Individual Health Insurance
Frequently Asked Questions

Individual insurance refers to any health insurance policy that is paid for directly by an individual (versus an employer or the government) to purchase personal or family coverage.

ACA or Obamacare qualified insurance plans, what MLJ offers as permanent insurance, is available either directly from insurance companies or through Connect for Health Colorado. (*Obamacare insurance only refers to plans sold and purchased through the Exchange)

These plans must meet certain criteria, some of which are:

  • Guarantee issue means no applicant can be denied coverage due to their medical history.
  • Essential Health Benefits means that the health plan must include certain benefits and those benefits must be included in the plan whether a specific individual requires the benefits or not. They include but are not limited to: Maximum deductible and out of pocket costs; prescription coverage; hospitalization coverage; maternity coverage, unlimited autistic coverage, chiropractic care; pediatric dental and vision.
  • Metallic level designations means that all plans must meet a certain actuarial value set by the Federal government. The levels are Bronze, Silver, Gold and Platinum. The value of the metal, poorer to richer, represents the ‘richer’ the plan or the more of the medical expenses the insurer must cover.
  • No Lifetime Maximum means that when a person has accessed care there is no limit to the amount of covered approved medical expenses.
Open-Enrollment is the period from November 1st to January 31st, during which anyone can apply for insurance, pay their binder payment and receive a policy. The remainder of the year one can apply when experiencing a Qualifying Life Change Event. (For more information, see the question below, “How do I apply for Individual Insurance outside of open enrollment?“)

The deadlines for 2017 Open Enrollment are as follows:

  • November 1, 2016 to December 15, 2016 policy start date will be January 1, 2017
  • December 16, 2016 to January 15, 2017 policy start date will be February 1, 2017
  • January 16, 2017 to January 31, 2017 policy start date will be March 1, 2017
The insurance company must file the next year’s plans by March or April of the current year. They may use current plan’s medical cost payout to prove the amount of money spent on healthcare costs. This is used to determine the amount of increase that the Division of Insurance (DOI) will allow.

No rate increases or decreases are allowed by the Division of Insurance (DOI) without substantial supporting proof being provided by the insurance company. The risk factors of increased age of population, increases in health care (new drugs, new treatments), and cost of the contracts for providers are also allowed to be included in the rate filings.

(*Insurance companies set the premiums wherever they want to make profit.)

The Division of Insurance (DOI) reviews health insurance premiums to make sure they are neither too high nor too low, and makes sure that the plans meet state and federal regulations. The DOI does not have the regulatory authority to set the insurance premiums.
Premiums reflect the costs of healthcare — what doctors and hospitals and other providers charge for medical services.

However, the Division of Insurance does not regulate doctors, hospitals or other healthcare providers and their associated healthcare costs.

Many people may qualify for new federal financial assistance, based on income, which will reduce the cost of insurance premiums and out-of-pocket expenses, only available through Connect for Health Colorado.

Federal tax credits are known as Advance Premium Tax Credits (APTC) and Premium Tax Credits (PTC), and can help make premiums more affordable. Eligibility for the APTC depends on a consumer’s household income in relation to the federal poverty level.  The tax credit itself is calculated based on income, age, and the cost of insurance in a community. Financial assistance from the Federal Government is only available for policies purchased through the Exchange or Connect for Health Colorado.

A person who currently receives a tax credit for their 2016 insurance, and who will enroll in the same plan for 2017, may see an average decrease of 11% for their subsidized premium, despite actual premium increases for plans.

Contact us to request our How to Guide that explains how to consider assistance options and how to apply for that assistance.

*Please see the question below for more information about the difference between the APTC and PTC tax credits.

The Advance Premium Tax Credits (APTC) is the monthly amount of subsidy determined based on one year of income. For example, the monthly subsidy for 2017 is based on the amount of income the applicant expects to receive in 2017 when applying for financial assistance.

To be eligible for the APTC credit, you must receive a denial for Medicaid. The credit is sent directly to the Insurance Company, and the insured will receive an annual statement for filing their taxes.

The Premium Tax Credits (PTC) is the credit reflected on that year’s tax return calculated from annual income and the money paid that year in health insurance premiums. For example, if you paid $12,000 in premiums in 2017 when your current income level indicates that you should have paid less, you can elect to receive the difference as a PTC credit.

For the PTC credit, the insured is required to pay the entire premium each month and will receive an annual statement for filing their taxes. The tax credit at the end of the year may increase the refund amount or lower tax liability.

The APTC is also adjusted when filing your tax return for 2017. For example, if a person received $2,400 in subsidy based on their estimated income for 2017 but their income actually dictated that they only receive $1,000 in assistance, they will be required to pay some of that surplus subsidy back to the Federal government in the form of tax. APTC and other federal financial assistance are only available for plans purchased through the state’s health insurance exchange, Connect for Health Colorado.

*Note: The decision to elect either APTC or PTC is up to you. However, we recommend that those with a set, stable income elect APTC, while those with a variable income elect PTC.

Shopping for an appropriate plan is crucial. Current clients can often reduce their rate increase by consulting MLJ’s sales associates to evaluate their needs and options for each year.

It’s important to look at more than just premiums when shopping for insurance.  Consumers should consider the following as they work to make an informed decision about a health plan:

  • Find out if a doctor or preferred hospital is in the plan’s provider network.  Seeing an out-of-network doctor will be more expensive, but if done on a limited basis and in coordination with an in-network doctor, it may allow you to enroll in a lower cost plan for the year. MLJ provides a free look-up tool to help with your search.
  • Always look at the deductible amounts and out-of-pocket maximums in the plan you are considering. The tradeoff for lower premiums will likely be higher deductibles and out-of-pocket costs. Understand what will be paid for a doctor’s visit and other co-pay or coinsurance amounts. Premiums and other out-of-pocket expenses, including deductibles, copays, and co-insurance, can quickly add up to thousands of dollars every year. Health care plans limit these out-of-pocket costs. For 2017, insurance policies are written so that insureds not required to pay more than approximately $7,150 per year and $13,300 for covered medical expenses for a family. Once the out-of-pocket maximum is met, the insurance company covers all approved costs for the remainder of the calendar year.
  • Closely review the network and pharmaceutical formulary (approved drug list) when selecting a plan and refer to it every time before seeking treatment.
There are limited options for applying for health insurance outside of the Open Enrollment Period. When a person experiences a Qualifying Life Event (QLE), a window of opportunity is opened. Some examples of QLEs are:

  • Involuntary loss of coverage, such as loss of employment where an insured had participated in an employer-sponsored health insurance policy
  • Birth
  • Death
  • Divorce
  • Court-ordered support
  • Relocation, such as moving from one state to another
  • Exhaustion of COBRA. (When an employer pays a few months of COBRA as a part of a severance package, the termination of their payment is not a QLE, and the applicant must wait until next Open Enrollment or when the COBRA period expires.)

A person who has a valid QLE has 30 days prior (with most application methods) and 60 days after to apply. This period is known as Special Enrollment Period (SEP). The start date of the insurance policy applied for will be determined by the type of QLE and the timeline of the submission of the actual application. SEP applications must be submitted within the required timeframe and be accompanied with the supporting documentation discussed below.

Please know that the insurance companies can require documentation to support the QLE declaration. MLJ works to diligently to make sure that all applications made through our office meet the criteria to be a valid application. Due to the fact that the documentation required varies by insurance company, event and circumstances, we recommend a consultation with our Individual Sales Specialist to determine the required timeline and documentation.