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Adjusted Gross Income (AGI) – Your total (or “gross”) income for the tax year, minus certain adjustments you’re allowed to take. Adjustments include deductions for conventional IRA contributions, student loan interest, and more. Adjusted gross income appears on IRS Form 1040, line 11.

To report expected income on your Marketplace health insurance application, start with your most recent year's adjusted gross income and update it based on income and household changes you expect for the coverage year.

The Marketplace uses a different figure, called modified adjusted gross income (MAGI), to determine eligibility for savings. MAGI isn't a line on your tax return.

Advance Premium Tax Credit (APTC) – A tax credit you can take in advance to lower your monthly health insurance payment (or “premium”). When you apply for coverage in the Marketplace, you estimate your expected income for the year. If you qualify for a premium tax credit based on your estimate, you can use any amount of the credit in advance to lower your premium.

• If at the end of the year you have taken more premium tax credit in advance than you are due based on your final income, you will have to pay back the excess when you file your federal tax return.
• If you have taken less than you qualify for, you will get the difference back.

Affordable Care Act (ACA) – The health care reform law enacted in March 2010 has three primary goals:

• Make affordable health insurance available to more people. The law provides consumers with subsidies (the “premium tax credit”) that lower costs for households with incomes between 100% and 400% of the federal poverty level.
• Expand Medicaid to cover all adults with income below 138% of the FPL. (Not all states have expanded their Medicaid programs.)
• Support innovative medical care delivery methods designed to lower the costs of health care generally.

Broker – An agent or broker is a person or business who can help you apply for help paying for coverage and enroll in a Qualified Health Plan (QHP) through the Marketplace. They can make specific recommendations about which plan you should enroll in. They’re also licensed and regulated by states and typically get payments, or commissions, from health insurers for enrolling a consumer into an issuer's plans. Some brokers may only be able to sell plans from specific health insurers.

Catastrophic Plan – Health plans that meet all of the requirements applicable to other Qualified Health Plans (QHPs) but that do not cover any benefits other than 3 primary care visits per year before the plan's deductible is met. The premium amount you pay each month for health care is generally lower than for other QHPs, but the out-of-pocket costs for deductibles, copayments, and coinsurance are generally higher. To qualify for a Catastrophic plan, you must be under 30 years old OR get a "hardship/affordability exemption". See below under Exemption for more information.

COBRA – A federal law that may allow you to temporarily keep health coverage after your employment ends, you lose coverage as a dependent of the covered employee, or another qualifying event. If you elect COBRA (Consolidated Omnibus Budget Reconciliation Act) coverage, you pay 100% of the premiums, including the share the employer used to pay, plus a small administrative fee.

Coinsurance – The percentage of costs of a covered health care service you pay (20%, for example) after you have paid your deductible.

If your health insurance plan's allowed amount for an office visit is $100 and your coinsurance is 20%.

• If you have paid your deductible: You pay 20% of $100, or $20. The insurance company pays the rest.
• If you have not met your deductible: You pay the full allowed amount, $100.

Example of coinsurance with high medical costs

Let's say the following amounts apply to your plan and you need a lot of treatment for a serious condition. Allowable costs are $12,000.

• Deductible: $3,000
• Coinsurance: 20%
• Out-of-pocket maximum: $6,850

You would pay all of the first $3,000 (your deductible).
You will pay 20% of the remaining $9,000, or $1,800 (your coinsurance).

So your total out-of-pocket costs would be $4,800 — your $3,000 deductible plus your $1,800 coinsurance.

If your total out-of-pocket costs reach $6,850, you would pay only that amount, including your deductible and coinsurance. The insurance company would pay for all covered services for the rest of your plan year.

Generally speaking, plans with low monthly premiums have higher coinsurance, and plans with higher monthly premiums have lower coinsurance.

Copayment – A fixed amount ($20, for example) you pay for a covered health care service after you have paid your deductible.

Let's say your health insurance plan's allowable cost for a doctor's office visit is $100. Your copayment for a doctor visit is $20.

• If you have paid your deductible: You pay $20, usually at the time of the visit.
• If you have not met your deductible: You pay $100, the full allowable amount for the visit.

