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My Employer-Based Coverage Is Too Expensive. What Are My Options?

If you have coverage through your employer, you are typically considered covered and won’t be facing the tax penalty for uninsured individuals. There are some cases, however, where the coverage offered through your employer may seem too expensive, leading you to consider your options.

You might be able to switch over to a plan offered through your state’s health insurance exchange, but it’s possible that you will not quality for lower costs as a result of your income. Of course, this depends on the cost and the type of insurance that your employer provides. Since open enrollment for 2013 has already concluded, you can only get health coverage for this year if you qualify for a special enrollment period. Otherwise, you will need to wait until the new open enrollment opens up in November.

There are some factors you need to account for when determining if you want to select a plan from the health insurance exchange.In a job-based health plan, your employer is likely to cover part of your premium cost as a benefit for you working there. If you go for a plan from the health insurance exchange, you will not have any support from an employer for those premiums. You also may not qualify for lower costs on your monthly premiums and costs out of pocket, even if otherwise your income might quality you for it. If your job coverage is considered affordable and meets the minimum value required by the Affordable Care Act, you will not qualify for lower costs. If you have questions about the plan offered at your company meeting minimum value, your employer can inform you.

Job based plans are considered affordable if the share of premiums for the lowest cost coverage is less than 9.5 percent of the family income. The important thing to note is that this is only for the individual cost of care, not for your entire family to be covered. It is likely that you could pay more than 9.5 percent of the income for premiums if you are covering your entire family, but the minimum value standard is only based on the individual cost of a healthcare plan. A plan also meets the minimum value standards if it covers 60 percent of the covered medical costs while the person getting the coverage pays 40 percent of the costs.