Obamacare enrollment: Some important things to know for Year 2

Again it’s enrollment time for Obamacare, and one of the important things to know is this: If you already have health insurance under the law, don’t assume you should simply leave your plan on autopilot.

Your costs could rise more than you think.

That’s because both the premiums for your plan and the tax subsidy you qualify for may have shifted.

President Obama used his weekly address to the nation (given each Saturday) to play the role of pitch man for the health reforms. "Insurance companies can no longer deny you coverage just because you have a preexisting condition," he said. "You can go online or call 1-800-318-2596 and get covered for 2015."

Here’s a primer on Year 2 enrollment under the Affordable Care Act (ACA), including the cost issue and and some others for consumers to consider.

What’s the enrollment period?

Saturday Nov. 15 is the first day to apply for 2015 coverage. The period ends on Feb. 15, 2015, but note that you need to apply by Dec. 15 to have coverage start on Jan. 1. And that’s important, because coverage for 2014 through the marketplace plans ends on Dec. 31.

Will more insurance plans be available this year, or fewer?

In most states there will be more. New entrants will be offering plans in 35 states, according to tracking by the Kaiser Family Foundation. But in California and Oregon the number will decline.

Are premiums soaring?

Not necessarily, but they have risen in most states. And sometimes at double-digit rates, according to average prices on the state exchanges. Many states have increases of 5 percent or less (New York, Georgia, Michigan, Wisconsin, Colorado, and Arizona are among the examples). States with average rises of between 5.1 and 10 percent include California, Florida, and Minnesota.

States where premiums have jumped more than 10 percent are Louisiana, Kansas, Iowa, Pennsylvania, Virginia, Tennessee, North Carolina, and South Carolina. All these numbers were calculated by the Health Research Institute at PricewaterhouseCoopers, using ACA-compliant plans sold both on and off the exchanges. The firm lacked solid data for 15 states.

Behind these averages, the fact is that some particular plans have fallen or surged upward in price. And note that by one alternative measure, the second-lowest “silver” premium offered in each state, prices are pretty flat compared with 2014.

Why should I shop around?

Insurance experts say price is one reason, as you’ll see in a moment. And you also want to make sure the plan you're getting suits your current needs. Changes in your family since last year, for example, might make you want to upgrade from “silver” to “gold” quality, or to switch providers.

Consumers may also want to make sure that doctors they prefer will still be in their provider's network, before re-enrolling.

To see why price comparisons are important, consider how Avalere Health, a consulting firm, analyzed the example of a 40-year-old nonsmoker in Washington State, using data available as of June.

Say that in 2014, a Seattle resident named Dave chose the “benchmark” silver plan, which had a $281 monthly premium. And say his annual income is still $29,000 a year and he wants to stay in the same plan in 2015.

Despite his status-quo intentions, two important things have actually changed. First, the cost of his plan is headed up, to $313 per month. Second, the tax subsidy he’s eligible for is headed down, rather than staying the same or rising along with his premium. That’s because the subsidy is based not only on his income but also on how affordable the “benchmark” plan (the second-lowest silver premium) is in the area. And the benchmark plan for 2015 is no longer Dave’s plan, but a less-expensive one that drags the subsidy down.  

Sticking with his existing plan will cost Dave $598 more per year. He used to pay $196 per month (after the subsidy), now he’ll pay about $50 more.

This example doesn’t mean that everyone's premiums will rise in 2015 or that people should shop on price alone. But it’s important to do your homework. (And when you do consider costs, remember to think about deductibles as well as the premiums.)

How do you shop?

You can start at Healthcare.gov, the federal gateway for shopping on the state marketplaces. From there you can navigate to see options in your local area. Many state exchanges rely on Healthcare.gov as their portal for shopping. In other cases you’ll be directed to an exchange managed by the state, such as the “Covered California” website. A "one-page guide" on the federal website walks you through some important things to consider.

Do I have to buy coverage?

The ACA was designed on the premise that anyone who doesn’t already have coverage, such as through an employer-based plan or through Medicare, should obtain it. The law expands the availability of Medicaid for low-income households, and offers subsidies to make insurance more affordable to others. If you don’t buy insurance, you may owe a tax penalty. The fee is 2 percent of your income, or a flat amount ($325 per adult and $162.50 per child), whichever is higher. Various circumstances may allow you to qualify for an exemption – notably if it would be a financial hardship to pay for insurance.

I enrolled last year. Do I have to do it again?

You don't necessarily have to. But insurance experts recommend that you do a fresh enrollment anyway to make sure you choose carefully and avoid bad surprises.

The federal website says that if you are an enrollee from 2014 who does nothing in the new sign-up period, you will "probably be automatically enrolled in your current plan or a similar plan." (A letter from your insurance provider should tell you for sure if some kind of re-enrollment will occur.) For the reasons already mentioned, though, taking no action could leave you with higher costs or other undesirable results like an altered provider network.

In any case, even if you automatically re-enroll, the federal website urges people to update financial information such as income, to make sure the tax credits are correct. Log into your account on the marketplace to do this. It can be done as soon as you have new information, even if that's after re-enrollment.

If you do enroll afresh, remember that Dec. 15 date, the deadline to make sure coverage is in place by Jan. 1.