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How to Buy Across State Lines: Can You Actually Save Money on Insurance?

Are you looking for ways to save money on your health insurance?

Have you heard about buying health insurance across state lines to save money?

Are you wondering how to buy across state lines and if it’s something you can even do?

Buying health insurance across state lines can be tricky, but that doesn’t mean it’s impossible. This blog covers some of the basics of buying health insurance across state lines in addition to reasons why it may not be the best idea for you and your family.

Continue reading to see if you or your family qualify to buy health insurance across state lines, how you can buy across state lines, and learn other ways you can save money on health coverage under the Affordable Care Act.

Saving Money by Buying Health Insurance Across State Lines

Everyone wants to save money on their health insurance. That’s why it can be tempting to look into health coverage from out-of-state providers.

But where did this idea come from, that health insurance can be less expensive when purchased across state lines?

Is this some new idea to get more people covered through the Affordable Care Act?

The truth is, it’s been around for almost two decades. In the 1990s, people who advocated for selling health insurance across state lines argued that it would make insurance less expensive. By selling plans in multiple states, but operating by the rules of one state, insurance providers could reduce the costs of plans.

Contact Fiorella Insurance Agency today to see how we can help you with your health insurance needs.

The idea was recently reiterated by President Donald Trump, who said that premiums would be down 60-70% if insurers could sell coverage across state lines. Though there is no data provided to back up that claim, the myth still persists. People continue looking for ways to save money by finding how to buy insurance across state lines.  First, let’s make sure we understand what the Affordable Care Act is.

What is the Affordable Care Act.

The Patient Protection and  Affordable Care Act, provides for the establishment of a regulatory framework that allows two or more states to enter into a Health Care Choice Compact to facilitate the sale of health insurance coverage across state lines. It was formally signed into law on March 23rd, 2010 by President Obama.  It was the largest change initiated by the federal government to the United States Healthcare system in history.  The Department of Health and Human Services is primarily responsible for its implementation, though many other U.S. cabinet level agencies also have a role, such as the IRS, the Social Security Administration and even the FDA.


How to Buy Across Health Care Coverage Across State Lines: A Health Insurance Primer

Because the myth persists that buying across state borders can save people money, there is a quest for this ultimate unicorn solution.

The reality is a little bleaker, however. Only six states sell insurance across state lines:

  • Georgia
  • Kentucky
  • Maine
  • Rhode Island
  • Washington
  • Wyoming

But of those six states, none of them have had a new insurance provider move into the state to sell plans across state lines.

A Fiorella Insurance Agent can help you choose insurance plan and insurance company that’s right for you.

Basically, there’s no way to know if you can really save money through the marketplace by buying insurance across state lines.  One of the reasons this is as complicated as it is comes down to the fact it is governed by the Interstate Commerce Clause.  The U.S. Constitution was designed to promote interstate commerce, but Congress acted in 1945 to artificially fragment insurance markets state by state.  

You Have Other Options

There are other options, however, like finding out if your insurance provider covers you across state lines. If you travel frequently, you may look into this as a factor when comparing insurance plans.  There are health plans available for truck drivers, pilots, bus drivers and many other others who work across state lines and face significant risk of needing health care while out of their normal network.

Because the Affordable Care Act offers lower premiums through limited service areas, covering all states and situations would be counterproductive.  The United States Government via federal law, has to to find solutions that work everywhere, this complicates the situation considerably.

Multi-State Plans

Another option is a Multi-State Plan (MSP), offered through the marketplace by private insurance providers. These may offer coverage across state lines, but some still restrict your coverage areas. They may not even cover out-of-state services, so make sure to ask the right questions.

3 Reasons Buying Insurance Across State Lines Might Not Be A Good Idea

While some people will absolutely need a plan that covers them across state lines, it may not be the best fit for every family. And it may not be the best fit overall, though it is hard to know without testing it. Here are three reasons buying health insurance across state lines may not be the best idea:

1. Multi-State Health Insurance Plans may not cover out-of-state services.

The likelihood that MSPs will cover all out-of-state services in all states is very slim. The cost of healthcare is too high in some states for other states’ providers to consider covering.

It’s important to do some research on the available plans if you really need to go this route. An agency may be able to help you choose the best plans for healthcare across state lines.

2.  Evolving legislation could make them more expensive for certain people.

When insurance companies do start selling insurance across state lines, there’s a good chance you may see your premiums skyrocket. Insurance discounts are hard to acquire at a national level.

This may also mean that insurance companies can effectively price out people they don’t want to cover, meaning people with preexisting conditions.

3. Premiums may be higher, as will your out-of-pocket costs.

Private insurers offer MSPs. Just because the marketplace offers them doesn’t mean they will be less expensive than going through an agency for your out-of-state needs.

You will pay out-of-pocket for any services your insurance provider doesn’t cover. This means you need to have a savings plan in case your provider doesn’t cover any out-of-state illnesses or injuries.

Other Ways to Save Money on Health Insurance

If insurance coverage when traveling is your goal, you may need to consider a Multi-State Plan. If saving money on healthcare is your primary goal, there are some other ways to make that happen.

Three ways to save money on healthcare are:

  • Plan your healthcare carefully: Make a list of how often you expect to visit the doctor, what prescriptions you normally get filled, etc. and see how much it will cost on each plan.
  • Take advantage of discounts and savings cards: Prescriptions can be costly, so take advantage of any discounts you can get through third-parties or use savings cards provided by your doctor.
  • See if you qualify for premium tax credits: Depending on your income, you may qualify for tax credits to make your premiums more affordable.  

And if you don’t qualify for tax credits, there may be other ways to save. A Fiorella Insurance agent may be able to connect you with plans that are more suitable for your budget. They may also be able to connect you with potential out-of-state options for coverage. Just make sure to ask all the right questions when comparing insurance plans.

Still looking for out-of-state options or additional savings? Contact Fiorella Insurance Agency today to see how we can help you with your health insurance needs.

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