Advice and Explanations

  1. Introduction    (show content)
  2. Frequently Asked Questions    (show content)
  3. Plan Information    (show content)
  4. Calculation Methods and Data Used in this Tool   

1. Introduction

Choosing among plans is especially difficult for almost all of us. The purpose of this tool is to help you understand your options, and to choose the plan or plans that are most likely to meet the needs of you and your family at lowest cost.

What does this plan comparison tool do? This tool can help you choose the best health insurance plan to meet your specific needs and preferences. You can compare plans on Cost, Risk, and other features.

  • Cost: Compares plans not just on premiums or deductibles, but also on total estimated average costs for someone like you or your family. This "actuarial" approach can be the best way to compare plans on cost, taking into account not just premiums but the additional out-of-pocket costs you may experience because of deductibles, copayments, coinsurance, and other terms. Our cost estimates anticipate not only the costs you can predict but also the chances of having costs you can't predict. We boil all this complexity down into a single-dollar-amount figure for each, making comparison easy.
  • Risk: The CHECKBOOK tool estimates what costs for a family like yours would be in a bad (high healthcare expense) year to help you assess the range of your financial risk under each plan. Plans can rank differently on costs in bad years than in average years. Our dollar estimate of cost in a "bad" year with each plan makes comparison simple.

Will this tool tell me if I get a subsidy to help pay my premiums, and how much it will be?

This tool can provide an estimate. By telling us about those in your family who need coverage, the number of members in your household (everyone on your tax return), your household income, and a bit more, you enable us to calculate your likely premium tax credit subsidy and apply it to the cost comparisons for the plans available to you. Final calculation of any available subsidy will be performed when you actually apply for insurance through Vermont Health Connect.

Will this tool tell me if any or all of my family members are eligible for other health insurance programs like Medicaid or Dr. Dynasaur?

Based on the information you provide, we will tell you which family members may be eligible for insurance through Vermont Health Connect, Medicaid or Dr. Dynasaur. An official determination of eligibility for these programs will be made when you actually apply for insurance through Vermont Health Connect. Some families will find that their insurance costs are lowest if, for example, their children enroll in Dr. Dynasaur, one spouse in Medicaid, and the other spouse in Vermont Health Connect. This tool will give you information on such options, which can be complicated.

What does it mean to me if one or more of my family members are offered health insurance through an employer?

If an employer is offering health insurance for which even one family member is eligible, there is a good chance you and your family members will not be eligible for a subsidy to help you purchase insurance through Vermont Health Connect, meaning you will have to pay full price in Vermont Health Connect. Having insurance available from an employer does not affect eligibility for Medicaid or Dr. Dynasaur. Having insurance available from an employer will not bar you from getting a subsidy through Vermont Health Connect if the employer coverage is too expensive (costs more than 9.56% of your income to cover the employed person) or if it does not cover the range of benefits required under the Affordable Care Act. When using this tool, you will be able to see what your subsidy would be if you have employer coverage that turns out to be too expensive or covers too limited benefits only if you answer "No" to the question regarding employer coverage in the tool. If you indicate you have employer coverage available, the tool shows your options for purchasing a health plan through Vermont Health Connect without a subsidy.

What are the "plan types" and what difference does "plan type" make?

The plans available to you through Vermont Health Connect include, HMOs (Health Maintenance Organizations) and EPOs (Exclusive Provider Organization). The costs shown for each plan assume you use the plan's preferred providers. Your costs will be higher if you use providers that are out-of-network.

An HMO (Health Maintenance Organization) typically has a network of doctors and does not pay for care outside that network except in limited circumstances (except in an emergency). Generally, in an HMO, you are required to choose a primary care doctor and a few HMO plans will pay for care from other providers only if you are referred to them by your primary care doctors.

An EPO (Exclusive Provider Organization) plan is a managed care plan where services are covered only if you go to doctors, specialists or hospitals in the plan's network (except in an emergency).

What does it mean if the plan is eligible for a Health Savings Account (HSA)?

