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Making Sense Of The Health Insurance Exchange: Carolyn McClanahan

As health insurance exchanges open across the country, including here in Florida, there are still questions as to if and how people can get and maintain coverage using the exchanges.

WJCT asked local health care experts for their advice given four potential scenarios for people who may be eligible for coverage under the Affordable Care Act.

Carolyn McClanahan is a financial planner and physician in Jacksonville. She is the director of financial planning at Life Planning Partners, and she blogs about health care reform for Forbes. 

We asked her what she would tell the following four people given their current health coverage and other factors.

1) "Julie"

  • 43-year-old woman
  • Currently has insurance through her employer
  • Household income of less than $60,000

McClanahan: Julie should stay with her employer coverage as a single individual. If her employer pays a part of the coverage, it most likely makes it less expensive than purchasing insurance on the exchange.

Plus, Julie gets to pay her part of the insurance with pre-tax dollars from her paycheck, which indirectly makes the insurance less expensive. If Julie is single, she will not qualify for a premium tax credit because her income is too high.

2) "John"

  • 25-year-old man
  • Has never purchased or had health insurance and doesn’t understand why he would
  • Household income less than $60,000
  • Qualifies for a subsidy

McClanahan: John should purchase insurance on the health insurance exchange. If this is his income alone, he would not qualify for a subsidy, so I assume there are other people in the household.

Why should John have insurance? Premiums for him will likely be in the mid $100 range per month. It may seem expensive, but even a moderate illness or injury can cost much more.

Carolyn McClanahan

For example, if he breaks an ankle and needs surgery, cost can easily run over $10,000. Diseases such as cancer can easily cost $1 million. We purchase insurance for our cars and homes, and should do the same to protect our most important possession — our body.

Of note, since John is under 30, he can purchase "catastrophic" coverage at a slightly cheaper price. It pays for three primary care visits and preventive care without deductibles or co-pays. If he becomes ill, he'll have to pay more out of pocket until he has reached the maximum out of pocket amount of $6,450.

3) "Maria"

  • 30 year old woman
  • Self-employed, Currently purchases her own insurance
  • Household income of less than $60,000
  • Qualifies for a subsidy
  • Has a child with another child on the way

McClanahan: Maria should definitely shop for health insurance on the exchange for her and her children and she will receive a premium tax credit to help pay for the coverage. A wonderful benefit of the new health insurance policies is good coverage for maternity care. In Florida, individually purchased insurance provided minimal maternity benefits at a high cost. The new policies no longer make pregnancy a "pre-existing" condition.

4) "Adam"

  • 56-year-old man
  • Currently has insurance through his employer, but employer is dropping coverage.
  • Has never purchased his own insurance
  • Household income of less than $60,000
  • Does not qualify for a subsidy
  • Has diabetes

McClanahan: Adam should purchase insurance through the exchange. Because his income is too high, he will have to pay the full price for the insurance. The good news for Adam — he can get coverage!

In Florida, people with even minor pre-existing conditions could not purchase coverage on the individual market. The insurance will likely cost more than his employer based coverage, and it is still very important for him to have coverage.

Email us your questions on getting coverage using the health exchanges and we may feature them in a future post.

Patrick Donges served as WJCT's Digital Content Editor from August 2013 - August 2014.