Copayments (sometimes called "copays") can vary for different services within the same plan, like drugs, lab tests, and visits to specialists.

Generally plans with lower monthly premiums have higher copayments. Plans with higher monthly premiums usually have lower copayments.

Cost Sharing Reduction (CSR) – A discount that lowers the amount you have to pay for deductibles, copayments, and coinsurance. In the Marketplace, cost-sharing reductions are often called “extra savings.” If you qualify, you must enroll in a plan in the Silver category to get the extra savings.

• When you fill out a Marketplace application, you will find out if you qualify for premium tax credits and extra savings. You can use a premium tax credit for a plan in any metal category. But if you qualify for extra savings too, you will get those savings only if you pick a Silver plan.
• If you qualify for cost-sharing reductions, you also have a lower out-of-pocket maximum — the total amount you would have to pay for covered medical services per year. When you reach your out-of-pocket maximum, your insurance plan covers 100% of all covered services.
• If you are a member of a federally recognized tribe or an Alaska Native Claims Settlement Act (ANCSA) Corporation shareholder, you may qualify for additional cost-sharing reductions.

Deductible – The amount you pay for covered health care services before your insurance plan starts to pay. With a $2,000 deductible, for example, you pay the first $2,000 of covered services yourself.

After you pay your deductible, you usually pay only a copayment or coinsurance for covered services. Your insurance company pays the rest.

• Many plans pay for certain services, like a checkup or disease management programs, before you've met your deductible. Check your plan details.
• All Marketplace health plans pay the full cost of certain preventive benefits even before you meet your deductible.
• Some plans have separate deductibles for certain services, like prescription drugs.
• Family plans often have both an individual deductible, which applies to each person, and a family deductible, which applies to all family members.

Generally, plans with lower monthly premiums have higher deductibles. Plans with higher monthly premiums usually have lower deductibles.

Dividend – A payment made by a for-profit corporation to its shareholders. This payment is a portion of the corporate earnings and may be paid a certain number of times each year (like each quarter).

Employer Shared Responsibility Payment (ESRP) – The Affordable Care Act requires certain employers with at least 50 full-time employees (or equivalents) to offer health insurance coverage to its full-time employees (and their dependents) that meets certain minimum standards set by the Affordable Care Act or to make a tax payment called the ESRP.

Essential Health Benefits – A set of 10 categories of services health insurance plans must cover under the Affordable Care Act. These include doctors’ services, inpatient and outpatient hospital care, prescription drug coverage, pregnancy and childbirth, mental health services, and more. Some plans cover more services.

Plans must offer dental coverage for children. Dental benefits for adults are optional.

Specific services may vary based on your state’s requirements. You will see exactly what each plan offers when you compare plans.

Exclusive Provider Organization (EPO) – A managed care plan where services are covered only if you use doctors, specialists, or hospitals in the plan’s network (except in an emergency).

Exemption – Granted based on certain hardships and life events, health coverage or financial status, membership in some groups, and other circumstances. New Jersey residents must have qualifying health insurance or pay a fee (sometimes called the “Shared Responsibility Payment,” “mandate,” or “penalty”) unless they qualify for a health coverage exemption.

Flexible Spending Account (FSA) – An arrangement through your employer that lets you pay for many out-of-pocket medical expenses with tax-free dollars. Allowed expenses include insurance copayments and deductibles, qualified prescription drugs, insulin, and medical devices.

You decide how much to put in an FSA, up to a limit set by your employer. You aren't taxed on this money.

If money is left at the end of the year, the employer can offer one of two options (not both):

• You get 2.5 more months to spend the left-over money.
• You can carry over a certain amount to spend the next plan year.

Flexible Spending Accounts are sometimes called Flexible Spending Arrangements.

Generic Drugs – A prescription drug that has the same active-ingredient formula as a brand-name drug. Generic drugs usually cost less than brand-name drugs. The Food and Drug Administration (FDA) rates these drugs to be as safe and effective as brand-name drugs.

