How to Apply for Obamacare

Everyone talks about signing up for Obamacare, but what does that mean? How do you sign up for health insurance under Obamacare?

Obamacare is a nickname for the health reform law known as the Affordable Care Act. It was signed by President Obama in 2010 but major provisions of the law only came into effect in 2014. It radically changed the way the health insurance market works in the United States, especially for people who buy health insurance on their own.

When you “sign up for Obamacare” you’re not signing up for a government-run health insurance plan. Really, you’re signing up for an individual or family health insurance plan offered by an insurance company. All major medical health insurance plans available today are “Obamacare” now.

If you qualify based on your income, you may also be directed to enroll in Medicaid when shopping for coverage. Medicaid was expanded under the Obamacare law in most states.

Step 1 when applying for Obamacare: Make sure you can enroll right now

You can’t just sign up for Obamacare whenever you want. You can only sign up when it’s open enrollment season or when you experience a qualifying life event that makes you eligible for a special enrollment period.

Obamacare open enrollment period

Obamacare created a once-per-year nationwide open enrollment period when pretty much anyone can enroll in a health insurance plan. So, if you want to enroll in coverage, one of the first thing you need to know is whether it’s currently open enrollment season:

• Obamacare open enrollment for 2016 plans began on November 1, 2015 and is ended January 31, 2016.
• Obamacare open enrollment for 2017 plans is scheduled to begin on November 1, 2016 and to end on January 31, 2017

Obamacare open enrollment dates are subject to change, so these dates may alter from one year to another.

Obamacare special enrollment period

Now if it’s not open enrollment season, you may still be able to get Obamacare coverage, but only if you’ve experienced what the law calls a “qualifying life event.” These are major changes in your life that may make it necessary for you to get a new health insurance plan or apply for subsidies (we’ll talk about subsidies later).

Qualifying life events under Obamacare include the following:

• Getting married or divorced
• Having a child or adopting a child
• Losing your employer-based health insurance coverage
• Moving to a new city or state where your old health insurance plan no longer works
• Major changes to your income that alter your eligibility for subsidies
• And more

Generally speaking, if you experience a qualifying life event, you’ll have sixty days from the date of that event to enroll in an Obamacare health insurance plan. This is your “special enrollment period.”

Step 2 when applying for Obamacare: Look at your health insurance budget

The next thing you want to do is understand how much you’re likely to use medical care in the next year, and what you can afford in terms of monthly premiums and in terms of cost-sharing. Cost-sharing comes into play when you actually receive medical care. Forms of cost-sharing include copayments and deductibles.

So ask yourself:

• How often did you see the doctor last year? Never? Once or twice but only for preventive checkups and screenings? More often, maybe for treatment of a chronic condition? Did you use prescription drugs at all, or on a regular basis?

Hopefully you saved some of your receipts from the past year, or can estimate the following costs:

• How much you spent on monthly health insurance premiums per month last year (if anything)
• How much you paid in copayments when you saw the doctor or picked up a prescription
• How much you paid toward your annual deductible or for other out-of-pocket costs

Copy down your estimates and set them aside.

Step 3 when applying for Obamacare: Review your preferred doctors and prescription drug needs

Do you have a doctor that you just love, or a clinic or hospital that you like or which is really conveniently located for you? Lots of us do.

Not all doctors accept all health insurance plans, even under Obamacare. It’s the same with clinics and hospitals. So if there’s a medical provider that’s really important to you and you want to keep visiting him or her, copy down that doctor’s name. You’re going to want it later.

While all Obamacare plans will cover prescription drugs, different plans may cover different drugs, or cover them at radically different out-of-pocket costs to you. So if you take prescription drugs on a regular basis, copy down the name of your drug (brand name or generic). It’s going to come in handy when you’re comparing your Obamacare coverage options.

Step 4 when applying for Obamacare: Go online and compare plans

Now you’re ready to actually start looking at your coverage options. The easiest way to do that is online. Depending on where you live, you may have a few different options.

• Federally-run marketplaces: Many states share a federally-run health insurance marketplace known as Healthcare.gov. It will show you a selection of the Obamacare plans available in your area.
• State-run marketplaces: Some states run their own government health insurance marketplaces where you can see what’s available. They also show you a selection of the Obamacare plans available in your area.
• Private marketplaces: In most states, you can also shop through a private health insurance marketplace that may offer even more Obamacare-compliant plans to choose from, including the same ones offered by the government marketplace. Some people feel that the online shopping experience is smoother with private marketplaces, and there are generally licensed agents available to help you with personal recommendations based on your needs and budget.

When reviewing your coverage options, find out which ones are accepted by your preferred doctor and which ones will cover the prescription drugs you need at a price you can afford. A lot of this information is available through online marketplaces, and a licensed health insurance agent can also be a big help. If you really want to make sure that your doctor accepts a plan, however, you should also call his or her office to confirm.

Step 5 when applying for Obamacare: Know if you qualify for subsidies

Obamacare makes government subsidies available to qualifying consumers with household incomes of no more than 400% of the federal poverty level. In most states, that’s about $47,000 for a single person or about $97,000 for a family of four (2016 figures).

Obamacare subsidies are designed to cover a portion of the monthly premium that you’ll have to pay to maintain your coverage from one month to another. If you qualify for subsidies, it can make a big difference in helping you find affordable coverage.

Government-run marketplaces can help you apply for subsidies, but many private marketplaces work in cooperation with government marketplaces and can also help you apply for subsidies.

A word of caution about subsidies: They’re based not on your income last year, but on your estimated income this year. That means that if you earn more than expected, you may be required to pay back a portion or all of the subsidy dollars you received during the year. That pay-back will happen when you file your federal tax return for the year.

Step 6 when applying for Obamacare: Select a plan

Private online health insurance marketplaces (and some government marketplaces) will allow you to compare your options side by side. Some will also let you sort plans based on their monthly premium, deductible, and on the doctors that accept the plan. You can also look up each plan’s drug formulary to make sure it covers the prescriptions you need.

Once you’ve narrowed down your choices and you’re ready to make a final decision, be sure that:

• You can afford the monthly premiums you’ll be required to pay
• You can afford the annual deductible in case of serious medical issues
• The copayments for office visits and prescription drugs are affordable for you
• Your preferred doctor(s) or medical facilities are in network and accept this plan
• The prescription drugs you need a covered

Step 7 when applying for Obamacare: Enroll!

Enrollment in an Obamacare health insurance plan is typically completed online. Complete the subsidy application (if you qualify) and the health insurance application.

You’ll also likely be required to provide some sort of payment for the first month of coverage. This is usually done with a credit card, but you may be offered other ways to do this as well.

Once you’re application materials are submitted it may take couple weeks before your enrollment is confirmed and you receive your medical insurance cards in the mail.

In closing, one more thing to remember

Congratulations! You’ve just signed up for Obamacare.

Just remember that you can’t run out to the doctor right away and expect to be covered. When you enroll in an Obamacare health insurance plan your coverage doesn’t begin immediately. The date on which it starts will depend on which day of the month you submitted your application materials.

If you don’t remember the coverage start date that was quoted for you online, call the insurance company or ask your licensed agent to confirm it for you.