What is the health insurance Marketplace?

ACA Marketplace plans are health care plans that people can buy on their own, rather than through an employer or another government-run program, like Medicare or Medicaid. You might also hear names like Exchange plans and Individual & Family Plans. The ACA Marketplace (also called the Exchange) is where ACA health care plans are sold.

Under the American Rescue Plan Act of 2021 (ARPA) and Inflation Reduction Act of 2022, you may be able to enroll in ACA Marketplace coverage with lower premiums — and you can see if you qualify for financial subsidies. These subsidies could be tax credits or cost-sharing reductions to help pay for your health care costs.

A pre-existing condition is a health issue you had before your health plan starts. Under current law, companies offering ACA Marketplace health plans that meet minimum essential coverage requirements can't refuse to cover you or charge you more because of a pre-existing condition.

A copay (or copayment) is a fixed amount you may pay for a covered health care service, usually at the time you receive the service.

You might remember times when you went in for a doctor visit and maybe paid a $15 or $20 copay before or after your visit (copay amounts vary depending on the provider and service). That’s how copays work. With health plans that have copays (not all do), you’ll know what you have to pay ahead of time, which can help you budget your health care costs. For most plans, your copay does not apply toward your deductible.

Coinsurance is a percentage of the cost of a health care service, and it’s what you pay once you meet your deductible. A common coinsurance amount is 20%, but the cost-sharing percentages could be anything.

If your doctor visit costs $100 and you’ve met your deductible, your coinsurance payment of 20% would be $20 out-of-pocket. Your insurance would then pay the rest of the allowed amount ($80) for covered health care services.

You might have heard terms like out-of-pocket max or limit. They mean the same thing. They each refer to the most you could pay during a 12-month coverage period for your share of the costs of covered services. Typically, deductibles, copays and coinsurance all count toward your out-of-pocket maximum. Things like your monthly premium or anything your plan doesn't cover (like out-of-network services) do not.

If you meet your out-of-pocket maximum, your plan will pay for 100% of your covered health care costs (up to the allowed amount). Let’s say you have an annual out-of-pocket maximum of $6,000. That means once you’ve paid $6,000 out-of-pocket for your covered health care, usually including deductibles, copays and coinsurance, your plan will cover any future (covered, in-network) health care services during your coverage period.