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Posted: 6:00 a.m. Thursday, Sept. 26, 2013

Obamacare health care exchanges now open



By Clark Howard

ClarkHoward.com


Understanding the Exchange System

Beginning Oct. 1, you can shop the health care exchanges for policies that become effective January 1, 2014.

What does this mean to you? It means that as an individual or a small business, you will be able to see quotes from however many insurers choose to participate in your part of your state. (See a list by state.)

I expect Obamacare will most help people who are 50-64 and have had trouble getting insurance, and anyone who has a pre-existing condition and is looking for insurance.

Under the health care exchanges, you'll be able to shop based on your age without regard to pre-existing conditions. You can pick from a very basic policy to one with greatest amount of coverage...and everything in between.

Based on your income, you will either be charged full retail for the policy or there will be subsidies on a sliding scale based on your income. For example, a low income earner may be able to get insurance for free or nearly free.

We don't know yet how this is going to play out. Some people in rural areas may face very high premiums because only a single insurer has decided to compete on the exchanges. And then in urbanized areas, there may be as many 8 or 10 different insurers competing for business and that will drive premiums down.

What's in the Health Plans

Each of the plans available to you through the online marketplaces starts with a core of what's called "essential benefits."

This includes coverage for emergency services, hospitalizations, lab services, maternity care, mental health and substance abuse treatment, outpatient care, pediatric care, preventive care, rehab services, and vision and dental for children.

It's the bedrock of what every plan offers. The difference between plans is in your out-of-pocket costs, which include office visit copayments, the deductible, and how much you pay after the deductible.

There are four basic types of plans available across all the  health care exchanges:

  • Bronze - 60/40 split -- the plan pays 60% of costs after the deductible and you pay 40%
  • Silver - 70/30 split
  • Gold - The traditional 80/20 split that's familiar to many people
  • Platinum - 90/10 split