Michigan Health Insurance Guide
Michigan Health Insurance Information, Resources and Access to Online Health Insurance Quotes
As a Michigan resident you can choose from health insurance plans offered to individuals and groups by private insurance companies. Michigan plans to open its own healthcare exchange. Until then you may also purchase individual and family coverage from participating private insurers through HealthCare.gov, the federal exchange. If you are self-employed with no employees, you can also use the federal exchange to purchase coverage. You may also be entitled to certain state and federal programs such as Medicaid and COBRA.
Michigan and the Patient Protection and Affordable Care Act of 2010
The Patient Protection and Affordable Care Act (also known as ObamaCare and the Affordable Care Act and referred to in this guide as ACA) became law in 2010. Provisions of the law have continued to be phased in following passage. As of January 1, 2014, most U.S. citizens and legal residents are required by law to have qualifying health care coverage or pay an annual tax penalty for every month they go without insurance. This is called the “individual mandate.” There is a grace period through March 31, 2014. Beginning in 2014, the penalty for not having qualifying coverage is $95 per adult and $47.50 per child or 1% of your taxable income, whichever is higher (up to $285 per family). The penalty increases annually through 2017 and beyond.
Individual Mandate Exemptions
You may be exempt from the individual mandate and tax penalties if:
- You have religious objections
- Are in the U.S. illegally
- Are in jail
- The cost of coverage exceeds 8% of your household income
- Your income is below 100% of the poverty level
- You have hardship waivers
- You are not covered for fewer than three months during the calendar year
Michigan Small Business Coverage
If you own a small business in Michigan (50 or fewer full-time-equivalent employees – FTEs), you can purchase qualifying coverage for your employees through SHOP, the Small Business Health Option Program or through a private broker or insurance agent. However, you may qualify for tax credits worth up to 50% of your premium costs if you use SHOP. Beginning in 2016, SHOP will be open to employers with up to 100 FTEs. Under the Employer Shared Responsibility provision of ACA, beginning in 2015, all employers with 50 or more FTEs must offer employees at least one plan that is ACA-compliant or face fines of $2,000 per employee.
ACA Standardized Benefits
Plans offered by private insurers may offer additional benefits and individual states may require additional benefits, but all qualifying plans must offer these 10 standardized essential benefits:
- Ambulatory patient service
- Emergency services*
- Maternity and newborn care*
- Mental health and substance use disorder services including behavioral health treatment*
- Prescription drugs*
- Rehabilitative and habilitative services and devices
- Preventive and wellness and chronic disease management for adults and children*
- Pediatric service, including oral and vision care*
*Lifetime dollar limits on these essential health benefits have been eliminated.
Michigan Additional Mandated Benefits
Michigan currently mandates that the following benefits, which exceed ACA requirements, must be provided or offered by private providers authorized to sell health insurance within the state:
- Hospice services – for HMOs and small group plans
- Home health care services – for HMO small group plans
- Emergency transportation/ambulance – for HMO small group plans
- Outpatient rehabilitation services – for breast cancer – for HMO small group plans
- Durable medical equipment – mastectomy prosthetics – for HMO small group plans
- X-rays and diagnostic imaging - for HMO small group plans
- CT/PET Scans, MRIs - for HMO small group plans
- Reconstructive surgery – following mastectomy - for HMO small group plans
- Prescription drugs other – antineoplastic surgery drugs – for HMO small group plans
Michigan Available Standardized Plans
To help you more easily compare costs and benefits, ACA designates that all qualifying plans be one of four metals: Bronze, Silver, Gold and Platinum. Each is based on the average amount of healthcare costs the plan will cover shown as a percentage of what is covered by your insurance company and what is paid for by you. All insurers participating in the federal or a state healthcare exchange must offer , at minimum, Silver and Gold plans. All metal plans have a shared maximum out-of-pocket amount that you can be charged in any calendar year.
|Metal Plan||Insurer Pays||You Pay|
In addition, if you are under 30 or meet the criteria for a hardship exemption, you an purchase a catastrophic plan that is compliant with ACA requirements.
Premiums charged for any of the qualifying metal plans may be based on:
- Your age
- Tobacco use
- Where you live - determined by rating area
- The number of family members enrolling with you
Under ACA, no one can be denied coverage or charged significantly higher premiums because of past health history (pre-existing conditions) or gender. There can be no look-back or waiting periods imposed. Policies are effective on issue. All coverage is renewable, if you choose to renew it. Plans can only be canceled for non-payment of premiums or fraud. The guaranteed issue provision applies to all non-grandfathered plans.
ACA Financial Assistance
You may qualify for financial assistance in the form of tax credits to help with monthly premiums and subsidies to help with out-of-pocket costs.
- Tax credits can be applied to any of the four metal plans to lower your monthly premiums. They are paid directly to your insurance provider by the federal government. Your tax credit is based on your estimated income for the calendar year, in advance of filing your federal return. Note that if your actual income exceeds the eligibility limit, you will have to reimburse the government for the difference. Tax credits are only available to Michigan residents who purchase coverage from HealthCare.gov.
- Subsidies to help Michigan residents with out-of-pocket expenses such as copayments are only available for Silver plans purchased through HealthCare.gov and are only offered to those who earn up to 250% of the federal poverty level.
- Preferred Provider Organizations (PPOs)
You have access to a network of healthcare providers participating in your selected PPO. You do not have to select a Primary Care Physician or obtain a referral to see any in-network provider. Some PPOs may require that you meet a deductible before their portion of the coverage begins.
- Health Maintenance Organizations (HMOs)
Most HMOs require you to select a Primary Care Physician to coordinate your healthcare and provide referrals to specialists. HMOs typically charge a fixed copayment for each doctor visit and other care provided. Depending on the HMO, there may be a low deductible or no deductible in addition to the copayments. All services must be obtained through the HMO’s network, unless otherwise stated in your plan.
- High-Deductible Health Plans with Health Savings Accounts (HDHP w/HSAs)
These plans give you more control over your out-of-pocket expenses by offering lower monthly premiums with higher deductibles. They are typically combined with HSAs that allow you to set aside interest-earning pretax funds (through your employer’s payroll deduction) or tax-deductible funds you deposit in a private account. These funds can be drawn on to cover your healthcare costs. Any interest accrued is tax-deferred and any unused funds can roll over from year to year. See your tax advisor for information specific to your situation.
- Flexible Spending Accounts (FSAs)
ACA provisions allow you to continue to make tax-free contributions up to $2,500 per year to an FSA. These can be used for out-of-pocket healthcare expenses not covered by your insurance plan. This includes many over-the-counter (OTC) preparations, devices and equipment as allowed by law. However, you will need to obtain a prescription for OTC items and submit an itemized receipt to qualify for the tax deduction.
Michigan Healthcare Resources
Low- and no-cost healthcare for Michigan residents include:
Michigan Regulating Agencies and Insurance Information Resources
Michigan Department of Insurance and Financial Services
PO Box 30220,
Lansing, MI 48909
Insurance Information Institute
110 William Street,
New York, NY 10038
Federal Healthcare Exchange
SHOP Michigan – Healthcare Insurance for Small Businesses
Fast Facts About ObamaCare