The Health Reform Metallic Plans and Health Subsidies

There are all kinds of new terms ushered in with the Health Reform bill and one of the most original is the Metallic Plan.  What are these shiny new (and they are all brand new) health plans and what do they have to do with any potential health subsidy available to Americans.  Great question and there are very significant ties between the new Metallic Health Plans and Subsidies.  Let's take a look at the plans and this all works.

First, what are the Metallic health plans?

The ACA Health Reform bill proposed that four different plan levels would be offered in the Health Exchange plus one catastrophic option for people under age 30.  The four basic levels are Platinum, Gold, Silver, and Bronze.  Roughly speaking, the Platinum should cover 90% of the average health care costs leaving 10% to the enrollee.  The Gold would cover 80% of this "actuarial value".  The Silver would cover 70% and the Bronze would cover 60% of the expenses.  That's how they were crafted.  The catastrophic option for younger people would cover 50%.  The bill further stated that a plan available on the Exchange must also be offered off the Exchange but health subsidies are only available in the Exchange.  You can quote health plans both in the Exchange or out through our Quote Page starting Oct 1st, 2013 when they come online.  So, how do these new plans tie with any proposed health subsidy?

Silver is the new black (for health plans)

The Health Reform bill further stipulated that the health subsidy, if a person is eligible, will apply to any Metallic health plan in the Exchange but the cost sharing benefit will only apply to the Silver plan.  Why not the other plans?  The thought was that if a person can qualify for a subsidy based on having an income under 400% of the Federal Poverty Level, the Bronze benefits would not be rich enough (too high out of pocket for medical bills) and the Platinum and Gold would be too expensive (even with subsidized amount). The Silver therefore became the lucky target of any health subsidy as part of the bill.  There is another Benefit Upgrade Rule which we'll discuss separately for those making up to 250% of the Federal Poverty Level.  Each State might interpret the rules slightly differently but let's assume that the Silver health plan is the plan that will offer you a subsidized premium if you are eligible.

How will the Silver plan enrollment work with the Health Subsidy?

The process is supposed to be pretty streamlined.  When you run your health plan quote, the system will automatically request income information to establish if you qualify for a health subsidy.  You can then quote Health Exchange plans that are eligible for the Subsidy and it will only charge you for the net premium (total premium minus the subsidy based on income, family #, etc).  You will be billed going forward for the net amount of premium monthly.  This is great news as it doesn't require the applicant to pay the full amount up front and recoup the subsidy later on (at tax time for example).  Starting Oct 1st, 2013, you can run your Health Quote with and without Subsidy at no cost to you.

 



Los Angeles, Family of 4
making $60K.
  Subsidy=$8,388*


Iowa, Single Adult making $30K
Subsidy=$4,222*

*Based on age, expected costs, and other assumptions according to Kaiser Calculator.  Actual subsidies will vary and official subsidy amounts will be available Oct 1st, 2013. 


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