When former President Obama introduced the Affordable Health Act (ACA), he completely changed the way health insurance was sold and administered in the United States. The ACA brought health insurance to millions who didn’t have it before while making it easier for people with pre-existing conditions to get the coverage they needed.
Not only did Obama create a whole new way for people to get health insurance, but he also made sweeping changes to Medicare. The introduction of the ACA even inspired insurance carriers in the marketplace to utilize automatic Medicare enrollment that allowed carriers to put their clients into a special Medicare program when they turned 65 years old if they were already enrolled in a private plan.
Automatic enrollment might sound convenient, but it’s not necessarily a good thing, especially if you’re not aware of what’s happening. While the Affordable Care Act changed the healthcare system, including Medicare, it did not combine everything into one neat package. Medicare is a separate program with separate enrollment deadlines and regulations. You can use the marketplace to sign up for private, individual coverage – unless you’re trying to sign up for Medicare. You cannot buy Medicare coverage, even Advantage plans, on the federal or state marketplaces.
How Do I Buy a Marketplace Insurance Plan?
Federal and state marketplaces were created to make buying private health insurance plans easier. Most people with health insurance get coverage through their jobs, but that’s not an option for everyone. Obamacare opened up access to major medical coverage outside of your employer.
Each marketplace exchange offers different levels of health insurance through a variety of insurance providers. You’re presented with all of the options available for your state, and then you choose which plan you want to buy. After you make your purchase, you’ll be given additional information relevant to your plan, such as how to file a claim and when your coverage will start.
The marketplace has definitely organized how insurance is sold, and it can be a very convenient tool for anyone who wants to buy their own health insurance. But there are pros and cons to signing up at HealthCare.gov or your state’s exchange website, and you don’t have to purchase a plan on the marketplace. You can also buy health insurance through a third-party broker or via an insurer directly. Sites like this one offer many of the same benefits as signing up through a government portal.
In any case, you can only buy major medical coverage (also known as ACA-compliant coverage) during open enrollment each year. For 2017, that ended on January 31. Unless you qualify for a special enrollment period, you can’t sign up outside this window. Medicare enrollees follow different rules for signing up, including separate enrollment periods.
How Do I Buy a Medicare Plan?
As great as the insurance marketplace is, you cannot use it to buy Medicare. The Medicare program is administered by the federal government through a network of certified insurance carriers. It’s important to note that you do not need to buy your Medicare coverage from the same company that held your marketplace coverage.
For most people, Medicare eligibility is based on age. You can sign up during a window that starts three months before the month you turn 65 and lasts for three months following your birthday month, for a total of seven months. During your initial eligibility window, you can sign up for traditional Medicare or Medicare Advantage, enroll in supplemental coverage, choose a drug plan and start enjoying the benefits of low-cost health insurance. Under the Affordable Care Act, having Medicare Part A is enough to meet the law’s requirements for minimum essential coverage. Since Medicare Advantage combines Parts A and B with other elements, Medicare Advantage would also protect you under the law.
You can sign up for Medicare online, via phone or by visiting your local Social Security office in person. Medicare Advantage plans are sold through private insurers, and you can learn more about your options with our overview of Medicare Advantage.
Other Things to Consider
It’s illegal for any company to attempt to sell you marketplace insurance when they know you have Medicare. That’s why you’ll get asked up front whether you have Medicare. The marketplace can’t help you if you need Medicare coverage. However, Medicare enrollment – and dis-enrollment – isn’t automatic for most people. If you already have marketplace coverage and hit your eligibility window for Medicare, you’ll need to:
- Decide whether you want to keep your plan or sign up for Medicare.
- Enroll in original Medicare or Medicare Advantage as soon as possible.
- Cancel your marketplace plan as soon as your Medicare Part A coverage takes effect.
The moment your Part A coverage is initiated, you’re no longer eligible for the tax credits that helped you to pay your marketplace insurance premiums. If you forget to cancel your marketplace insurance, you would be paying full price for insurance you won’t be using. And in many cases, you can’t keep marketplace coverage if you have Medicare anyway.
If you have health insurance through your employer, you’ll need to take some additional steps. Some companies automatically enroll Medicare-eligible workers into the company’s Medicare Advantage plan, a feature that isn’t always discussed with the beneficiary. Before you reach your eligibility window, say a couple months beforehand, talk with your company’s health administrator or HR department to see if you’ll be enrolled directly with an MA plan.
If you like the features of the plan, then you can allow the automatic enrollment. But if the plan isn’t for you, then speaking with someone ahead of time gives you a chance to shop around for something better before enrollment starts.