Americans who are not eligible for any of the government based programs like Medicare, Medicaid, or CHIP can get coverage only through private health insurance providers. Private health insurance is not a state or federal government programs. Instead, these plans are designed by private entities like an insurance company or broker. Individuals who are not offered health plans by their employer can avail of these plans through federal or state marketplace plans or licensed brokers or agents because state exchanges and federal exchange offer both public and private health insurance plans.
On-exchange private individual and family health plans offered by the government-run exchanges are required to cover the ten essential benefits along with any additional services that are mandated by the state government. Off-exchange private individual health plans are either directly sold by the health insurance company, or through a third-party broker, or a privately-run health insurance marketplace. These plans should also cover the ten essential benefits and should also follow the rules dictated by the Affordable Care Act. This is done to ensure people that they can purchase off-exchange private health plans without any doubt and apprehension. The only caveat with the off-exchange plans is that no subsidies like premium tax credit or cost-sharing reductions apply to these plans. who all will Need Private Health Insurance Plans
Private individual health insurance becomes essential for the following individuals:
A young individual of 26 years of age or older – As per the Affordable Care Act, children can stay on their parents’ health insurance plan until they are 26 years old. After this, they will require to purchase their health plan.
Unemployed – Individuals who have lost their job and are unable to continue with their employer’s health insurance plan under COBRA due to its exorbitant price can buy some less expensive private health plan.
Part-time Employee – Part-time employees are rarely offered health benefits by their employers, so all the part-time workers will need to purchase their own private individual health plans.
Self-employed – Individuals who work for themselves or are self-employed need to purchase their own private individual health plan. They can only skip buying a health plan if they are covered under a spouse or partner plan.
Retired People – Individuals who retire from their job no longer remain eligible for employer-sponsored health insurance plans, so they need to purchase their health plan. Even if the retired individual is under 65 years of age and is not disabled, he will need a private individual health plan until they turn 65 and can apply for Medicare. However, even after signing-up for Medicare retirees still purchase private Medigap or Medicare Advantage plans to supplement or replace Medicare coverage.
Dropped by the existing insurer – However, the ACA has prevented insurers from canceling or denying coverage to any individual for a pre-existing condition or a mistake on their application, but there might be some other circumstances when one’s coverage can get canceled or become expensive to afford. Thus, in such situations, individuals need to buy their private health plans.