Health Savings Accounts (HSAs) are often available with high deductible health plans as a way to save money for your expenses. The funds contributed to the account aren't subject to federal income tax at the time of deposit. Funds must be used to pay for qualified medical expenses like prescription drugs. Unlike a Flexible Spending Account (FSA), the funds in HSAs roll over year to year if you don't spend them.

What do bronze, silver, gold and platinum mean?

Most health plans are categorized as platinum, gold, silver or bronze, also known as metal levels. The metal levels represent different benefit levels of the plans. The difference in the metal levels is based on how much of the cost of your care is paid by you and how much is paid by the plan. The actual percentage you'll pay in total or per service will depend on the services you use during the year.

Bronze: The health plan pays 60% on average. You pay about 40%.

Silver: The health plan pays 70% on average. You pay about 30%. silver plans may offer the best value if you are eligible for cost sharing reductions.

Gold: The health plan pays 80% on average. You pay about 20%.

Platinum: The health plan pays 90% on average. You pay about 10%.

2. Frequently Asked Questions

What are the main elements of cost?

As you think about options, you will be interested in cost. There are two big elements of cost—the premium you will have to pay to be in a plan and the out-of-pocket costs you will have to pay for healthcare services and products that the plan doesn't fully cover. This website gives you information on both, with a total cost estimate for people like you combining premium plus out-of-pocket costs.

Why does the website start by asking me questions about family size, ages, relationship, income, etc.?

The questions we ask at the beginning are necessary to help us calculate your eligibility, your premium costs, your premium tax credit subsidy (if any), whether you will be eligible for a silver-level plan with reduced deductibles and other cost-sharing, and whether family members might be eligible for Medicaid and/or Dr. Dynasaur. To figure those things out, we ask questions about ages, relationship, income, family size, and other matters. Additional optional questions on health status and expected major medical procedures help us to calculate the likely (and not so likely) expenses of each family member. Your health status does not influence the premium amount for a plan and is only used to help estimate your out of pocket costs. On average, people with excellent health will have expenses in the coming year lower than those of the same age who are in fair or poor health.

What do I need to know about estimating income?

One particularly important question related to your overall cost is your estimate of your expected annual income for 2018, because that affects whether you will be able to get a tax credit (subsidy) to help you pay for insurance you buy through Vermont Health Connect, whether you will be eligible to enroll in a silver-level plan with reduced deductibles and other cost-sharing, and whether family members might be eligible for Medicaid and/or Dr. Dynasaur.

Common sources of income that will need to be counted in addition to wages and salaries are self-employment income, interest and dividends received, alimony received, and Social Security payments received.

We understand that no one knows this expected income number exactly ahead of time. In fact, hardly anyone will know it exactly until he or she fills out the tax return for 2018, in early 2019. Pay increases, overtime, layoffs, job changes, and various other factors will affect income. But it is important that you try to come close to the right figure so that our calculations of subsidy and eligibility are as close as possible to the calculations the government will make when you actually apply for insurance in Vermont Health Connect. The government will ask for your Social Security number and other information and will use that to check records at the Internal Revenue Service and other sources; we, of course, do NOT do that.

But as a practical matter, for most people, giving an income estimate that is off by $1,000 or so will not have much effect. You might help yourself come up with a good estimate by looking at your 2018 or 2017 tax return and thinking about likely changes, such as a promotion or changes in overtime. You might also get a reasonable idea by thinking about weekly income or monthly income, and multiplying. But be careful how you do this. The income that counts is your "adjusted gross income" (AGI) (with some minor adjustments). That is not the same as your take-home pay. AGI is before taxes; take-home pay is after withholding taxes. You need your estimate to be before taxes. You can also look at the W-2 statements that you get from employers in early 2018 to help compute 2017 taxes, or even pay stubs from employers.

How is the income figure used to calculate premium subsidies?