Health Maintenance Organization (HMO) – A type of health insurance plan that usually limits coverage to care from doctors who work for or contract with the HMO. It generally won't cover out-of-network care except in an emergency. An HMO may require you to live or work in its service area to be eligible for coverage. HMOs often provide integrated care and focus on prevention and wellness.

Health Reimbursement Arrangement (HRA) – Health Reimbursement Arrangements (HRAs) are employer-funded group health plans from which employees are reimbursed tax-free for qualified medical expenses up to a fixed dollar amount per year. Unused amounts may be rolled over to be used in subsequent years. The employer funds and owns the arrangement. Health Reimbursement Arrangements are sometimes called Health Reimbursement Accounts.

Health Savings Account (HSA) – A type of savings account that lets you set aside money on a federal pre-tax basis to pay for qualified medical expenses. By using federally untaxed dollars in an HSA to pay for deductibles, copayments, coinsurance, and some other expenses, you may be able to lower your out-of-pocket health care costs. HSA funds generally may not be used to pay premiums.  While you can use the funds in an HSA at any time to pay for qualified medical expenses, you may contribute to an HSA only if you have an HSA-eligible plan (sometimes called a High Deductible Health Plan (HDHP) – generally a health plan (including a Marketplace plan) that only covers preventive services before the deductible. Bronze and Catastrophic Marketplace plans are considered HDHPs, as well as other plans.  An HSA may earn interest or other earnings, which are not federally taxable. Banks, credit unions, and other financial institutions offer HSAs.

In-network Coinsurance – The percent (for example, 20%) you pay of the allowed amount for covered health care services to providers who contract with your health insurance or plan. In-network coinsurance usually costs you less than out-of-network coinsurance.

In-network Copayment – A fixed amount (for example, $15) you pay for covered health care services to providers who contract with your health insurance or plan. In-network copayments usually are less than out-of-network copayments.

Life-changing events – Certain life events such as a birth, marriage, loss of coverage or relocation, for which you can enroll or change your current coverage through the Marketplace, or off the Marketplace, without waiting for the Annual Open Enrollment Period.

If you qualify for an SEP, you usually have up to 60 days following the event to enroll in a plan. If you miss that window, you have to wait until the next Open Enrollment Period to apply.

Marketplace – Shorthand for the “Health Insurance Marketplace,” a shopping and enrollment service for medical insurance created by the Affordable Care Act in 2010. New Jersey now operates its own Marketplace called Get Covered New Jersey.

Medicaid – Insurance program that provides free or low-cost health coverage to some low-income people, families and children, pregnant women, the elderly, and people with disabilities. Many states including New Jersey have expanded their Medicaid programs to cover people below certain income levels.

Medicaid benefits, and program names, vary somewhat between states.

You can apply anytime. If you qualify, your coverage can begin immediately, any time of year.

In New Jersey, you can apply for Medicaid through NJ FamilyCare.

Medicare – A federal health insurance program for people 65 and older and certain younger people with disabilities. It also covers people with End-Stage Renal Disease (permanent kidney failure requiring dialysis or a transplant, sometimes called ESRD).

Medicare Advantage (Medicare Part C) – A type of Medicare health plan offered by a private company that contracts with Medicare to provide you with all your Part A and Part B benefits. Medicare Advantage Plans include Health Maintenance Organizations, Preferred Provider Organizations, Private Fee-for-Service Plans, Special Needs Plans, and Medicare Medical Savings Account Plans. If you’re enrolled in a Medicare Advantage Plan, most Medicare services are covered through the plan and aren’t paid for under Original Medicare. Most Medicare Advantage Plans offer prescription drug coverage.

Minimum Essential Coverage (MEC) – Any insurance plan that meets the Affordable Care Act requirement for having health coverage. To avoid the penalty from the State of New Jersey you must be enrolled in a plan that qualifies as minimum essential coverage (sometimes called “qualifying health coverage”). Examples of plans that qualify include: Marketplace plans; job-based plans; Medicare; NJ FamilyCare and Medicaid & CHIP.

