How to Buy Small Group Health Insurance img

How to Buy Health Insurance if You Don’t Qualify for a Subsidy

A health insurance subsidy provides tax credits to qualifying individuals to make monthly health insurance premiums more affordable. If your annual income is too high to qualify for a subsidy, you can shop for more affordable alternatives, such as short-term plans, to fulfill your health insurance needs until you can purchase more comprehensive coverage.

Who Qualifies for Subsidies?

Those who qualify for government subsidies – in the form of premium tax credits or extra savings – typically have a household income between 100% and 400% of the federal poverty line.

Your income in comparison to the federal poverty line or (FPL) is what determines if you are eligible for government subsidies to help offset the cost of health insurance. There are two types of subsidies: premium tax credits and cost sharing subsidies.

Premium tax credits are the most common type of subsidy and help you save on your monthly premium. Cost-sharing subsidies help offset the costs of out-of-pocket expenses such as deductibles and copays.

However, there is a steep cut off for subsidies in most states. This eligibility cut off with no phase out is referred to as the “subsidy cliff”.

Middle-income individuals and families who make just above the subsidy cut off of 400% of the FPL do not qualify for subsidies. This means that earning as little as $204 per year could put an individual or family over the 400% line and make them unqualified for subsidies.

With the average monthly cost for health insurance coming in at $440 for an individual, and $1,168 for a family in 2018 Many find it difficult to afford health insurance without a subsidy.

With the average monthly cost for health insurance coming in at $440 for an individual, and $1,168 for a family in 2018. Many find it difficult to afford health insurance without a subsidy.

What if I don’t qualify for subsidies?

While the ARPA has expanded subsidies to make health insurance more affordable for millions of Americans, there are still people that may not be able to afford a marketplace plan because they are not eligible for financial assistance. These individuals and families may find other affordable coverage options in their area that will provide necessary health insurance at a lower rate.

To have the minimum essential coverage guaranteed by the ACA, you must buy an ACA-compliant plan. One low-cost option is to enroll in the lowest-priced bronze individual or family plan available in your area. However, this is not your only choice.

Alternative Health Insurance Options

If you are an individual under the age of 30 – or qualify for a hardship exemption – and are in generally good health, you may be eligible for a catastrophic plan. Catastrophic plans are low-premium plans that tend to have a high-deductible but offer ACA-compliant coverage.

In most states, you can also buy short-term health insurance plans. Premiums for short-term plans tend to be substantially lower than those of comprehensive health plans available on the marketplace.

Although they are called short-term plans, you typically can keep your coverage up to 3 years in most states by simply renewing your plan annually. While these plans do not offer the comprehensive coverage of a major-medical health insurance plan, they do provide an affordable alternative to ACA-compliant plans that can keep you covered in worst-case scenarios.

If you enroll in a short-term plan, you will pay a monthly premium and a deductible. These plans typically offer the following benefits:

  • Some prescription medications
  • Visits to your doctor
  • Hospitalization due to illness or injury

Keep in mind that short-term plans can deny coverage for these services based on a pre-existing medical condition.

Contact Insurance Enterprise for Group Health Insurance

If you have questions about group health insurance and need health insurance quotes, contact Insurance Enterprise at 888-350-6605. Speak to a licensed agent and find out more about how you can get an affordable health insurance plan.