Your dollar income figure will be used, along with your family size, to determine at what percent of the poverty level your family is. For example, a husband and wife with an income of $32,480 is classified as just over 200 percent of the poverty level in 2017. Where you are relative to the poverty level determines how much you will be expected to pay for insurance and how much subsidy you will get. For example, a family at 201 percent of the poverty level will be expected to pay no more than 6.34% of its income to get insurance coverage in the second-lowest-cost Silver-level plan available to it. It will get a premium subsidy (tax credit) equal to the difference between 6.34% of its income and the premium of the second-lowest-premium silver-level plan on in Vermont Health Connect. For a Vermont couple with two 40 year-olds and $32,000 in income, for example, that would be a subsidy of about $9,912 per year.

Can I take less subsidy than I am entitled to now and then get a tax credit to make up the difference when I file my 2018 tax return?

Yes. If you want to be sure you are not hit with a penalty when you file your 2018 return in early 2018, you can take less subsidy than your expected income would entitle you to. That means you will pay more for premiums each month than you would have to if you used all of the tax credit you are entitled to, but it will entitle you to a refund when you file your tax return in 2018, or at least reduce your risk of having a substantial penalty if you end up having a higher 2018 income than you currently expect.

What if I overestimate or underestimate my income when using this website?

If you over- or underestimate your income when answering the questions at the beginning of this website, we might underestimate or overestimate the amount of subsidy and other financial help you will be entitled to.

You can easily go back and try a couple of different income estimates for your family if you want to see how different income amounts would affect your subsidy amounts and how much other financial help you might get. It is quick to change numbers by just clicking on the "Start Again" link at the top of any page.

What if I overestimate or underestimate my income when actually applying on the Vermont Health Connect website, and I qualify for tax credit?

Vermont Health Connect may ask you to send proof of your income if the information you provide is not consistent with the information found by its check of government records. If you are approved for tax credit, and you overestimated your income on your official application, you will get a tax credit at the time of filing your tax return for the 2018 year to make up for the fact you got a lower subsidy than you would have gotten if you had estimated a lower income. On the other hand, if you have underestimated your income on your official application, you will have to pay the IRS when filing your tax return for the year 2018 an amount to make up for the fact that you got more subsidy during 2018 than you should have.

Is there a limit on how much I will have to pay the IRS if my income goes up after I receive an insurance subsidy?

If your income goes up, you may have to repay some of the money, but the amount you'd owe would likely be capped. Every individual's circumstances are different, but here's how it might work in a typical situation. When you apply for health insurance on Vermont Health Connect, you'll be asked about your income. If you're earning, for example, about $24,000 a year, you would qualify for a premium tax credit. If you choose to receive the credit up front rather than at tax time next year, your insurance premium would be reduced by the amount of your tax credit, and the government would send that amount to the insurer. Suppose you land a job half way through the year with a $52,000 annual salary, but the small employer doesn't offer health insurance. At that point, you'd need to inform Vermont Health Connect about your change in circumstance. At the higher salary, you'd no longer qualify for a premium tax credit, and you'd have to pay the full premium. At tax time, the government will reconcile the amount that you received in tax credits against your income for the year. In our example, this income for the year would be about $38,000, including six months at each wage level.

If the amount you received in tax credits is higher than it should have been based on your annual income, you'll have to pay back the difference. But under the law, your liability is limited if your income is less than 400 percent of the federal poverty level. Someone like you with income between 300 and 400 percent of poverty ($36,180 to $48,240 for 2017) would be liable to repay no more than $1,250.

What if I am not a U.S. citizen? Am I eligible?

The basic answer is that if you are lawfully present in the United States, you may be eligible for a tax credit, to buy a health plan at full cost through Vermont Health Connect just like anyone who is an American citizen. If you are not lawfully present, you are not eligible for a tax credit, or to buy health insurance through Vermont Health Connect, or for Medicaid. You may qualify for Dr. Dynasaur if you are not lawfully present and you are pregnant. This doesn't mean that you or your family members may not have other ways to get health care in many circumstances, such as emergencies, just that you may not enroll through Vermont Health Connect.

