Almost 5 million people call Alabama home.1 Nearly half of the population gets health insurance coverage from their employers, and 36% get their coverage through Medicare or Medicaid. Approximately half a million lack health insurance coverage.2
If you’re one of the thousands without health insurance, you’re at major risk of sky-high medical bills and debt.
If you live in Alabama and are shopping around for a new policy, there are several insurance offerings available to you.
Health insurance options in Alabama
In Alabama, one in 10 residents lacks insurance, according to the Kaiser Family Foundation.3 The percentage of residents without insurance has decreased since the implementation of the Affordable Care Act (ACA). Between 2013 and 2016, the number of uninsured residents dropped by over 32% from 645,000 to 435,000.4
Unlike some other states — which have expanded Medicaid to include more low-income families — Alabama has not voted to expand Medicaid. Approximately 223,000 Alabamians are in the coverage gap and are unable to afford health insurance.5
Alabama is 14th in the country in terms of premium expense. The average monthly premium for health insurance is $669, or $8,028 per year.6
What kind of health insurance you can qualify for in Alabama depends on your age, income, and family size.
The Affordable Care Act
You can get coverage for you and your family through the federal Health Insurance Marketplace. In 2020, 160,249 Alabamans signed up for health plans through healthcare.gov during the Open Enrollment Period (OEP).7 That’s a decrease from 2019 when 166,128 people signed up for health insurance through the Health Insurance Marketplace.8
An ACA plan may make sense if your employer doesn’t offer insurance or if you have a pre-existing condition. Under the ACA, participating insurers can’t deny you based on your health history.
There are multiple tiers of coverage, ranging from Bronze to Platinum. Bronze plans have the cheapest premiums but pay the lowest percentage of covered care (60%). By contrast, platinum plans have the highest monthly premiums but pay the highest percentage of covered care (90%).
You can only enroll in a plan through the Health Insurance Marketplace during the OEP, which usually runs from November 1 through December 15.
If you need insurance outside of this period, you may be eligible for special enrollment if you experience a qualifying life event. Qualifying life events apply to people who left their jobs, got married, had a baby, or moved to a new location.
In 2020, a 40 year old would pay $553 for the second-lowest-cost silver (benchmark). That’s a $7 increase from 2019 when the benchmark plan cost $546.9
How much you’ll pay for your insurance is dependent on what tier you choose. The average marketplace premium by metal tier for 2018-2020 are as follows:10
|Average Lowest-Cost Bronze Premium||Average Lowest-Cost Silver Premium||Average Lowest-Cost Gold Premium|
If your income is low, you may be eligible for subsidies, such as the Advanced Premium Tax Credit, that make Marketplace plans more affordable. The subsidies can dramatically reduce your costs.
For example, the average cost of monthly insurance premiums in Alabama is $669 without subsidies. However, the average monthly premium with the Advanced Premium Tax Credit is just $123 per month — giving you a savings of $6,552 per year.11
List of Companies Offering Individual Health Insurance Plans in Alabama
The state has also experienced turnover among insurers offering plans under the Affordable Care Act (ACA). Previously, three companies offered plans: Humana, United Healthcare, and Blue Cross Blue Shield. But as of 2020, only Blue Cross Blue Shield and Bright Health remain.12
If you qualify for low-income status
If you are low-income, you can get affordable health insurance through the following options:
Government-funded health insurance
Medicaid: With a low income or disability, you may qualify for care through Medicaid. As of November 2019, about 750,000 Alabamans enrolled in Medicaid.13
You can qualify if your income is at or below 146% of the Federal Poverty Line. For a family of three, that means your income can’t exceed $2,643 per month.14
ALL Kids: ALL Kids is a low-cost coverage program for children under the age of 19. If your family meets its income restrictions, ALL Kids covers preventative care, sick child doctor visits, immunizations, and more. Your child must be a U.S. citizen or eligible immigrant, and not be covered by other insurance.15
As of November 2019, there were just over 173,000 children enrolled in ALL Kids.16
If you are over the age of 65, you are eligible for Medicare coverage. Most people get premium-free Medicare Part A. This version doesn’t have a premium as long as you or your spouse worked and paid Medicare taxes for a set period.
If you don’t qualify for premium-free Medicare Part A, you may want to buy into it. To do so, you’ll have to pay up to $458 per month.17
In Alabama, around 650,000 people are enrolled in Original Medicare, while about 390,000 are enrolled in Medicare Advantage Plans.18 An additional 365,124 state residents are enrolled in Medicare Part D — stand-alone prescription drug coverage.19
While Medicare is usually for people aged 65 or older, you may qualify for coverage under certain circumstances. If you’re entitled to Social Security benefits for at least 24 months, receive a disability pension from the Railroad Retirement Board, have Lou Gehrig’s disease, or have permanent kidney failure, you may qualify for Medicare. Generally, if you paid Medicare taxes for 10 years while working, you can qualify for Medicare Part A and not have to pay a monthly premium.
If you can’t afford your Medicare premiums, Alabama has some programs that may be able to help. If you meet specific income criteria, a portion of your premiums will be paid for by the state. For example, a couple who makes $1,457 per month or less can qualify for the Qualified Medicare Beneficiary Program, which covers the cost of Medicare premiums and deductibles.20 For more information or to apply, visit Medicaid.Alabama.gov.
Even if you qualify for Medicare, you may want to enroll in a Medicare Supplement policy, also known as Medigap. Original Medicare covers some, but not all, of your healthcare services and supplies. Medicare Supplemental insurance can help you with the remaining cost, including copayments and deductibles.21
Private companies offer Medicare Advantage. They’re bundled plans, combining Medicare Part A (hospital insurance) with Medicare Part B (Medical insurance) and usually include Medicare Part D (prescription drug coverage).
In Alabama, you have the option of signing up for a short-term insurance plan. Alabama defaults to federal regulations on short-term policies. In general, policies provide coverage for less than a year. They can be extended, sometimes for up to 36 months. However, they’re not required to cover essential health benefits, and people with pre-existing conditions can be denied coverage.
Because temporary insurance plans don’t comply with ACA, they often cost a fraction of what a plan on the Health Insurance Marketplace would cost. You’ll still get coverage against major issues, but the monthly expense will be much lower.
Previously, there was a penalty if you didn’t have an insurance plan that met the ACA’s requirements. However, the penalty was eliminated starting with the 2019 tax year, so there’s no penalty for opting for short-term insurance over an ACA-compliant plan.
If you are unemployed
If you lost your job, you could qualify for health insurance through the Health Insurance Marketplace. Without steady income, you’ll likely qualify for a subsidy and qualify for a low-cost plan.
Or, you can sign up for a short-term health insurance plan to give you coverage until you find a new job, and your employer’s insurance policy kicks in.
If you are in between jobs
If you left your job or were laid off and have a new role lined up, you may need coverage until your new employer’s insurance goes into effect. If that’s the case, you have three options:
When you leave your job, your employer will send you information about the Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage. Through COBRA, you can maintain your current coverage for up to 18 months. However, you’ll have to pay the entire premium yourself, which can be extremely costly.
Getting health insurance
As a resident of Alabama, you have several health insurance options to choose from if you still need to sign up for coverage. Even if you have special circumstances, such as a disability or low income, you can find an affordable policy that works for you.
If you need help finding a policy that fits your needs, you can compare over 4,000 health plans online to select the best policy for your budget.