A health insurance exchange, also called a marketplace, is where you can buy a health insurance plan for individuals and families. Exchanges were set up by the Affordable Care Act (ACA), also known as Obamacare. They make it easier to see what plans are available in an area, compare them, and make a purchase.
The most common exchange is healthcare.gov and it’s run by the federal government. Americans in 33 states enroll in health insurance plans through the federal exchange. The other 17 states and the District of Columbia have their own exchanges. You can find your state’s exchange through healthcare.gov.
Private exchanges are similar to healthcare.gov but they can also show you off-exchange plans. These plans have to meet the same requirements as on-exchange plans, except that they don’t need to offer plans across all of the four metal tiers. That means a company can choose to offer only one plan and tailor it to certain types of customers.
On either exchange type, you can verify important information like what medications are covered, which doctors are in the network, and the costs of monthly premiums, copays, and the deductible for each plan. (Our health insurance 101 guide can help you understand the basic things to look for in a plan.)
How healthcare.gov works
Healthcare.gov is the health insurance marketplace operated by the federal government. It launched in 2013 as part of the Affordable Care Act. The marketplace allows you to compare and apply for private health insurance policies.
Unless a state creates its own marketplace, its citizens will default to using the federal exchange. For residents in one of the 17 states with its own health insurance marketplace, healthcare.gov will redirect them to the appropriate state marketplace.
You need to create a free healthcare.gov account in order to search and enroll in a marketplace plan online. You can also sign up without an account by calling the insurance company, going through an agent or broker, using an enrollment partner website, or completing a paper application.
In states using the federal exchange, you can also use healthcare.gov to see if you qualify for public health insurance programs like Medicaid or the Children's Health Insurance Program (CHIP). (Learn more about Medicaid in your area with our state-by-state guide to Medicaid.)
Subsidies that help pay for health insurance premiums, like the premium tax credit, can only be used on plans that are available through a government marketplace (though you don’t actually have to buy the plan through the government marketplace).
For other types of insurance, such as life insurance, you may need to go through a broker (such as Policygenius!).
Benefits all healthcare.gov plans must have
All health plans listed on healthcare.gov must cover Obamacare’s 10 essential benefits:
Outpatient care (officially called ambulatory patient services)
Pediatric services, including dental and vision coverage for children
Laboratory services
Emergency services
Hospitalization for surgery, overnight stays, and other conditions
Mental health coverage and substance use disorder services
Rehabilitative and habilitative services
Pregnancy, maternity, and newborn care
Plans on the federal marketplace must also include birth control coverage, breastfeeding coverage, and coverage for pre-existing conditions. State marketplaces may require all insurers to offer further coverage.
Additionally, health insurance companies can only provide policies through healthcare.gov if they have a plan available for each of the four metal tiers. Individual plans are divided into the metal tiers — Bronze, Silver, Gold, and Platinum — based on the cost-sharing split between the customer and the insurance company. Having the metal tiers allows you to make an apples-to-apples comparison of benefits and costs.
Related article: How much Obamacare costs in each state.
State marketplaces
As of 2022, 17 states and the District of Columbia have their own marketplaces for individuals and families: California, Colorado, Connecticut, Idaho, Kentucky, Maine, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Pennsylvania, Rhode Island, Vermont, and Washington.
State marketplaces generally work the same way as the federal exchange. The big difference is the state, not the federal government, is in charge of all aspects of the health insurance exchange.
This also means a state has more control over the health insurance plans available on its exchange. States with their own marketplaces can place additional rules on insurance plans, requiring them to cover more benefits and services. States can also set different quality and pricing guidelines for policies.
States may also set different qualifying events for special enrollment periods. For example, New York allows women to qualify for a special enrollment period when they become pregnant, while the federal government only counts the birth of a child as a qualifying life event.
Private health insurance marketplaces
Besides the government marketplaces, there are also private health insurance exchanges.
Private health insurance exchanges can still show you all the plans available on your federal or state marketplace. If you qualify for a premium subsidy, you can still use it if you shop through a private health insurance exchange, as long as you get a plan that is also available on healthcare.gov or your state exchange.
A major difference with private exchanges is that they can also show you “off-exchange” health insurance plans. Off-exchange insurance plans are not available on any federal or state marketplace. However, off-exchange plans still adhere to the same federal rules as on-exchange plans, such as covering the 10 essential health benefits we mentioned earlier. All plans, whether on-exchange or off-exchange, can only base your premium on four factors: whether it’s an individual or family plan, the area you live in, your age, and whether you use tobacco.
Off-exchange plans vs on-exchange plans
Off-exchange health insurance plans are primarily different because they allow insurers to structure their plans in different ways and potentially save the customer money. For example, government exchanges require all participating insurers to provide a plan in each of the four metal tiers. However, an insurer may only want to offer a single plan. They can do that with off-exchange plans.
Read more about whether you should consider an off-exchange plan.
The health insurance enrollment process
Enrolling in a health insurance plan is relatively straightforward. Decide whether to go through a private marketplace or your government-run option, and then you can begin comparing plans. You can also get insurance coverage through your employer if they provide health insurance benefits.
If you want to search on a state or federal marketplace, you typically need to create an account on the appropriate marketplace site and fill out a short application before you can view plans. Then you can enroll directly on the site.
No matter where you get health insurance coverage, after you’ve filled out the application and officially enrolled, you will receive your membership materials, including your member ID card, and your first bill directly from the health insurance company. Pay that bill and your coverage will go into effect on the specified effective date (usually Jan. 1).
Get ready for open enrollment with our how-to guide for using the health insurance exchanges.
Important 2024 Open Enrollment information
Regardless of which marketplace you shop on, make sure that you’re shopping during Open Enrollment (unless you qualify for a Special Enrollment Period). The federal health insurance exchange is open from Nov. 1, 2023, through Jan. 15, 2024 for you to get a 2024 plan.
Some states may give you longer to enroll. Learn more in our state-by-state guide to health insurance open enrollment.