If you want to check your family's eligibility for all health insurance options through Vermont Health Connect, including Medicaid or Dr. Dynasaur, you can apply through Vermont Health Connect. Families that include immigrants can apply. You can apply for your child even if you are not eligible for coverage. Applying will not affect your immigration status or chances of becoming a permanent resident or U.S. citizen.

My employer offers health benefits at work but I want to see if I can get a better deal by purchasing a plan in Vermont Health Connect. Can I do that?

You can always shop for coverage on Vermont Health Connect, assuming you meet other eligibility requirements, but if you have access to job-based coverage, you probably will not qualify for premium tax credits. However, a person whose share of the employer plan premium for a self-only is so expensive—9.56 percent or more of his or her pay—meets a special exception that allows him or her to get a subsidy.

3. Plan Information

After you have completed the questions asked by the tool, you will be taken to the summary plan results page. For most people, it will take only a few minutes to get this far. This is where you first see a display of which plans may be best for you on the basis of costs.

When you get to the plan listing page, we show you the key information on each plan with the plans listed in order of estimated average cost for someone like you, lowest cost first. We show you all plans, if you want to scroll down that far, because even a plan that costs more may have something of value to you, and you can easily sort and filter plans.

A key column in this display is the "Yearly Cost Estimate," which is the total cost to you for both premiums (after any premium tax credit/subsidy) and estimated average out-of-pocket costs for persons like you or families like yours. Our cost comparisons cover medical, hospital, and prescription drug costs. They show how you are likely to fare under every plan available to families like yours. We also show how each plan ranks in a bad (high health-care-usage) year so you can further assess levels of financial risk for you.

The plans we list are those available to you. We want you to see all the plans you can choose, without any filters to eliminate plans that may actually be best buys. In addition to information on costs, we give you basic information on each plan such as its name, what kind of plan it is, the monthly premium after any available subsidy, and the plan's deductible.

Our cost ratings tell you how much you are likely to pay for premiums after deducting any subsidy, plus out-of-pocket (unreimbursed) medical expenses. Our ratings assume that your bills may be for almost any type or size of expense, including:

  • hospital room and board for surgical or medical care for any illness;
  • other types of hospital services (operating room, anesthesia);
  • surgery, in or out of a hospital;
  • diagnostic tests, X-rays, and lab tests in or out of a hospital;
  • doctor visits in or out of a hospital when you are ill;
  • mental health treatment, outpatient and inpatient;
  • mammograms, Pap smears, and routine immunizations;
  • maternity, even if you are in a self-only plan;
  • emergency care in or out of a hospital;
  • prescription drugs, including insulin and syringes for diabetics;
  • nursing care after an illness;
  • chemotherapy and radiation therapy;
  • physical and rehabilitation therapy;
  • cosmetic ("plastic") surgery or oral surgery-only after an accident;
  • preventive care including physical examinations and vaccines; and
  • all of these expenses even if you have a preexisting condition or are hospitalized on the date when your enrollment begins.

When you indicate on our "Get Started" page that you expect a particular type of major medical procedure this year, we also take that into account, including:

  • vaginal delivery;
  • caesarian delivery;
  • laparoscopic surgery;
  • hysterectomy;
  • laminectomy;
  • percutaneous coronary surgery,
  • large bowel or lung resection;
  • aortic reconstruction;
  • cardiac valve surgery;
  • coronary bypass;
  • total hip or knee replacement, and
  • others.

With rare exceptions, no plan will pay for any of the following expenses and we do not cover them in our comparisons:

  • cosmetic or plastic surgery, except after accidents or a disfiguring illness;
  • custodial nursing home care, or any kind of rest care;
  • personal comfort items such as telephone or television while in the hospital;
  • non-prescription, over the counter drugs, such as aspirin;
  • care that is fully paid by another insurance provider;
  • care that is not medically necessary;
  • experimental care (clinical trials are partly excepted);
  • charges that are higher than the plan "allowance" or what the plan has determined to be "reasonable;" and
  • expenses incurred before joining or after leaving a plan.

