Paul Sanchez
The Health Insurance Marketplace is a federal service that helps people shop for and enroll in health insurance. It is operated by the federal government and is available at HealthCare.gov for most states, although some states run their own marketplaces. The Health Insurance Marketplace provides health plan shopping and enrollment services through websites, call centers, and in-person help. Individuals and families can apply for coverage through the Marketplace, and small businesses can use the Small Business Health Options Program (SHOP) Marketplace to provide health insurance for their employees. The Marketplace offers a range of plans to choose from, including coverage for medical, dental, and vision care.
| Characteristics | Values |
|---|---|
| Definition | A service that helps people shop for and enroll in health insurance |
| Operator | The federal government |
| Website | HealthCare.gov |
| Availability | Available in most states; some states run their own marketplaces |
| Enrollment services | Provided through websites, call centers, and in-person assistance |
| Small business option | Small Business Health Options Program (SHOP) Marketplace |
| Eligibility requirements | Must live in the US, be a US citizen or national (or lawfully present), and not be incarcerated |
| Enrollment periods | Yearly Open Enrollment Period with special enrollment periods for life events or low income |
| Enrollment information | Income, household information, and health details |
| Benefits | Premium tax credits, cost-sharing reductions, coverage through Medicaid and Children's Health Insurance Program (CHIP) |
| Coverage | Medical, dental, and vision |
| Payment | Monthly premiums paid directly to the insurance company |
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What You'll Learn
Eligibility requirements
Residency and Citizenship
To be eligible for Marketplace coverage, individuals must be residents of the United States for tax purposes. This includes US citizens and nationals, as well as those lawfully present in the country. Non-citizen nationals are typically those born in American Samoa or born abroad with at least one American Samoan parent. Individuals living in US territories cannot get Marketplace coverage unless they also qualify as residents of one of the 50 states or Washington, DC.
Incarceration Status
Individuals who are currently incarcerated do not qualify for Marketplace health coverage.
Income Level
Eligibility for premium tax credits and cost-sharing reductions is based on household income. The Health Insurance Marketplace Calculator helps individuals determine eligibility by allowing them to enter their household income as a dollar amount or as a percentage of the Federal poverty level. Eligibility for Medicaid, a free health insurance program, is also based on income level, with most healthcare services covered at little to no cost.
Age
Individuals who are 65 years or older are typically eligible for Medicare, a federal health insurance program. Certain younger people with disabilities may also qualify for Medicare. If an individual is eligible for Medicare, they cannot purchase Marketplace coverage, even if they choose not to enroll in Medicare. However, those over 65 who are not eligible for Medicare due to immigration status or work history may be eligible for Marketplace coverage and subsidies.
Life Events
Individuals who have experienced certain life events, such as losing health coverage, moving, getting married, having a baby, or adopting a child, may qualify for a Special Enrollment Period outside of the yearly Open Enrollment Period. Additionally, households with incomes below a certain amount may qualify for immediate coverage through Medicaid or the Children's Health Insurance Program (CHIP).
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Enrollment periods
Federal marketplace insurance, also known as the Health Insurance Marketplace, is a federal health insurance program for people 65 and older and certain younger people with disabilities. It also covers people with End-Stage Renal Disease (ESRD) or permanent kidney failure requiring dialysis or a transplant. The program provides free or low-cost health coverage to some low-income people, families, children, pregnant women, the elderly, and people with disabilities.
The Health Insurance Marketplace has an annual Open Enrollment Period, which usually runs from November 1 to January 15. Consumers who enroll by December 15 can avail of full-year coverage that starts on January 1 of the following year. Those who enroll after December 15 but before the January deadline will have their coverage start on February 1. Notices are sent to currently enrolled consumers before November 1 to inform them of the upcoming Open Enrollment Period.
Outside of the yearly Open Enrollment Period, there is a Special Enrollment Period, which allows eligible individuals to purchase health care insurance through the Marketplace. This period is triggered by certain life events, including losing health coverage, moving, getting married, having a baby, or adopting a child. Income is also a factor, as those whose household income falls below a certain amount may qualify for the Special Enrollment Period.
During the Special Enrollment Period, consumers may qualify for premium tax credits and cost-sharing reductions to lower their Marketplace health insurance costs. These cost-sharing reductions are often referred to as "extra savings" and require enrollees to opt for a plan in the Silver category.
Additionally, the Small Business Health Options Program Marketplace (SHOP) is available for small businesses to provide health coverage to their employees. Unlike the Health Insurance Marketplace, SHOP does not have a restricted enrollment period, allowing businesses to offer health coverage through the program at any time of the year.
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Premium tax credits
The Premium Tax Credit (PTC) is a refundable tax credit designed to help eligible individuals and families with low or moderate incomes afford health insurance purchased through the Health Insurance Marketplace. The size of the PTC is based on a sliding scale, meaning those with lower incomes receive a larger credit to help cover the cost of their insurance.
