Obamacare: Health Insurance Marketplace Overview

The Affordable Care Act ( or "ACA"), commonly known as "Obamacare," has provided health insurance to millions of Americans since its enactment. If you're considering purchasing health insurance through the Health Insurance Marketplace or have questions about your coverage options, this article answers the most frequently asked questions.

What Is Obamacare?

Again, the Affordable Care Act, which is the healthcare reform law enacted in 2010 that expanded health insurance coverage and implemented reforms to the health insurance market is commonly known as "Obamacare."

What Is the Health Insurance Marketplace?

The federal Health Insurance Marketplace, which is also called the "Marketplace" or "Exchange," is the website where individuals can browse various health care plans available under the Affordable Care Act, as well as compare them, and purchase health insurance. Some states, like California, offer their own Marketplace. If your state isn't offering its own Marketplace, you can use the federal Marketplace.

The health insurance plans are offered by private companies but are all required to offer all essential health benefits, such as hospital care, outpatient services, emergency services, maternity care, mental health and substance abuse treatment, prescription drug coverage, lab services, and rehabilitative services.

How Can I Enroll in a Health Care Plan?

Generally, you have to enroll during the Open Enrollment Period. However, you might qualify for a Special Enrollment Period if you've gone through a major life event like losing other coverage, getting married, or having a baby.

What Is a Premium Tax Credit?

A "premium tax credit" is a credit you can use to lower your monthly insurance payment when you enroll in a plan through the Marketplace. As originally designed, the premium tax credit was only for low- and moderate-income people whose household income was between 100% and 400% of the federal poverty level (FPL). However, Congress removed the 400% of FPL limit for 2021 through 2025.

From 2021 through 2025, Americans who earn over 400% of the federal poverty level don't have to pay more than 8.5% of their household income for Obamacare health insurance. No matter how high your income is, you can get a premium tax credit to the extent the cost of the silver benchmark plan in your area exceeds 8.5% of your household income. Those with incomes under 400% of the federal poverty level are required to pay less than 8.5% of their income for health insurance, based on a sliding scale.

As of November 2025, these enhanced premium tax credits, which have provided this 8.5% income cap for all earners and reduced costs for lower-income individuals, are scheduled to expire on December 31, 2025. If the enhanced subsidies aren't extended, the original pre-2021 rules will return in 2026, meaning the 400% federal poverty level income cap will be reinstated, and Americans earning over that threshold will lose all eligibility for subsidies. For those earning under 400% of FPL, the subsidy amounts will be significantly reduced. The funding deal that Congress passed and the president signed on November 12, 2025, to end the government shutdown only guarantees a Senate vote on the subsidies in mid-December 2025, with no assurance that an extension will pass. A recent Kaiser Family Foundation report estimated that premiums for subsidized enrollees would more than double on average (increasing 114%) in 2026 if the enhanced subsidies expire. This could result in approximately 4 million additional Americans becoming uninsured, according to the Urban Institute.

If you are offered health coverage through your employer, you can purchase a policy through the Health Care Marketplace, but you are eligible for subsidies only if your employer-provided insurance isn't affordable based on certain criteria. If you don't qualify for your employer's insurance because you work part-time, you can get health coverage through the Marketplace.

Are There Different Plans Available Through the Health Insurance Marketplace?

The four different categories of insurance plans available through the Marketplace are Platinum, Gold, Silver, and Bronze. All of the categories' plans provide the same essential health benefits. The quality of care provided, or the access to doctors, doesn't vary between plan types. The various categories differ by the types and amount of costs you'll pay.

A Platinum plan's premium is the highest, but you'll have lower out-of-pocket costs, like copays for visiting the doctor and for prescription drugs. A Bronze plan's premiums are the lowest, but you'll have higher out-of-pocket costs. The Gold and Silver plans are in between.

What If I Have a Preexisting Condition?

A preexisting condition won't keep you from getting health coverage. As of January 1, 2014, no insurance company can exclude you from coverage because you have a chronic or disabling illness or injury or because you've received recent treatment for a medical condition. An insurance company also can't charge you more if you have a preexisting condition.

Do I Have to Pay a Penalty Under the ACA If I'm Uninsured?

The individual mandate that required individuals to maintain a basic level of health insurance or pay a penalty is in effect, but the penalty has been reduced to $0. The tax penalty was eliminated after the end of 2018, under the terms of the Tax Cuts and Jobs Act of 2017.

What If I'm Pregnant and Want to Buy a Marketplace Plan?

Under the Affordable Care Act, preexisting conditions are covered, including pregnancy. Maternity care and childbirth are considered essential health benefits, which means all Marketplace health plans must cover them, even if you were pregnant before your coverage begins.

Some older individual health plans, however, don't have to cover pregnancy and childbirth. (An individual health plan is a plan you buy yourself, not the kind you get through your job.)

What If I Work Part-Time and Want to Buy a Marketplace Plan?

If you work part-time and can't get coverage from your employer, you can purchase a plan through the Marketplace. Depending on your income level, you might be eligible for a lower policy premium.

However, if you can get health coverage from your employer, you can still buy insurance through the Marketplace. But you might not qualify for a premium tax credit and other savings based on your income.

What If I Lose My Group Insurance Through My Job?

If you lose your job-based coverage, you have the option of continuing your plan through COBRA for 18 months or of purchasing an individual plan through the Marketplace. You don't need to wait until an open enrollment period to sign up for a Marketplace plan if you lost your group insurance.

What If I'm Self-Employed? Can I Get an Individual Marketplace Plan?

If you're self-employed, meaning you run your own business or do freelance or contract work, and you don't have employees, you can purchase an individual Marketplace plan.

If you have employees (not independent contractors), you're considered an employer and a small business. You might be able to use the SHOP Marketplace for small businesses to offer coverage to yourself and your employees.

How Can I Find Out More?

To get more information about the Affordable Care Act, learn about available plans, and get information about how to enroll, go to www.Healthcare.gov.