Massachusetts Health Insurance Plans and Policies
In 2016, over 200,000 Massachusetts residents enrolled in a medical insurance plan through the public exchange. Massachusetts is one of the leaders in leading the Affordable Care Act mission and as a result offers subsidies to make private plans more affordable for citizens that are at 300% of the Federal Poverty Line.
Common MA Health Insurance Plans and Policies
Below are the most common types of Massachusetts health insurance plans and policies offered through the various exchanges:
Individual Health Insurance
Individual medical insurance policies are those that are not affiliated with a place of employment. If you do not feel that your employer's benefits package covers your needs, you can decline coverage and opt for an individual health insurance plan instead. You may also purchase an individual health insurance plan if you are not offered individual health insurance through your employer.
Unlike the rest of the nation, the Massachusetts individual health insurance market will be largely unaffected by UnitedHealthcare no longer offering coverage to their region. In addition, rate increases for individual plans will once again be much lower than the national average.
Learn more about individual health insurance quotes and options.
Group Health Insurance
Group Massachusetts medical insurance policies can be affiliated in one of two ways. They are most commonly affiliated with a place of employment or to groups of individuals based on professional, religious or social ties who decide to create their own group health insurance plan for increased negotiating power.
Short Term Health Insurance
Typically short term health insurance is a temporary option for coverage when you find yourself in a short lapse of insurance coverage. Short term health insurance, unfortunately, does not meet the minimum requirements of the Affordable Care Act (Obamacare). As such, Massachusetts government mandates have been put in place that do not allow short term options to be available to Massachusetts residents.
Learn more about Short Term health insurance rates and options.
Self-Employed Health Insurance
If you are self-employed with a fluctuating income, self-employed health insurance may be the route to take for your health insurance. This type of coverage is a great option for those who may need to modify their coverage during the year based on how well their personal business and finances do.
Learn more about Self-Employed health insurance quotes and options.
COBRA is a federal law that temporarily allows you to continue the health insurance coverage that was provided by a previous employer. The downside of COBRA is that it requires that you pay 100% of your plan’s premiums in addition to an administrative fee.
Common Massachusetts Health Insurance Plans and Policies
Thanks to the Affordable Care Act, the minimum benefits and coverage available through Massachusetts private health insurance plans are the same whether purchased on or off the public exchange. Health insurance Massachusetts plans meet the federal guidelines outlined in the Affordable Care Act that are applicable to consumer choice plans and employer plans.
Learn more about health insurance rates and options .
What Is a PPO plan?
A PPO (Preferred Provider Organization) is a health plan that allows you to seek care from outside the network, but it will require you to pay an additional cost for that ability.
Pros and Cons of PPO Plans
A benefit for utilizing a PPO is the ability to see a specialist without a referral. This option is normally more expensive and is generally being phased out due to the overall financial impact to the healthcare industry.
What Is An HMO plan?
An HMO (Health Maintenance Organization) is a plan that requires you to seek care from within the HMO. You must get a referral from your primary care doctor to see a specialist.
Pros and Cons of HMO plans
HMOs are very focused on integrated care and normally have great coverage on preventative care or maintenance such as vaccines, well-woman exams, and physicals. Seeing your primary care doctor is normally very responsible. Unfortunately, you are only allowed to see who is within the HMO plan and you have to get a referral to see a specialist.
Difference Between HMO and PPO
HMOs are very focused on reducing the cost of care by having the primary care doctor be the gatekeeper to other more expensive points of entry into the healthcare system. A PPO, on the other hand, allows a patient to seek care outside the network at an additional out-of-pocket cost.
FSA Plans - Flexible Spending Accounts or Arrangements
What Is An FSA plan?
A Flexible Spending Account (FSA) will be set up through an employer-sponsored insurance that allows you to contribute pre-taxed wages from your paycheck into an account that can be used for out-of-pocket medical expenses like copays and deductibles.
Pros and Cons of FSA Plans
The benefit of using an FSA is the ability to budget medical care with wages that will not be taxed. Unlike an HSA account, you cannot carry over FSA funds to the next year or to a new job. You either use it or lose it so there is little benefit to being over-prepared.
