Why You Should Really Shop for a New Insurance Plan on the Exchanges
Over the weekend the second open enrollment for the Affordable Care Act began and it seems this time Healthcare.gov is mostly stable this time, so consider this is a public service announcement. If you get insurance via one of the new exchanges last year you should really consider shopping around for a new policy.
Polling shows most people who used the exchanges last year aren’t planning to shop around this year and that can turn out to be a costly mistake.
The system technically allows to automatically stay enrolled in the plan you got last time, but the law was designed in such a way that it can be really financially punishing to people that do. This is especially true for people who get tax credits to help cover the cost of their insurance.
The size of tax credits you qualify for are based on your income and the cost of the second cheapest silver plan on your exchange. What this means is that even if the official premiums for your insurance policy don’t change, the amount you are required to pay could theoretically go up significantly. For example if a new cheaper silver plan entered the market this year it would reduce the size of tax credits you qualify for making your current policy more expensive for you. They only way to keep the amount you are paying low would be by changing policies.
Similarly, any change in your income/family/address will impact the amount tax credits you qualify for, so you will want to use Healthcare.gov to update your information. Failing to do so can result in you either paying too much or getting hit with a surprise tax bill at the end of the year.
I know must people find shopping for insurance policy difficult and deeply confusing because it is such an incredibly complex job, but this is the law we currently have. Forcing people constantly shop around for their own insurance was the goal.
This open enrollment period last until February 15th so you have a few months to shop around but it is best not to put it off until the last minute.