Employers covered 73% of the average $22,221 in annual premiums for health insurance for a family of four in 2021, but the employee was still responsible for the remaining $5,969 in costs. Expenses for those who are independently insured can be extremely high.
It seems sense that so many People rely on financial aid of some kind to cover their health care expenses. Medicaid covered 82.3 million individuals as of June 2022. Meanwhile, according to the Kaiser Family Foundation, nearly 9.1 million people received financial aid for Marketplace health plans in 2020.
Knowing what kinds of financial aid are available to help pay premiums and reduce out-of-pocket expenses is crucial because health insurance is expensive but also necessary.
KEY LESSONS
• The ACA Health Insurance Marketplace maintains a search engine to assist consumers in finding available premium savings programs depending on their state and income level.
People who purchase their own private health insurance may be eligible for a premium tax credit or cost-sharing reductions. There are special health insurance coverage protections for Alaska Natives and American Indians.
What Sort of Financial Assistance Is Offered?
Becoming insured is now more inexpensive than ever thanks to the Affordable Care Act (ACA), especially for those with pre-existing diseases. For people and families looking to lower the cost of health insurance, Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), tax credits, and cost-sharing resources come together to provide a network of support. Location, age, income, and family size all play a role in program eligibility.
Medicare
Those 65 and older, some younger persons with impairments, and those with End-Stage Renal Disease or ALS are all covered by the federal health insurance program known as Medicare.
There are four components to Medicare:
Hospital stays, nursing home stays, and in-home care for the housebound are all covered by Part A (hospital insurance). Anybody who has accumulated 40 Social Security credits, or roughly 99% of claimants, is eligible for free Part A. and compare it to the reality.
• Part B is an optional medical insurance plan with a standard monthly cost of $164.90 and an annual deductible of $226 in 2023. Individuals with incomes over $97,000 and couples with incomes over $194,000 will pay a higher monthly premium.
• Part C, often known as Medicare Advantage, is private insurers’ offering of Medicare Parts A and B coverage. Each plan has different premiums, deductibles, and copayments.
Prescription medications are covered by Part D. Monthly premiums vary depending on the plan and the beneficiary’s income, but deductibles are set at $505 in 2023.
Last but not least, Medicare Supplement Insurance (Medigap) helps pay for some Part A and B treatments and may offer additional advantages, such as foreign coverage, although it has its own premiums that vary by plan and individual circumstances.
Unless they sign up for a Medigap K or L plan, an Original Medicare beneficiary’s annual out-of-pocket expenses are not restricted.
Many aid programs are available to help, despite the fact that Medicare coverage might be expensive. Medicare Savings Plans are income and resource-restricted programs that assist in paying Parts A and B premiums, as well as deductibles, copayments, and coinsurance in some cases. These programs are run by state medical assistance (Medicaid) offices, although they are not the same as Medicaid. Get in touch with the medical aid office in your state to apply.
For those with particular medical need, assistance programs are also available. For instance, Medicare Special Needs Plans reduce costs for people who require long-term care (at home or in a facility) or have a chronic condition like dementia, cancer, or diabetes. The Program of All-Inclusive Care for the Elderly (PACE) assists people over 55 in getting care outside of a nursing home.
Certain people automatically qualify for Extra Help, a program that assists those with low incomes in covering the price of Medicare Part D coverage. Individuals who do not automatically qualified may still apply. Also, some pharmaceutical firms provide extra support to aid people with Part D prescription medicines.
Medicaid
Medicaid is a state program that helps low-income persons of all ages with medical bills. It is run in compliance with federal regulations. Medicaid is administered by states, so eligibility and costs vary greatly. However, federal regulations require coverage for children and pregnant women in low-income families, seniors and people with disabilities who receive Social Security Insurance, certain caregivers, and adults with very low incomes. The Affordable Care Act’s increase of eligibility to all people with incomes up to 138% of the federal poverty line has, however, been accepted by the majority of states.
