With all the hype around the Affordable Care Act and the provisions that will go into effect in the new year, it’s easy to be overwhelmed with the amount of information that needs to be learned in order to make the right decision about which insurance plan to go with or whether to just opt out.
According to the article “Will College Students Use Affordable Care Act Insurance” in USA Today, “many young students say they think health insurance is important, nearly 80 percent know little about the Affordable Care Act’s new insurance marketplace.”
The website coveredca.com allows you to shop for healthcare online. A key provision of the ACA allows a person to stay on his or her parents’ insurance until age 26 regardless if they are a young adult, married, or eligible for an employer insurance plan. But what happens when a person is too old to be on their parent’s insurance plan?
They may be able to access free or discounted coverage through medicaid.
Finals are just around the corner and students tend to have a lot on their plates around this time of year.
Although everyone is supposed to be covered by the 2014, you have the choice to opt out of getting insurance and pay the penalty of $95 for the first year.
The National Center for Public Policy Research’s David Hogberg recently found that more than 3.7 million young adults will be at least $500 better off if they forgo insurance and pay the penalty.
“I think a lot of them will find that it makes more sense for them to remain uninsured, remain on their parents’ plan,” says Hogberg.
Every year you don’t sign up, the penalty goes up. In 2015 the fine jumps to $325, in 2016 its $695 and 2017 $800. The penalty can never exceed the lowest premium for that person.
“Insurance companies will be paying out a lot of money this year for sick people because the penalty is so low young people wont mind incurring the fee,” says healthcare insurance specialist Jill Elder for Pediatrix.
If you take the cheaper route, could be facing a much bigger financial burden if they find them self sick. Be prepared for higher co-pays and deductibles when you see a doctor. Opting out sounds cheap, but medical bills can add up. It costs $1500 just to see a doctor and receive a prescription and an x-ray can cost up to $2500. A broken leg will cost you $7,500 and a three-day hospital stay is $30,000 according to healthcare.gov and you will be personally responsible for your own medical bills.
Sports players might consider the cost of torn knee ligaments (about $5,000 for ACL reconstruction), and young women should be aware of the cost of pregnancy and newborn care (which can add up to thousands of dollars depending on the type of birth).
The Department of Health and Human Services says nearly 50 percent of Americans ages 18 to 34 will be able to purchase a health insurance plan through the ACA for less than $50 per month, which adds up to just $600 per year. The government also offers subsidies to people who earn less than four times poverty level – about $46,000 in 2013 – which helps to make premiums affordable.
You can have Medicaid as a single person. Before you had to have a child to qualify. If you make less than $15,856 you qualify for Medicaid. If you make more than that you will have to pay for your own insurance, pay the penalty or be insured by your parents.
Employers who don’t provide insurance for full-time employees will be fined $2000 per each employee. Employers may decide to opt out of paying this first year as well because of the low fines.
“I honestly don’t know anything about insurance, what are we supposed to do?,” said sophomore Raul Ruelas. “I turn 26 in a year, I guess I can’t bartend anymore.”
There is one premium for everyone. Those who don’t use insurance as much pay the same amount as people that do go to the doctor all of the time. Another effect of ACA is insurance for males will increase. There is not a difference in premiums between males and females now. Although it cost more to insure a female because they see the doctor more often than males do, both will pay the same fees.
“I think we need something. I think it still needs a lot of tweaking. There’s an answer in this somewhere. Until we can predict the behaviors of the uninsured, we will have a better understanding of what needs to be tweaked. Only time will tell. It’s too soon to predict all of the downfalls,” says Elder.
Some young people will still not want or be able to afford health insurance, despite your best intentions. Discuss your options with your parents, the health center or research on coveredca.com
There are three important provisions of the Affordable Care Act for college students:
1. Students can enroll in plans without the threat of being denied coverage because of a pre-existing condition.
2. Students who earn less than about $46,000 or families that earn less than $94,000 annually may be able to access free coverage through Medicaid or discounted coverage
3. New plans will provide free preventive services, annual checkups, prescriptions and substance abuse/disorder services.
Important Dates to Remember
- Dec. 23, 2013 is the last day to sign up if you want a health plan.
- Jan. 1, 2014 is when coverage starts for those who signed up.
- March 31, 2014 is the last day of open enrollment. It is also the day by which you must enroll to avoid a tax penalty for not having insurance.
- After March 31, 2014, you will have to wait until 2015 to sign up for a plan.