjoy a triple tax advantage, flexibility of use, account portability, rollovers, investment opportunities and more.
Take some time this open enrollment season to see how choosing an HSA-eligible HDHP can make your healthcare dollars work smarter for you. Then connect with us to open your Bend HSA and take the first steps to better financial wellness. It’s quick, easy and painless when you partner with Bend.
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