Consumer Alert: Health Insurance Plans with Limited Benefits
Although the Affordable Care Act established a marketplace
for consumers to shop for individual health insurance policies, off marketplace
health insurance plans are available through insurance agents and companies and
can still be purchased in Pennsylvania.
Marketplace plans are only available online through www.Healthcare.gov. Websites like
Healthcare.com are NOT the federal marketplace and you will not be eligible for
a subsidy if you purchase from a website that is not www.Healthcare.gov.
Off-marketplace plans may advertise coverage at a lower rate
than plans available through the federal marketplace, but it is important that
you research the exact details of the plan before making a purchase.
Many of these plans offer a limited scope of benefits,
meaning they may not provide coverage for routine medical visits, preventive
care, or diagnostic testing. Because of this, many of these plans do not meet
minimum essential coverage requirements set forth by the Affordable Care Act.
If this type of plan is your only medical coverage, you will not receive a 1095
tax form and may face a penalty for not having proper coverage.
Unlike plans sold through the federal marketplace, these
plans often do not cover pre-existing conditions. You will not receive coverage
for procedures related to any pre-existing conditions.
In addition, many of these plans have pre-designated
reimbursement rates for types of services. For example, you could be reimbursed
$200 for a trip to the emergency room. Coverage usually ends at that
reimbursement, so any remaining bills or additional services will likely be
Before purchasing a health insurance plan, it is important
that you understand the details of the policy. Be sure that you can answer the
- Did you review the policy? Do you understand
what it does and does not cover?
- Does the plan meet minimum essential coverage
requirements? Does this plan provide a 1095 tax form?
- Does this plan provide coverage for preventive,
diagnostic, and other routine services and visits?
- Are your doctors in this plan’s provider network?
Be wary and don’t be afraid to ask the insurance agent
questions to make sure you are getting your money’s worth. If you purchase a
policy and decide that it isn’t what you want, you may return it for a full
refund during the policy’s free look period. Information on this should be
outlined in the policy, so make sure you read all documents before you pay any
Do you have questions or concerns regarding a
plan you purchased? Would you like to verify if an insurance company or agent
is licensed in Pennsylvania? Contact the Insurance Department at 1-877-881-6388
or online at www.insurance.pa.gov.