Navigator Guide FAQ of the Week: Who is Eligible for Marketplace Coverage?

Open Enrollment began on November 1, and will continue through January 15 in most states. With support from the Robert Wood Johnson Foundation, CHIR updated its Navigator Resource Guide, a practical, hands-on resource with over 300 searchable frequently asked questions (FAQs) on topics such marketplace eligibility, premium and cost-sharing assistance, and post-enrollment issues for individuals. It also reflects policy changes for the 2023 plan year, including the fix to the family glitch.

Throughout Open Enrollment, we will highlight FAQs that are likely to be top of mind for consumers and the assisters helping them apply for and enroll in coverage. This week, we are focusing on who is eligible for marketplace plans.

Who can buy coverage in the marketplace?

Most people can shop for coverage in the marketplace. To be eligible you must live in the state where your marketplace is, you must be a citizen of the U.S. or be lawfully present in the U.S., and you must not currently be incarcerated.

Not everybody who is eligible to purchase coverage in the marketplace will be eligible for subsidies, however. To qualify for subsidies people must not be eligible for certain other types of coverage, such as Medicare, Medicaid, or an affordable employer plan. (45 C.F.R. § 155.305; 26 U.S.C. § 36B (c)).

If I buy an individual health plan outside the health insurance marketplace, is my coverage going to be the same as it would be inside the marketplace?

Not necessarily. There are some health plans sold outside the health insurance marketplace that are required to provide the same basic set of benefits as plans sold inside the marketplace, are not allowed to exclude coverage of a pre-existing condition, and are also required to provide a minimum level of financial protection to their consumers. Specifically, these plans must cover at least 60 percent of what the average person would spend on covered benefits and there is a cap on the maximum amount you will pay out of pocket ($9,100 for an individual and $18,200 for a family in 2023).

However, it is important to note that you may only obtain premium tax credits and cost-sharing reductions if you purchase a plan through the health insurance marketplace. There is no income limit on eligibility for premium tax credits, so most people will do better to buy coverage through the health insurance marketplace.

While plans sold through the health insurance marketplace must be certified by the marketplace as meeting minimum coverage and quality standards, plans sold outside the marketplace need not be certified.

Contact your state’s Department of Insurance for a list of reputable brokers who can direct you to these plans, which are sold outside the marketplace, but are still required to provide the same protections as plans sold inside the marketplace.

If you decide to forgo health insurance marketplace coverage and premium tax credits, there may be other coverage options available outside of the marketplace that are not required to provide the Affordable Care Act’s protections. These include plans that are not traditional health insurance products, including short-term, limited duration insurance, association health plans, health care sharing ministries, and farm bureau plans. If an insurer or entity cannot provide a Summary of Benefits and Coverage that indicates the coverage is minimum essential coverage, be aware that the plan may have coverage limitations, particularly for pre-existing health conditions or for basic medical care. (45 C.F.R. § 147; 26 U.S.C. § 36B; 45 C.F.R. § 156.130; CCIIO, Premium Adjustment Percentage, Maximum Annual Limitation on Cost Sharing, Reduced Maximum Annual Limitation on Cost Sharing, and Required Contribution Percentage for the 2023 Benefit Year).

Can I be charged more if I have a pre-existing condition?

Not if you’re buying a marketplace plan subject to the Affordable Care Act. These plans are not allowed to charge you more based on your health status or pre-existing condition. Outside the marketplace, not all plans offer the same protection. (45 C.F.R. § 147.108).

Look out for more weekly FAQs from our new and improved Navigator Guide, which can be accessed here.