Beware of Limited Benefit Plans

Many people who are no longer eligible for Medicaid are enrolling in limited benefit plans that are not Affordable Care Act (ACA)-compliant. Most people – 4 out of 5 – qualify for free or low cost ACA health plans. Instead, they are paying higher premiums and getting less coverage. If you are losing Medicaid and need to find health coverage, don’t be pressured into buying a limited benefit plan.

What is a limited benefits plan?

A limited benefits plan is an insurance plan with less benefits than a full plan. It is intended to supplement your comprehensive health insurance, not to be your only health plan. Limited benefit plans usually do not provide the same level of coverage. Most:

Cover fewer types of medical services and expenses than a comprehensive policy
Do not cover pre-existing health conditions, which are health problems you have before the date your new health coverage starts
Pay flat fees for services, leaving you to pay the rest of the costs

Limited benefit plans can be called Short Term Limited Duration Insurance, Accident Policy, Cancer Only, Specific Disease or Heart Policies, Hospital Cash or Indemnity plans. They may also be called Discounted Plans such as Pharmacy, Dental or Medical Clinic Memberships.

Buying an ACA-compliant health plan

ACA-compliant plans cover essential benefits, including pre-existing health conditions. Here are some tips to help you enroll in an ACA-compliant plan and get all subsidies that you are eligible for to help make the plan more affordable.

Subsidies you may qualify for

You could be eligible for subsidies that lower the cost of an Affordable Care Act (ACA) health plan. There are two types of financial assistance available:

Premium tax credits help reduce your monthly premium
A cost sharing reduction, which lowers out-of-pocket costs when you receive healthcare services

Subsidies are based on your total household income.

⊕ Read our blog, Subsidies Help Lower Your ACA Health Plan Costs, to see if you can lower your ACA plan costs.

Health Needs

Think about your health needs and those of family members who will be covered before you look for a plan. Consider:

Pre-existing health conditions
Doctors you see and pharmacies you visit to make sure they are in the plan’s network
Medicines you take to see if they are covered and what tiers they are in:
- Each health plan splits drugs into groups, called tiers. The tier a drug is in depends on its type – generic, preferred brand, non-preferred brand, and specialty. The lower the tier, the lower the cost of the drug.

Other tips

Tell anyone helping you that you want an ACA-compliant plan. When you decide on a plan, ask again if it is ACA-compliant.
Ask for a copy of the policy before you agree to enroll. Ask a family member or trusted friend to review it with you to make sure it covers everything you expect it to.
Don’t be pressured to sign up, especially if they won’t share the policy with you. That is a good sign that something isn’t right.

Getting help to choose an ACA-compliant health plan

There are free resources to answer all your ACA enrollment questions, including subsidies you may qualify for. Remember, most people are eligible for a free or low-cost ACA health plan. You could call the Federal Marketplace or a health navigator. You can also call an experienced agent. But not all agents are the same.

Captive agents work for one insurance company, so they sell plans offered by that insurer only. Independent agents work with several insurers, so they can compare many plans from different companies. American Exchange is an independent agent, so we can compare all insurance plans offered in your area. We are also available to answer your insurance-related questions all year long.

American Exchange Can Help You Enroll in an ACA Plan

To see if you qualify for a free or low-cost plan, call American Exchange. Our licensed, independent health insurance benefits experts will listen to your needs, then compare all ACA-compliant plans available in your area. We will help you find the best plan for your budget, health, and lifestyle at no cost or obligation to you. And we are available year-round to answer your insurance-related questions. Contact us today.

Call: 1.888.995.1674 Email: enroll@americanexchange.com

Visit Our ACA Insurance Webpage

ACA Health Plan Resources

We publish a blog covering important ACA marketplace topics the second Tuesday of each month, and more often during Open Enrollment, which begins November 1 each year. We also create handouts to address common topics impacting ACA enrollees. Click on the link below to read or download:

American Exchange is a licensed health insurance broker. Robert Huffaker, NPN 13568432

Photo courtesy of iStock

Beware of Limited Benefit Plans