Flexible Benefits plan (Cafeteria Plan) (IRS 125 Plan)
What is a Cafeteria Plan?
A Flexible Benefits Plan, also commonly referred to as a Cafeteria Plan, enables you to contribute pre-taxed wages into an account that can be used for dependent care expenses (i.e. day care or elderly care services).
Pros and cons of a Cafeteria Plan
The benefit of a Cafeteria Plan is it allows an individual to create their own benefits package in a way that is meaningful for their life situation, whether that is additional dental coverage or child care by contributing pre-taxed wages.
HSA Plans - Health Savings Account Plans
What is an HSA plan?
A Health Savings Account (HSA) gives you the ability to contribute pre-taxed wages into an account that can be used for out -of-pocket medical expenses like copays and deductibles. This does not have to be set up through your employer. It can be done through any financial institute. This is a great supplement for high deductible plans.
Pros and cons of HSA Plans
The benefit of using an HSA is that it allows you to take advantage of the lower premiums that come with high-deductible plans and still be able to pay the out-of-pocket financial commitment.
Unlike the FSA account, you can roll over balances to the next year and transfer it to a new account if you make an employment change.
Medical Savings Accounts (MSA)
What is an MSA?
A Medical Savings Account gives self-employed individuals the ability to contribute pre-taxed wages into an account that can be used for out-of-pocket medical expenses like copays and deductibles. Just like an HSA, it is a great supplement for high deductible plans. There are two specific kinds of MSA accounts. The most common is the Archer MSA, but for those that qualify for Medicare, Medicare Advantage MSA should be used.
Pros and cons of an MSA?
The benefits are very similar to an HSA in that you can take advantage of the lower premiums that come with high-deductible plans and balances can be rolled over year-after-year. The downside is that only one family member can contribute to the MSA account.
What are Indemnity Plans?
Indemnity plans are not common any longer, but they were prevalent before HMOs and PPOs. These plans were often called Fee-For-Service and the insurer and the insured would split a percentage of the total charges. For example, if a procedure was $1,000, you might be responsible for 20% and the insurance company would then be responsible for 80%. This means that you would pay $200. If the facility decided to increase prices, you would be expected to pay more out-of-pocket.
Why would I need an indemnity plan?
Because HMO and PPO plans have become more popular, indemnity plans are not commonly available and may not be recommended for most people.
Massachusetts Health Insurance FAQ
- How much does group health insurance cost?
The cost of group health insurance will depend on the negotiated contract between the group applying for health coverage and the insurance company. Group rates typically vary based on the number of participants in your group, location, demographics, the insurance carrier, desired plan coverage, plan structure, and the availability of providers. According to a study by Kaiser Family Foundation (KFF), group policies in 2015 averaged $6,251 annually with the employer paying 83% of the premium costs ($5,179). This left the employee with 17% of the cost ($1,071). The average annual family premium cost is $17,545. All premiums for single and family coverage have increased about 4% between 2014 and 2015.
- Can I get group insurance without an employer?
Yes, you can get group insurance without going through an employer-sponsored program. There are many professional groups that offer insurance options such as alumni groups, the AARP, the Small Business Service Bureau, and more.
- What is small business health insurance?
Small businesses that have two or more employees have the ability to apply for group insurance. To qualify, at least one other employee (other than the owner) must be a non-relative or non-household dependent. The maximum employees for small business health insurance categorization is often capped at 50-100 employees, depending on the current state regulations. Small businesses benefit by enrolling into a small business health insurance plan as they often qualify for special tax breaks.
- How do I know if my private health insurance satisfies the Obamacare requirement?
Verify with your insurance provider that your health insurance plan meets the standards for an Obamacare or Affordable Care Act, qualified health plan and has been certified by the Health Insurance Marketplace.
- Do I have to have health insurance if I'm in college?
Yes, even college students are required to have health insurance. If you are a college student and do not have health insurance, you will face paying a penalty. There are several options for college students that are affordable, some of which are offered through college health centers.
- How long can I stay on my parent's insurance plan as a dependent?
If your parent's plan allows you to be covered as a dependent, you can stay on their plan until your 26th birthday. This is the case even if you are not claimed as a dependent on their state or federal taxes, are married, or are not in school.