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Examining your health insurance options under Obamacare

With open enrollment in the state's new health insurance marketplace beginning this week, it's a good time to answer some commonly asked questions.

September 27, 2013|By Lisa Zamosky and Chad Terhune
  • President Obama greets a child flanked by Rep. Donna Edwards (D-Md.), right, and House Majority Whip Steny Hoyer (D-Md.), left, after speaking about healthcare at Prince Georges Community College.
President Obama greets a child flanked by Rep. Donna Edwards (D-Md.), right,… (Mark Wilson, Getty Images )

Starting Oct. 1, millions of Californians can start signing up for health insurance under the federal Affordable Care Act.

In addition to new coverage options, the healthcare law changes the rules of the insurance game for many consumers. It also requires most Americans to get health insurance or pay a penalty.

Here are some answers to commonly asked questions. Please share your comments or ask questions at healthcare@latimes.com. Submissions must include names and phone numbers.

Do I need to do anything right now?

You have time to consider your options. You can start signing up for health insurance Tuesday through Covered California, the state's new marketplace.

The earliest policies take effect is Jan. 1. You'll need to buy a health plan no later than Dec. 15 if you want your benefits to kick in at the start of the year. Enrollment for the state exchange runs through March 31. Medi-Cal, the state's Medicaid program, accepts applicants year round.

Where do I go to enroll?

In California, go to the Covered California website or call the health marketplace at (800) 300-1506. The state can also refer you to community groups, insurance agents and government offices that offer enrollment help in person.

Outside California, visit HealthCare.gov to find the link and other contact information for the marketplace in your state.

I get my insurance through work. Will that be affected next year because of all this?

Most people with health insurance through work won't be directly affected by the overhaul.

Employers will keep adjusting their health benefits as they have for years, but in most cases those changes in coverage or worker contributions have little to do with the Affordable Care Act. Changes are driven largely by employers' efforts to reduce their healthcare costs.

How much will this new health coverage cost?

That depends on your age, where you live, the level of coverage you want and whether you qualify for a federal subsidy based on your income.

Four basic levels of coverage are sold through Covered California: Bronze, Silver, Gold and Platinum. Bronze plans are generally the least expensive, while Platinum plans are the priciest.

For example, a family of four in Los Angeles earning $65,000 a year could pay $384 a month for a mid-level Silver plan.

In general, more comprehensive plans have more expensive premiums but have lower out-of-pocket costs for medical care. For instance, a Bronze plan on average covers 60% of a person's total healthcare costs. At the high end, Platinum plans cover 90%.

People younger than 30 also have the option of a less expensive and more limited policy.

There are subsidies: Individuals earning less than $45,960 annually may qualify for federal tax credits that lower their monthly premium. Subsidies are available for a family of four making less than $94,200.

For a sense of what health insurance may cost you, check the state's calculator.

Can I wait until I get sick to enroll?

No. There is a six-month open enrollment period that runs from Tuesday to March 31.

If you fail to sign up during that period, you'll be on the hook for your medical bills. Unless you're eligible for Medi-Cal, you wouldn't be able to buy insurance in the exchange until the next enrollment period comes around in fall 2014.

There are exceptions. People who experience a "qualifying event" that affects their insurance coverage, such as losing a job, will be allowed to buy coverage outside of the open enrollment period.

What are the penalties if I don't buy health insurance?

The federal health law requires most Americans to buy health insurance. If you don't, you'll be charged a penalty in 2014 of $95 or 1% of your household income, whichever is greater. The penalties go up after that.

Will I pay more for being a smoker or having cancer in the past?

Although the federal law allows insurers to charge smokers as much as 50% more than nonsmokers, California decided not to levy that surcharge. Smokers and nonsmokers are treated the same.

Everyone is guaranteed coverage regardless of their medical history under the law. Also, insurers can't charge people more based on their health.

What kind of income is counted in determining whether I qualify for premium subsidies?

Salary or income from a job or business counts when it comes to calculating whether you qualify for Medicaid or federal subsidies toward the purchase of private insurance.

Other sources of income, such as unemployment insurance, pensions, Social Security, alimony and rental proceeds, all count. Your assets, like a home, are not included in the calculation.

For many taxpayers, line 37 on their most recent IRS Form 1040 provides an idea of what will be used.

Does my employer have to offer me coverage now?

Most large employers already provide benefits. But starting in 2015, firms with 50 or more full-time workers will be required to provide health coverage to employees who work more than 30 hours a week, on average.

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