When enrolling in Marketplace insurance, individuals can choose to have the Marketplace compute an estimated credit that is paid to their insurance company to lower what they pay for their monthly premiums (advance payments of the PTC, or APTC). Alternatively, they can choose to receive the entire benefit of the credit when they file their tax return for the year. If an individual chooses to have advance payments of the PTC made on their behalf, they will need to reconcile the amount paid in advance with the actual credit computed when they file their tax return for the year.
For tax years other than 2020, if an individual receives the benefit of advance credit payments in any amount, or if they plan to claim the PTC, they must file a federal income tax return with Form 8962, Premium Tax Credit (PTC), attached. This filing requirement applies whether or not the individual would otherwise be required to file a return. For the tax year 2020, Form 8962 does not need to be attached to the tax return unless the PTC is more than the APTC paid for that year (net PTC) and the individual is claiming the net PTC.
If an individual has a Marketplace plan with the PTC for only part of the year, or other household members had different coverage, they must select the other coverage when filing their taxes. It is important to report life changes to the Marketplace as they happen throughout the year, as certain changes to household, income, or family size may affect the amount of the PTC. These changes can alter an individual's tax refund or cause them to owe tax.
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Medicaid and CHIP
Medicaid and the Children's Health Insurance Program (CHIP) are federal programs that provide free or low-cost health coverage to eligible low-income adults, families, children, pregnant women, the elderly, and people with disabilities.
Medicaid is available in all states and provides comprehensive coverage. Each state's Medicaid program must follow federal guidelines, but eligible income levels, coverage, and costs vary from state to state. Some states have expanded their Medicaid programs to cover all people with household incomes below a certain level, while others have expanded their programs to cover adults below a specific income threshold. Some Medicaid programs pay for care directly, while others use private insurance companies to provide coverage. Notably, Medicaid may cover medical care received in the three months before enrolment, even if the individual was not yet enrolled in the program at the time.
CHIP provides health coverage to eligible children through both Medicaid and separate CHIP programs. Children qualify for CHIP if their families' incomes are too high to qualify for Medicaid but too low to afford private coverage. CHIP is managed by individual states according to federal requirements and is funded jointly by states and the federal government. In certain states, CHIP also provides low-cost health coverage to pregnant women in families that earn too much to qualify for Medicaid but insufficient to purchase private insurance.
Individuals can apply for Medicaid and CHIP at any time during the year, and coverage can begin immediately upon qualification. When applying for individual and family coverage through the Health Insurance Marketplace, individuals will be informed if they qualify for Medicaid or CHIP in their state. If denied coverage, the state will securely send the applicant's information to the Marketplace to determine eligibility for savings on a Marketplace plan.
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Dental and vision coverage
The Health Insurance Marketplace is a federal service that helps people shop for and enrol in health insurance. It is operated by the federal government and is available at HealthCare.gov. The Marketplace provides health plan shopping and enrolment services through websites, call centres, and in-person help.
Similarly, vision coverage is not an essential health benefit for adults under the Affordable Care Act (ACA). However, the ACA does classify vision coverage for children as an essential health benefit, so children under the age of 19 (or 21 in Kentucky) will have Marketplace vision insurance included in their ACA plan. While vision coverage for adults is not required, having optional add-on vision insurance can be valuable, especially if you anticipate needing regular eye care.
Some health insurance plans on the Marketplace may include dental and vision coverage, while others may not. You can purchase dental and vision insurance as add-on plans. When shopping for Marketplace dental and vision insurance, carefully review the details of each option, paying attention to the benefits, deductible, copays, and any plan limitations to ensure you have well-rounded coverage.
There are two categories of Marketplace dental plans: high and low. The low coverage level has lower premiums but higher copayments and deductibles, meaning you pay less every month but more when you use dental services. When you compare dental plans in the Marketplace, you will find details about each plan's costs, copayments, deductibles, and services covered. You can also see which plans include dental coverage when you compare them. If a health plan includes dental coverage, the premium covers both health and dental coverage. Separate dental plans are also offered and can be purchased alongside your Marketplace health plan. If you pick a separate dental plan, you will pay a separate premium in addition to the premium for your health plan.
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Frequently asked questions
The federal government operates the Health Insurance Marketplace®, available at HealthCare.gov, for most states. It is a service that helps people shop for and enroll in health insurance.
The Health Insurance Marketplace® provides health plan shopping and enrollment services through websites, call centers, and in-person help. It covers medical, dental, and vision. Small businesses can use the Small Business Health Options Program (SHOP) Marketplace to provide health insurance for their employees.
To be eligible for the Health Insurance Marketplace®, you must live in the United States, be a U.S. citizen or national (or be lawfully present), and not be incarcerated.
When you enroll in a plan through the Health Insurance Marketplace®, you may be eligible for a tax credit that lowers your monthly insurance payment (premium). You'll pay your monthly premiums directly to the insurance company, not the Marketplace.
