American University provides faculty and staff with a choice of health insurance coverage, and if you are eligible, we pay a significant portion of the premium. The two health insurance plan options are CareFirst BCBS Blue Choice Advantage (point-of-service) and Kaiser Permanente (HMO). A new law requires us to provide you with this notice describing Health Insurance Exchanges, but keep in mind that this information does not affect your health insurance coverage under the university’s group health plan.
What’s a Health Insurance Exchange?
Beginning January 1, 2014, individuals may purchase health insurance coverage through a Health Insurance Exchange. Exchanges have different names in different States. To locate the Exchange in your State, visit www.healthcare.gov.
Why would people buy coverage through an Exchange?
People might purchase health insurance coverage through an Exchange if they don’t have coverage from another source – for example, a person might be unemployed or might work for an employer that doesn’t offer health insurance coverage. Certain individuals will qualify for a premium tax credit if they purchase health insurance coverage through an Exchange.
How do I know if I’m eligible for the premium tax credit?
Eligibility for the premium tax credit is based on several complex factors: your household income must be between 100 percent and 400 percent of the federal poverty line; you must not be eligible for governmental health insurance coverage (such as Medicare, Medicaid or VA benefits); you must not be eligible for employer health insurance coverage that is adequate and affordable; and you must not be enrolled in employer health insurance coverage, regardless of whether that coverage is adequate and affordable.
Does the AU health plan provide adequate and affordable coverage?
Yes, with two consequences. First, if you are eligible to participate in the university’s group health plan, you are NOT eligible for premium tax credits. Second, if you are not eligible to participate in the university’s group health plan, you MAY be eligible for premium tax credits – in this case you should check with the Exchange to determine whether you qualify for premium tax credits.
What are the trade-offs between the university’s health plan coverage vs. Exchange coverage?
The health insurance coverage offered through the university’s health plan is group coverage, and premiums are not based on your age. We subsidize your health insurance coverage, and you pay your share of the premium on a pre-tax basis. Health insurance coverage purchased through an Exchange is individual coverage, and premiums are based on your age. We do not subsidize Exchange coverage, and your premiums for Exchange coverage are paid on an after-tax basis.