Group Health Insurance vs Marketplace Coverage

Discover all your options for group health insurance before turning to marketplace coverage.

After the Affordable Care Act was passed, many Americans have found reason to complain. Whether you agree politically with the Affordable Care Act or not, you know by now that you’ll be charged a penalty for not having health insurance. Businesses with over 50 employees must now offer their full-time employees health insurance. While there are standards that health insurance must meet under the Affordable Care Act with regards to level of coverage and premium cost, there are some who may still find their employer’s health coverage to be inadequate or overpriced. However, it is important to know what awaits you before turning to the Marketplace.

Many people qualify for tax credits to help cover the cost of their health coverage through the marketplace. Those without employer based health insurance as an option are able to pick freely from many plans in the marketplace and use a tax credit in order to pay for the plan. These tax credits can be applied each month to allow you to pay lower premiums each month, or may be given to you in a lump sum on your tax return.

If you’re unhappy with the insurance your employer offers, you may be considered ineligible for these tax credits which put the “affordable” in the Affordable Care Act. Because your employer is likely receiving tax credits for offering the plan available to you, and because they are likely paying a part of your premium, even if you are eligible for tax credits based on your income, your employer’s ability to supplement your premiums makes you ineligible for the tax credits on an individual basis.

This is only true, however, as long as your employer is offering a plan that meets minimum coverage and affordability standards. If you truly find your employer’s plan to be sub-par make sure to go over the plan carefully with an insurance broker or on your own to verify that the plan does meet affordability and coverage requirements.  Should you find that the plan offered by your employer does not meet minimum requirements, then be sure to apply for marketplace coverage before open enrollment ends. You’ll likely have to fill out some additional paperwork, but you may be able to choose your own plan from the marketplace while still receiving tax credits for your insurance.

Whether you believe that healthcare is now affordable or not, it’s important to recognize that you will be charged a penalty on your taxes should you go uninsured. Most employers who are able to offer group health insurance have put much time and effort into making sure that insurance plans meet new federal guidelines for coverage and affordability, but it never hurts to be sure that you’re getting the best coverage for your money.