insurance

Buying insurance after health care reform

To defray cost increases, tax credits will phase in to limit the amount of income that you'll have to dedicate to premiums, depending on how much you earn. For instance, a family of four with an annual income of $44,100 will pay $2,778 per year, or $231 per month, in premiums to purchase a policy that covers 70 percent of their medical costs. The federal government will pay the remaining costs.

What coverage you'll get

Now: Policies vary widely. Unless you live in a state with strict health insurance regulations, there is no minimum standard for health insurance coverage. What you'll pay out of pocket depends to a large degree on which policy you choose, your medical history and how much you're willing to pay in premiums.

After health care reform: Policies will have much more transparent terms, broader coverage and no annual or lifetime limits. Insurers also won't be allowed to drop customers through rescission, the practice of canceling coverage based on unintentional mistakes in a policyholder's application, says Collins. Having coverage also will allow you to avoid rising tax penalties imposed on those who don't carry coverage.

If you get health insurance through an employer ...

Shopping

Now: You can choose from a limited range of plans available through your employer's human resources department.

After health care reform: You'll still be limited to the types of plans offered by your employer as long as they meet the same standard minimum of coverage required by the exchanges, Collins says. The number of employers with more than 50 workers to offer health insurance will likely increase, since employers whose employees receive tax credits to buy insurance on exchanges will be fined in most circumstances, says Collins.

Applying

Now: The application process varies by employer, but typically you have to opt in to a company's health insurance plan to get coverage by filling out forms and agreeing to pay premiums charged by the company plan over and above what your employer pays.

After health care reform: As with private health insurance, applying for coverage from an employer will no longer require answering questions about your medical history. If you work for an employer with less than 200 employees, you'll still have to opt in. If your employer has more than 200, you'll automatically opt in to a company plan.

Prices

Now: Employers ask employees to pay varying amounts to help cover their health insurance, but it's usually much less than what someone shopping for health insurance on the individual market would pay.

After health care reform: Any increase in premiums caused by the law should be negligible for most workers, according to the CBO report.

What you'll get

Now: You're probably part of a plan that's more comprehensive than those purchased on the individual market, but it may have hidden limitations that you may not become aware of until a claim is denied, says Collins.

After health care reform: If your employer is offering plans with lots of limitations, you'll probably end up with higher-quality plans after the law goes into effect, thanks to health care reform's minimum benefit levels. However, not much will change if your employer-sponsored health insurance meets minimum standards, says Collins. In addition to your normal benefits, you'll also avoid the escalating IRS penalty that will come with being uninsured.

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