All plans cover preventive exams without deductibles or copayments. Even among plans that cover all services generously, however, there are always some limitations, such as coinsurance and deductibles. Our tables take the major benefit limitations such as these into account in estimating costs. However, we cannot deal with every coverage nuance or difference (such as which organs are eligible for transplantation, or which "specialty drugs" are included in plan formularies). Nor can we assure that all plans will make identical medical necessity decisions in close cases—and they won't. Nor can we reflect extra benefits the plan may provide if, for example, it can save money by giving you more home nursing than its normal limitation on this benefit.

Hence, all of our calculations should be considered approximations or estimations that will be broadly accurate in the great majority of situations but that cannot provide precise predictions that cover every possible situation. What our calculations can do, and you cannot do for yourself even if you try to predict your costs, is take into account the risks of very high health care costs from an unexpected illness or accident and the likelihood of having such expenses.

I can't afford to pay much for deductibles and co-pays. Is there help for me in Vermont Health Connect for cost sharing and do you take this into account in your plan ratings?

If your income is between 150% and 30% of the federal poverty level, you can qualify for "cost sharing reductions" (CSRs). The CSRs reduce the deductibles, copays, and other cost sharing that would otherwise apply to covered services. And you also get the premium tax credit for CSR plans.

The cost sharing reductions are available through modified versions of silver plans. These plans have lower deductibles, copays, co-insurance, and out-of-pocket limits compared to regular Silver plans. If you are eligible for cost sharing reductions, we show you the appropriate plans and our ratings take this into account.

If I use my premium subsidy for a bronze plan, I can save even more money on the premium? Can I get also get my cost-sharing reduction through a bronze plan?

Sorry, you can only get cost sharing reductions by enrolling in a silver plan. There are no cost sharing reductions if you enroll in a bronze, gold, or platinum plan. This is a special saving, different from the rule for premium tax credit subsidies. You can apply premium tax credits to all four types of plan. However, if you are eligible for both kinds of help (that is, if your income is between 150% and 300% of the federal poverty level), you can receive both types of subsidies in a silver plan. An important value of our ratings is that they show you how much you are likely to spend, in total, for each of your plan options: bronze, silver, gold, etc.

Are there special cost sharing reductions (CSRs) for American Indians?

There are also two types of CSR available to American Indians enrolled in a U.S. federally recognized tribe:

  • Zero cost-sharing is available to those who are above 200% federal poverty level (FPL) but below 300% FPL. If these individuals enroll in a qualified health plan (QHP) through Vermont Health Connect they will have to pay premiums, but will not have to pay out-of-pocket costs (such as deductibles, co-pays and co-insurance) regardless of where they receive care.
  • Limited cost-sharing is available to those who are above 300% FPL but below 400% FPL. If these individuals enroll in a QHP through Vermont Health Connect they will have to pay for premiums and may have to pay cost-sharing if they get service outside of an I/T/U facility. IHS/Tribal Contract Health Services funds may pay for cost-sharing for CHS eligible American Indians if CHS rules are followed.

4. Calculation Methods and Data Used in this Tool

The underlying approach used in our Plan Comparison Tool is to compare plans in terms of their likely dollar cost to you, including both the "for sure" expense of the premium and the out-of-pocket (OOP) expenses you face for costs the plan does not pay. We estimate OOP expenses using actuarial methods juxtaposed against the cost-sharing details of each plan. Most of the analysis underlying the Plan Comparison Tool is aimed at quantifying, and expressing in terms of annual costs, the various risks you face and the reimbursement provided by each plan at each level of risk. We calculate costs assuming that you use only preferred providers, or providers who will agree to network fees, both because most consumers will avoid leaving the network if they can, and also because there is no realistic way to estimate the many unknown rates that individual providers may charge.

We calculate likely out-of-pocket costs, taking into account the probabilities of families of various sizes and ages incurring a wide range of expenses, from a zero cost year to a very high cost year for someone like the user. The low cost situation is most common but, when weighted for dollar amounts, accounts for a relatively small portion of statistically expected spending. Put in statistical terms, health care expenses are a highly "skewed" distribution, and the average (or "mean") is far higher than the typical (or "median") spending level.

