Key Takeaways
- The ACA requires all marketplace plans to cover 10 essential health benefits including hospitalization, prescription drugs, and preventive services
- Open enrollment for 2026 coverage runs November 1, 2025 through January 15, 2026 in most states
- Special Enrollment Periods (SEPs) allow enrollment outside open enrollment when qualifying life events occur—most provide 60 days to enroll
- Premium Tax Credits are available for households with income between 100% and 400% of the Federal Poverty Level (FPL)
- The ACA prohibits denying coverage or charging more based on pre-existing conditions (guaranteed issue)
Health Insurance Fundamentals
Health insurance is a critical component of financial planning, protecting clients from catastrophic medical expenses that can devastate even well-prepared families. The Affordable Care Act (ACA), enacted in 2010, transformed the individual health insurance market by establishing minimum coverage standards, creating Health Insurance Marketplaces, and providing subsidies to make coverage more affordable.
The Affordable Care Act Framework
The ACA established several foundational requirements that apply to all qualified health plans sold in the individual and small group markets:
Essential Health Benefits (EHB)
All ACA-compliant plans must cover 10 essential health benefit categories:
| Category | What's Covered |
|---|---|
| Ambulatory patient services | Outpatient care without hospital admission |
| Emergency services | ER visits regardless of network status |
| Hospitalization | Inpatient care, surgery, overnight stays |
| Maternity and newborn care | Prenatal, delivery, and postnatal care |
| Mental health and substance use | Behavioral health, counseling, rehab |
| Prescription drugs | At least one drug per therapeutic category |
| Rehabilitative services | Physical therapy, occupational therapy |
| Laboratory services | Blood tests, diagnostic imaging |
| Preventive and wellness | Immunizations, screenings, counseling |
| Pediatric services | Dental and vision for children under 19 |
Key Point: States can modify EHB benchmark plans. For 2026, Alaska, Washington, and DC have revised their EHB benchmark plans with new coverage requirements.
Consumer Protections
The ACA established critical protections that apply regardless of where you purchase coverage:
- Guaranteed Issue — Insurers must accept all applicants regardless of health status
- No Pre-existing Condition Exclusions — Cannot deny coverage or charge more based on health history
- No Lifetime or Annual Limits — Plans cannot cap total benefits paid
- Dependent Coverage to Age 26 — Children can remain on parents' plans regardless of student status, marriage, or financial dependence
- Rating Restrictions — Premiums can only vary based on age (up to 3:1 ratio), tobacco use, family size, and geographic area
Open Enrollment and Special Enrollment Periods
Open Enrollment Period (OEP)
The Open Enrollment Period is the annual window when anyone can enroll in or change Marketplace health insurance plans without qualifying for a special enrollment period.
2026 Coverage Open Enrollment Dates:
| Deadline | Action |
|---|---|
| November 1, 2025 | Open enrollment begins |
| December 15, 2025 | Last day to enroll for January 1, 2026 coverage |
| January 15, 2026 | Open enrollment ends in most states |
| January 31, 2026 | Extended deadline in California and some state-based marketplaces |
Important Change for 2027: Starting in fall 2026, open enrollment will end December 15 in most states and cannot extend past December 31 in any state.
Special Enrollment Periods (SEPs)
Special Enrollment Periods allow enrollment outside of open enrollment when a qualifying life event (QLE) occurs. Most SEPs provide 60 days to enroll from the date of the qualifying event (90 days for Medicaid/CHIP loss in most states).
