Buy coverage on HealthCare.gov or your state's own marketplace during open enrolment each autumn, or within 60 days of a qualifying life event such as losing coverage, moving, marriage or a birth. When you apply, the Marketplace calculates whether you qualify for a premium tax credit to lower your monthly premium and, for lower incomes, cost-sharing reductions that cut deductibles - available only on Silver plans.
How it works
The short version, before the detail.
The Marketplace - sometimes called the exchange - is a regulated market of private health plans. Every plan must cover the ten essential health benefits, including doctor visits, hospital stays, emergencies, maternity and newborn care, mental health and substance use treatment, prescriptions, lab tests, preventive care and children's dental and vision. Insurers cannot refuse you or charge more for a pre-existing condition.
Plans are grouped into metal levels - Bronze, Silver, Gold and Platinum - which reflect how costs are shared, not the quality of care. Bronze plans have the lowest premiums and highest out-of-pocket costs; Platinum the reverse. Some people under 30 or with a hardship exemption can buy catastrophic plans.
Premium tax credits are what make Marketplace coverage affordable. They are calculated from your expected household income for the coming year and the cost of a benchmark Silver plan in your area. You can take the credit in advance to lower your monthly premium, or claim it when you file taxes. If your income changes during the year, update the Marketplace, because the advance credit is reconciled on your tax return. The size and income range of these credits has changed in recent years as temporary enhancements were enacted and expired, so always check the current figures on HealthCare.gov rather than relying on what a friend paid in a previous year.
Cost-sharing reductions are a second, separate subsidy for lower-income enrollees. They lower deductibles, copays and the out-of-pocket maximum - but only if you choose a Silver plan. For people who qualify, a Silver plan with cost-sharing reductions can have far lower costs than the Bronze plan with the cheapest premium.
Free help is available. Navigators and certified application counsellors are trained, unbiased helpers funded to assist people in choosing and enrolling at no cost. Licensed agents and brokers can also enrol you; they are paid by insurers, not you, but make sure you are dealing with a legitimate agent and never let anyone enrol you without your consent.
Who usually qualifies
Factors the agency looks at. Only they make the final decision.
If your employer offers coverage, whether you can get a tax credit depends on whether that offer is affordable and meets minimum value. The Marketplace application asks about it.
How to apply, step by step
Check the dates
Open enrolment usually runs from early November into January on HealthCare.gov, with some state marketplaces running longer. Outside that window you need a qualifying life event and 60 days to enrol, though Medicaid and CHIP accept applications all year.
Estimate your income for the year ahead
Subsidies are based on expected annual household income, not last year's. Include wages, self-employment profit, unemployment and other taxable income. Your best honest estimate is fine; you can update it.
Create an account and apply
Apply at HealthCare.gov or your state's marketplace, or by phone. The application checks everyone in your household for Medicaid, CHIP and tax credits at once.
Compare plans by total cost, not just premium
Look at the deductible, copays, out-of-pocket maximum, whether your doctors and hospitals are in the network, and whether your prescriptions are covered. If you qualify for cost-sharing reductions, compare Silver plans especially carefully.
Decide how to take the tax credit
Most people take it in advance to lower monthly premiums. Taking all of it in advance means you must report changes to avoid repaying some at tax time.
Pay the first premium
Coverage does not start until the first payment is made. Pay by the insurer's deadline.
Report changes during the year
Update income, household size and address. Changes can increase your credit or prevent an unexpected tax bill.
What to have ready
Missing one item is rarely a reason to wait - start now.
- Social Security numbers or immigration documents for applicants
- Expected household income for the year - pay stubs, W-2s, recent tax return
- Information about any job-based coverage offered, including cost
- Current health plan details, if you have one
- A list of your doctors and prescriptions to check networks and formularies
What happens after you apply
How it compares
Similar programmes, and which one fits which need.
| Programme | What it covers | Best for |
|---|---|---|
| ACA Marketplace | Private plans with income-based subsidies | People without affordable job-based coverage |
| Medicaid | Free or very low-cost full health coverage | Low-income adults, children, pregnancy, disability |
| Employer coverage | Job-based insurance | People with an affordable work offer |
| COBRA | Keep former job's plan, usually at full cost | Short gaps when the old network is essential |
Real situations
How this plays out for people in common circumstances.
Freelancer with a variable income
A graphic designer earns different amounts each year. She assumes Marketplace plans are unaffordable after seeing the full prices.
She enters her best estimate of next year's income and sees a substantial premium tax credit. She updates her income in the summer when a big contract comes in, so her credit adjusts and she avoids a large repayment at tax time.
Lower income, choosing Bronze by mistake
A man picks the cheapest Bronze plan without noticing he qualifies for cost-sharing reductions.
A navigator shows him a Silver plan with cost-sharing reductions that costs a little more per month but has a far lower deductible, which matters because he takes regular medication.
Lost job-based coverage in March
A family loses coverage when a parent's job ends.
Losing coverage triggers a 60-day Special Enrollment Period. They apply within the window and are also screened for Medicaid.
Employer family coverage too expensive
A worker's employer offers affordable coverage for her but family coverage is very expensive.
Under the corrected family glitch rules, her spouse and children may qualify for tax credits on the Marketplace even though she takes the job plan.
What people miss
True, rarely explained, and it changes the outcome.
The listed price is usually not your price
Premium tax credits often reduce the premium dramatically. Always apply to see your subsidised price.
Silver can beat Bronze for lower incomes
Cost-sharing reductions only attach to Silver plans and can make them much cheaper to use.
Update your income during the year
Advance credits are reconciled at tax time. Reporting changes prevents surprise bills - or gets you a bigger credit if income drops.
Navigators are free and unbiased
Use them rather than websites that collect your details for sales calls.
Medicaid and CHIP never close
If your income is low, you can apply for them any day, even outside open enrolment.
Common reasons people get stuck
Comparing premiums only
Total cost includes deductibles and copays. Check networks and drug coverage too.
Missing the first payment
No payment means no coverage.
Not reporting income changes
Can create a large tax bill.
Letting an unknown agent enrol you
Unauthorised enrolments and plan switches are a real scam. Only work with people you contacted.
Missing the Special Enrollment window
You usually have 60 days from the event.
How it differs by state
Most states use HealthCare.gov; others run their own marketplaces with their own website, deadlines and sometimes extra state subsidies. Plan choices and prices differ by county. Your state may also have its own individual mandate or additional help.
Key terms explained
The words on forms and letters, in plain English.
- Marketplace
- HealthCare.gov or your state's exchange for buying private health plans.
- Premium tax credit
- An income-based subsidy that lowers your monthly premium.
- Cost-sharing reductions
- Extra savings on deductibles and copays, available only on Silver plans.
- Metal levels
- Bronze, Silver, Gold and Platinum - how costs are shared between you and the plan.
- Deductible
- What you pay for covered care before the plan starts paying.
- Navigator
- A free, trained helper who assists with Marketplace enrolment.
Questions people ask
How do I sign up for Obamacare?
When is open enrolment for health insurance?
How much will Marketplace insurance cost me?
What is a premium tax credit?
What are cost-sharing reductions?
Can I get Marketplace insurance outside open enrolment?
Can I get a tax credit if my employer offers insurance?
What happens if my income changes during the year?
Do I have to pay back the premium tax credit?
Can I keep my doctor on a Marketplace plan?
Are pre-existing conditions covered?
Who can help me choose a plan for free?
Can immigrants buy Marketplace insurance?
What is the difference between Bronze, Silver and Gold?
Numbers to call
Free lines. We are not affiliated with any of them.
Official sources
Current figures and applications live here.