While some Medicaid recipients may be required to pay premiums and out-of-pocket expenses, the beneficiary may still save a lot of money. For certain people, these advantages can reduce the price of prescription medications to just $8.00 and the cost of a doctor visit to just $4.00.
CHILDREN’S HEALTH INSURANCE PROGRAM (CHIP)
For kids in families who make too much money to be eligible for Medicaid, the Children’s Health Insurance Program (CHIP) offers health coverage. Like Medicaid, CHIP is administered by states in accordance with federal regulations; some states run distinct CHIP programs, while others incorporate it into Medicaid. State-specific requirements vary, but CHIP offers children and teenagers free or inexpensive dental and medical insurance. A crucial tool for determining eligibility and locating nearby providers is InsureKidsNow.com.
Children up to the age of 19 are eligible for CHIP coverage.
Premium Tax Credits
The premium tax credit (PTC), a refundable credit, assists in defraying the cost of health insurance premiums obtained through state or federal Health Insurance Marketplaces. Prior to 2021, households with incomes more than 400% of the federal poverty line were ineligible for the premium tax credit; however, this restriction has been delayed until 2025.
The Marketplace generates a tax credit estimate on your behalf when you apply for coverage. You can choose to send regular payments to your insurance as an advance credit or claim the credit in full when you file your taxes. If you opt for the latter, you must reconcile your estimated and actual credit on Form 8962 when you submit your taxes in April.
Because of this, it’s critical to inform the Marketplace of any changes in your circumstances that may alter the size of your credit and cause a higher-than-anticipated tax bill, including as changes in your income, family size, or eligibility for non-ACA coverage.
Cost-Sharing Savings
On private health insurance acquired through the Marketplace, cost-sharing reductions, sometimes known as “additional savings,” cut deductibles, coinsurance, and copayments. Similar to the premium tax credit, the Marketplace will automatically determine your eligibility for cost-sharing reductions when you apply. But, you must sign up for a Silver health plan in order to be eligible for savings.
Shareholders of an Alaska Native Claims Settlement Act (ANCSA) Corporation or members of American Indian tribes with federal recognition may be eligible for further cost-sharing reductions.
How to Get Financial Assistance
Medicaid, some Medicare programs, and other public assistance programs have different eligibility requirements from state to state. To learn more, contact the Medicaid office in your state. You can reach a live person via live chat or phone, 24 hours a day, 7 days a week, for more Medicare assistance or questions.
Think twice before rejecting or canceling your job-based insurance in favor of a Marketplace plan. Even if your salary would ordinarily make you eligible, if an employment-based plan is “affordable” and meets the minimal value criterion, you will not be eligible for Marketplace discounts.
The websites of each hospital or clinic list their financial aid initiatives. Many of them offer applications in languages including Spanish, Arabic, Mandarin, and others that are widely used.
Health Insurance Application Process Financial Assistance
The Marketplace is where most applications for financial aid for health insurance are made. The federal website will refer consumers to those marketplaces when necessary, despite the fact that some states operate their own marketplaces. Medicare recipients in need of assistance should get in touch with the Medicaid office in their state.
You might need to submit supporting evidence, such as proof of your citizenship, social security number, household income, and American Indian or Alaska Native status, in order to qualify for help.
Even if you have health insurance, you may still be at danger of accruing medical debt. To help with unforeseenly high costs, several hospitals provide financial aid or charitable care programs. Several hospitals use charity care forms to determine whether a patient is eligible for one or more of the government programs mentioned above, and others, like Ohio Health, offer interest-free loans to patients who do not meet the requirements for other discounts.
Conclusion
Many Americans are awake at night due to the soaring cost of health care in the country. However, millions of Americans have access to affordable insurance through federal and state programs like Medicare, Medicaid, and CHIP, and the Affordable Care Act included a number of insurance subsidies and cost-cutting initiatives like the premium tax credit. Charity care programs can assist both uninsured patients and those whose insurance does not fully cover the cost of care for those who are surprised with a larger medical bill than they anticipated.