The Affordable Care Act gives everyone more healthcare options, including people like you who get coverage through work. The new online marketplace for comparing plans is open to most everyone, and you always have the option to decline coverage at work and purchase a plan through the marketplace, a health insurance carrier, or an independent agent. Employees who feel workplace healthcare premiums are costly may be considering the alternatives. If you can shop around and can no longer be turned down for coverage because of age or illness, does it make sense to stick with your employer’s plan?
Employer coverage can be a cost-effective option, depending on the plan, the benefits, the needs of you and your family, how much your employer contributes, your potential to receive tax credits, and so on. Here are some things to consider when comparing your coverage through work with outside health plans.
Employer plans are partially paid for by the employer
One big advantage to employer coverage is that someone else is usually chipping in to pay the bill. In one 2013 survey by the Kaiser Family Foundation, employers who responded said they pay, on average, more than three times as much for an employee’s plan than the employee does. If you purchase a plan on your own or through the marketplace, you may be paying the entire premium yourself.
If you decline employer coverage, you may not qualify for tax credits
People who make less than 400% of the poverty level (about $45,960 for an individual, $94,200 for a family of four in 2013) may qualify for advance premium tax credits to help pay the premiums of individual plans bought on a marketplace. But if your employer offers health coverage that meets the standards of the Affordable Care Act and you opt for the marketplace instead, you may not qualify for these credits. Ask your employer for more details about your eligibility.
Employer plans are kept affordable
Healthcare coverage offered by large employers must be “affordable” and meet a minimum value under the Affordable Care Act. That doesn’t mean that the cost of your plan will go down—in fact, your plan may include increased deductibles, copays, and other out-of-pocket costs in the wake of the new law.
Your portion of healthcare premiums should not exceed 9.5% of the annual income you receive from your employer. Also under the new law, employer plans meet a certain minimum value, meaning yours should cover at least 60% of the cost of medical services.
Employer plans are paid pre-tax
There are also tax benefits to being in your employer’s plan. Health premiums through your work health plan likely are paid through your paycheck and are paid pre-tax. If you choose a marketplace plan, you’ll pay for it with after-tax dollars.
Employer plans may include voluntary benefits
Employer plans often come with add-on options, known as voluntary benefits. You can add dental, vision, or supplemental coverage to your workplace benefits. They are usually offered at a price that’s lower than what you would pay for an individual plan.
Still, whether you should always take employer benefits depends on your individual situation. Get as much information as you can from your employer about your existing plan and then do the comparison yourself. You can visit the marketplace or a company like Humana to compare annual premiums, deductibles, out-of-pocket costs and additional benefits. You should also determine your eligibility for tax credits. Armed with this information, you will be able to make a decision that’s right for you.
Source:  http://kff.org/private-insurance/report/2013-employer-health-benefits/ https://www.healthcare.gov/what-if-i-have-job-based-health-insurance/ Kff.org http://www.xeniumhr.com/blog/hr/benefits-hr/are-voluntary-benefits-at-work-an-added-value-to-employees/#.Un1Q4pRAQeU
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This information is only a high-level summary of certain provisions of the health care law. This information does NOT attempt to summarize all provisions of the health care reform law. This information is not and should NOT be used as legal or tax advice; it should not be used as a basis for decisions regarding how the health care reform law will affect you and/or your business. Should you have any questions on how the health care reform law (including the high level summary of certain provisions of health care reform) will affect you and/or your business, you should seek professional advice from attorneys or other advisors.
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