Although most persons do not know whether they will incur large expenses or not—heart attacks, serious accidents, and most other costly scenarios are relatively unpredictable—some persons do have a pretty good idea of some future costs. For example, they may be planning major surgery for a congenital problem. We present data for both groups: persons with and without good information on next year's expenses and, for those with good prior information, estimated out-of-pocket expenses at several expense levels for each plan. We caution users, however, to beware of attempting to estimate the costs of "known usage" expenses for anything much beyond maintenance drugs. The problem is few are likely to know, and few to have access to, information on questions like the number of visits involved in dealing with a pinched nerve, or with the mix between hospital and surgical costs for a condition such as a knee or hip replacement. No one is likely to know if he or she will have a heart attack, a stroke, or a case of Lyme disease next year. Our methods do not force you to make guesses on this, or to pretend that the worst will not happen.

The percentage estimates for expenses of various amounts in the cost tables used in the Plan Comparison Tool are based on information taken from a number of sources. The most important of these is the Medical Expenditure Panel Survey (MEPS) of the Agency for Healthcare Research and Quality (AHRQ). This detailed survey produces information on what proportions of the population incur expenses at various dollar levels. We adjust MEPS data slightly to accommodate regional expense variations and medical inflation. Our cost tables also use rounded estimates to make them easier to read, and the cost headings represent ranges.

Because some plans impose different deductibles and coinsurance for different services, the distribution of costs between hospital and other expenses can affect significantly the amount that a plan will require you to pay for a particular expense total. We model our comparisons closely to average experience. Though few persons or families will have exactly the same cost profile as used in our tables, most situations will be at least close. Our profile, when weighted for probability, corresponds closely to projected expenses of the employed American population as a whole, both in total and in category of expense.

Our cost comparisons make several other simplifications.

  1. In analyzing most plans we have to make assumptions about the number of doctor visits and prescriptions to calculate the patient's share of expenses.
  2. We assume that all bills are for amounts negotiated between plans and preferred providers (often called the "plan allowance"). Plan allowances are for most plans the highest amount that the plan will cover. Many doctors who are not in the plan network charge more than the plan allows, and all plans do not have the same "profiles" for calculating their maximums. Absent any basis for adjustment, we simply assume what is generally true: all preferred doctors have agreed to limit their charges to plan allowances, and some others will agree to meet that level (or will do so if you tell them what plan you have and explain your cost concerns). There are instances in which some plans' schedules for some procedures are well below those used by other plans. Unfortunately, there is no way to adjust for this in our tables, though you can protect yourself in the real world by using preferred providers or by getting your provider to promise to stay within your plan's payment level before getting any expensive service.
  3. We assume that you take advantage of the best cost-sharing rate in each plan. Specifically, we assume that you get network rates by using network providers rather than providers who are not preferred with that plan. For drugs, we assume you use those in the plan formulary.
  4. We make assumptions about how many family members incur expenses at each total cost level in a year to calculate deductibles. For example, we assume that in a year with $1,000 in expenses, a family of five will have expenses for three members, and in a year with $130,000 in expenses, for all family members. In the real world, no one's actual set of yearly expenses will exactly match our assumptions. For plans whose coinsurance rates and deductibles are low or the same for most services, a different mix of expenses would have little or no effect on the cost estimates we present. For other plans, such as those with 100 percent coverage of hospitalization and limited coverage of prescription drugs, a different mix of expenses could change the estimates considerably. However, a different mix would not likely change any cost entry at $3,000 by more than two or three hundred dollars, or any entry for the $30,000 column by more than one or two thousand dollars. (Highly expensive specialty prescription drugs, such as AIDS drugs, hemophilia drugs, growth hormone drugs, some chemotherapy drugs, and some osteo-arthritis drugs are the most important potential exceptions.)

We apply our methodology consistently across plans, so that any estimating problem is likely to be small in its effects on the comparative information in the cost tables.

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