Health insurance can feel overwhelming, especially when you're not sure what you qualify for or where to start. If you've heard about the Affordable Care Act — often called the ACA or "Obamacare" — but aren't quite sure what it means for you, you're not alone. This guide breaks it down in plain English so you can make a more informed decision about your coverage options.
The Affordable Care Act (ACA) is a federal law that created the Health Insurance Marketplace — a place where individuals, families, and small businesses can shop for health insurance plans. It also set minimum standards for what health plans must cover, which means every plan sold on the Marketplace is required to include things like emergency services, prescription drugs, preventive care, and mental health coverage.
The ACA also made it illegal for insurers to deny you coverage or charge you more because of a pre-existing condition. If you were previously uninsured because of a health history, this is one of the most important protections available to you.
Availability of specific plans and costs will vary depending on your state, household income, and the insurance carriers operating in your area.
The Marketplace is where you go to compare and purchase ACA-compliant health plans. Plans are divided into four metal tiers — Bronze, Silver, Gold, and Platinum — which reflect the balance between your monthly premium and the amount you pay out of pocket when you use care.
Open Enrollment typically runs from November 1 through January 15 each year, though you may qualify for a Special Enrollment Period if you've had a qualifying life event like losing job-based coverage, getting married, or having a baby.
One of the most significant aspects of the ACA is that many people qualify for financial assistance to help cover the cost of their premiums. This comes in the form of Premium Tax Credits, which are based on your household income and the number of people in your family.
You don't have to wait until tax season to benefit — you can apply the credit directly to your monthly premium, which lowers what you pay each month. Some people also qualify for cost-sharing reductions, which lower the amount you pay for deductibles, copays, and coinsurance when you use your plan.
Eligibility and the amount of assistance you may receive depend on your income, household size, and other factors. We encourage you to check your eligibility through HealthCare.gov or speak with a licensed insurance agent or navigator in your state.
Depending on your income and state, you may qualify for Medicaid rather than a Marketplace plan. Medicaid is a government program that provides free or low-cost health coverage to eligible low-income adults, children, pregnant women, elderly adults, and people with disabilities.
The Children's Health Insurance Program (CHIP) covers children in families that earn too much to qualify for Medicaid but may struggle to afford private coverage. Eligibility rules for both programs vary significantly by state. The Marketplace application process will automatically screen you for these programs when you apply.
Every health plan sold through the Marketplace must cover a set of essential health benefits, including outpatient care, emergency services, hospitalization, maternity and newborn care, mental health and substance use disorder services, prescription drugs, rehabilitative services, laboratory services, preventive care, and pediatric services including dental and vision for children.
While these are the minimum requirements, specific plan benefits, networks, and costs vary. Always review a plan's Summary of Benefits and Coverage before enrolling.
Choosing the right health plan is about more than just the monthly premium. Before enrolling, it's worth thinking about your doctors and hospitals (check whether your current providers are in-network), your prescriptions (review the plan's drug formulary), how often you use healthcare, and your total annual costs — deductible, copays, coinsurance, and out-of-pocket maximum, not just the monthly premium.
Can I be turned down for a Marketplace plan because of a health condition?
No. Under the ACA, insurance companies cannot deny you coverage or charge you more because of a pre-existing condition.
When can I enroll in an ACA plan?
Open Enrollment typically runs from November 1 to January 15. Outside of that window, you may qualify for a Special Enrollment Period if you experience a qualifying life event — such as losing your current coverage, moving, or having a child.
What if I miss Open Enrollment?
If you don't have a qualifying life event, you may need to wait until the next Open Enrollment period. However, Medicaid and CHIP enrollment is available year-round if you qualify.
How do I know if I qualify for financial help?
Financial assistance is based on your estimated household income for the coverage year relative to the Federal Poverty Level. You can check your eligibility at HealthCare.gov or through your state's Marketplace website.
Is it required by law to have health insurance?
The federal individual mandate penalty was reduced to $0 starting in 2019, so there is currently no federal penalty for not having coverage. However, some states have their own requirements — check the rules in your state.
What's the difference between a deductible and an out-of-pocket maximum?
Your deductible is the amount you pay for covered services before your insurance begins to share costs. Your out-of-pocket maximum is the most you'll have to pay in a plan year — after that, your insurance covers 100% of covered costs for the rest of the year.
Health coverage is one of the most important financial decisions you can make for yourself and your family. Compare your options before Open Enrollment closes.
Visit HealthCare.gov →Availability of plans and financial assistance depends on your state, income, and household size.