The Affordable Care Act helps create a competitive private health insurance market through the creation of Health Insurance Marketplaces, also referred to as a Health Insurance Exchange. An Exchange is an online tool for the health insurance marketplace to help consumers shop for healthcare coverage. An Exchange may be operated by a government entity, or by a private entity such as an insurance agency or association. Both have the same core components, however, the government run program requires that certain eligibility requirements be met.
To ensure all Americans have access to quality, affordable healthcare, the Federal Government offers a subsidized program that will offer individuals and families premium assistance towards all or a portion of the cost of a Qualified Health Plan. Eligibility for the subsidy is based on many factors including household size and income, residency and access to coverage through an employer. Eligibility guidelines also determine subsidy payment based on where individuals and families fall relative to the Federal Poverty Level (FPL). The Public Exchange allows eligible individuals to purchase Qualified Health Plans (QHP) coverage directly on the public exchange. Tax credit incentives are also available to those who qualify. Prior to purchasing coverage on a Private Exchange, consumers should check subsidy eligibility on the Public Exchange.
Private Exchange (i.e. Texas Bar Private Insurance Exchange)
A Private Exchange offers a consumer-friendly approach to purchasing health insurance coverage. Individuals that do not qualify for a government subsidy may purchase a QHP on a Private Exchange. Plans available on the Public Exchange must also be available on a Private Exchange. Private Exchanges provide consumers with one-stop shopping for affordable medical coverage and additional coverages like dental, vision, life, disability, accident, and more. Consumers may view plans from a variety of insurance carriers, compare benefits and costs and make purchasing decisions based on their specific health needs and budget.