Health Insurance Marketplace

AG (Aktiengesellschaft)

What is the health insurance market

The health insurance market is a platform that offers insurance plans to individuals, families or small businesses. The Affordable Care Act of 2020 established the market as a means of achieving maximum compliance with the mandate that all Americans carry some form of health insurance. Many states offer their own markets, while the federal government runs an open exchange for residents of other states.

BREAKDOWN OF THE HEALTH INSURANCE MARKET

The health insurance market is a key part of the Affordable Care Act (ACA) passed by the US Congress in 2020. The law asked states to create their own exchanges where individuals or families without coverage sponsored by the employer could compare the plans. Many states, however, chose not to establish a market and thus joined the federal stock exchange. The market facilitates competition between private insurers in a central location where people who do not have access to employer sponsored insurance could find an appropriate plan. Individuals must comply with the mandate that all Americans carry health insurance; the market guarantees everyone access to a plan.

Individuals can compare and apply plans via the market during the open registration period. Typically, this period takes place in November and December of the year preceding the year in which coverage takes effect. Consumers can request a special membership period in the event of a qualifying event such as the birth of a child, marriage or the loss of another insurance plan.

The market categorizes the plans into four levels: bronze, silver, gold and platinum, in order from least to largest. The highest level, platinum, includes plans that cover about 90% of healthcare expenses, but the costs are commensurate with this level of coverage.

The 10 essential advantages of the health insurance market

While the plans that insurers offer in the market can vary widely, the ACA requires that they must each meet 10 basic requirements or Essential Health Benefits (EHB). Many EHB may seem self-evident, but plans can skimp on basic coverage and some political opponents of ACA have proposed eliminating EHB since the passage of ACA. The benefits required include ambulatory care, hospitalization, rehabilitation services and preventive care. Neonatal, pediatric and maternity care also fall within this framework. ACA does not require large employer-sponsored insurance plans to cover these EHBs. Instead, the drafters of the law believed that the market would exert competitive pressure that would force employers to comply with these basic mandates.

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