Common Qualifying Life Events:
| Category | Examples |
|---|---|
| Loss of Coverage | Job loss, COBRA ending, aging off parent's plan at 26, divorce |
| Family Changes | Marriage, birth, adoption, death of covered family member |
| Relocation | Moving to a new ZIP code or county with different plan options |
| Income Changes | Income decrease making you newly eligible for subsidies |
| Other | Gaining citizenship, release from incarceration, ICHRA/QSEHRA offer |
2026 Changes to SEPs:
- Stricter verification requirements—at least 75% of SEP enrollments will require documentation
- The low-income SEP (for those at or below 150% FPL) was discontinued effective August 25, 2025
- Some states (Illinois, Virginia, California) are adding pregnancy as a qualifying event
Premium Tax Credits and Subsidies
The ACA provides Premium Tax Credits (PTCs) to help eligible individuals and families afford Marketplace coverage. These subsidies reduce monthly premium costs based on household income.
Income Eligibility
| Income Level (% of FPL) | 2025 (Enhanced Credits) | 2026 (Standard Credits) |
|---|---|---|
| 100-150% FPL | 0% of income for benchmark plan | 2% of income for benchmark plan |
| 150-200% FPL | 0-2% of income | 3-4% of income |
| 200-300% FPL | 2-6% of income | 4-6.6% of income |
| 300-400% FPL | 6-8.5% of income | 6.6-9.96% of income |
| Above 400% FPL | 8.5% cap applies | No subsidies available |
2026 Federal Poverty Level Thresholds (Approximate):
| Household Size | 100% FPL | 400% FPL (Subsidy Cliff) |
|---|---|---|
| 1 person | ~$15,650 | ~$62,600 |
| 2 people | ~$21,150 | ~$84,600 |
| 4 people | ~$32,150 | ~$128,600 |
Critical Planning Point: The enhanced premium tax credits established during COVID are set to expire at the end of 2025. Without legislative extension, premiums for Marketplace coverage could increase an average of 114% in 2026, and approximately 4 million people may lose coverage.
Cost-Sharing Reductions (CSRs)
In addition to premium subsidies, individuals with household income between 100% and 250% of FPL may qualify for Cost-Sharing Reductions that lower out-of-pocket costs (deductibles, copays, coinsurance) on Silver-tier plans.
Marketplace Metal Tiers
ACA Marketplace plans are categorized into four metal tiers based on actuarial value—the percentage of average healthcare costs the plan pays:
| Tier | Actuarial Value | Premium | Out-of-Pocket Costs | Best For |
|---|---|---|---|---|
| Bronze | 60% | Lowest | Highest | Healthy individuals, HSA-eligible |
| Silver | 70% | Moderate | Moderate | CSR-eligible individuals (100-250% FPL) |
| Gold | 80% | Higher | Lower | Frequent healthcare users |
| Platinum | 90% | Highest | Lowest | High healthcare needs, predictable costs |
Maximum Out-of-Pocket Limits (2025 vs. 2026):
| Coverage Type | 2025 | 2026 |
|---|---|---|
| Individual | $9,200 | $9,450 |
| Family | $18,400 | $18,900 |
COBRA Continuation Coverage
COBRA (Consolidated Omnibus Budget Reconciliation Act) allows employees and dependents to continue group health coverage after certain qualifying events. Key provisions:
- Applies to employers with 20 or more employees
- Coverage available for 18 months (reduction in hours, termination)
- Coverage available for 36 months (death, divorce, Medicare eligibility, loss of dependent status)
- Up to 29 months if disabled under Social Security definition
- Employer may charge 102% of premium (2% administrative fee)
- 60-day election period from later of qualifying event or notice
On the CFP Exam
Expect questions testing:
- Essential health benefit categories and consumer protections
- Open enrollment vs. special enrollment period timing
- Qualifying life events that trigger SEPs
- Premium tax credit eligibility based on income
- COBRA coverage periods for different qualifying events
- Metal tier actuarial values and appropriate plan selection
Sarah lost her job on March 15 and wants to enroll in an ACA Marketplace plan. Which statement is TRUE about her enrollment options?
Which of the following is NOT one of the 10 essential health benefits required under the ACA?
A married couple with no children has a household income of $90,000. Based on 2026 subsidy rules (assuming enhanced credits expire), which statement is most accurate?