Modified Adjusted Gross Income (MAGI) – The figure used to determine eligibility for premium tax credits and other savings for Marketplace health insurance plans and for Medicaid and the Children's Health Insurance Program (CHIP). MAGI is adjusted gross income (AGI) plus these, if any: untaxed foreign income, non-taxable Social Security benefits, and tax-exempt interest.

• For many people, MAGI is identical or very close to adjusted gross income.
• MAGI does not include Supplemental Security Income (SSI).
• MAGI does not appear as a line on your tax return.

Navigator – An individual or organization that is trained and able to help consumers as they look for health coverage options through the Marketplace, including completing eligibility and enrollment forms. These individuals and organizations are required to be unbiased. Their services are free to consumers.

New Jersey Health Plan Savings – A state subsidy that lowers the cost of health insurance. These savings are only possible because New Jersey is operating the Health Insurance Marketplace through GetCovered.NJ.Gov.

The NJ Health Plan Savings (NJHPS) decreases the cost of premiums for current Marketplace enrollees and for new enrollees. 

Similar to the Advance Premium Tax Credit (APTC), New Jersey residents will qualify for these savings based on income.

Open Enrollment – Open Enrollment is the yearly period when you can enroll in health insurance. In New Jersey, Open Enrollment is November 1 to January 31. Open Enrollment is the only time during the year when you can enroll in coverage, unless you experience a major life event that qualifies you for a Special Enrollment Period, if a state-designated Special Enrollment Period is in effect, or if you qualify for NJ FamilyCare.

Out-of-Network Coinsurance – The percentage (for example, 40%) you pay of the allowed amount for covered health care services to providers who do not contract with your health insurance or plan. Out-of-network coinsurance usually costs you more than in-network coinsurance.

Out-of-Network Copayment – A fixed amount (for example, $30) you pay for covered health care services from providers who do not contract with your health insurance or plan. Out-of-network copayments usually are more than in-network copayments.

Out-of-Pocket Cost – Your expenses for medical care that are not reimbursed by insurance. Out-of-pocket costs include deductibles, coinsurance, and copayments for covered services plus all costs for services that are not covered.

Out-of-Pocket Maximum – The most you have to spend for covered services in a year. After you spend this amount on deductibles, copayments, and coinsurance for in-network care and services, your health plan pays 100% of the costs of covered benefits.

Point of Service (POS) Plan – A type of plan where you pay less if you use doctors, hospitals, and other health care providers that belong to the plan’s network. POS plans require you to get a referral from your primary care doctor to see a specialist.

Preferred Provider Organization (PPO) – A type of health plan that contracts with medical providers, such as hospitals and doctors, to create a network of participating providers. You pay less if you use providers that belong to the plan’s network. You can use doctors, hospitals, and providers outside of the network for an additional cost.

Premium – The amount you pay for your health insurance every month. In addition to your premium, you usually have to pay other costs for your health care, including a deductible, copayments, and coinsurance.

Premium Tax Credit or PTC – A tax credit you can use to lower your monthly insurance payment (called your “premium”) when you enroll in a plan through Get Covered New Jersey. Your tax credit is based on the income estimate and household information you put on your Get Covered New Jersey application.

You can use all, some, or none of your premium tax credit in advance to lower your monthly premium.

• If you use more advance payments of the tax credit than you qualify for based on your final yearly income, you must repay the difference when you file your federal income tax return.
• If you use less premium tax credit than you qualify for, you’ll get the difference as a refundable credit when you file your taxes.

Qualified Small Employer Health Reimbursement Arrangement (QSEHRA) – Small employers who don't offer group health coverage to their employees can help employees pay for medical expenses through a Qualified Small Employer Health Reimbursement Arrangement (QSEHRA). If your employer offers you a QSEHRA, you can use it to help pay your household's health care costs (like your monthly premium) for qualifying health coverage.

Qualifying Health Coverage – Any health insurance that meets the Affordable Care Act requirement for coverage. Examples: individual plans, including Marketplace plans; job-based plans; Medicare; and Medicaid & CHIP.

A more complete list of qualifying health coverage:

• Any health plan brought through the Marketplace 
• Individual plans bought outside the Marketplace, if they meet the standards for qualified health plans
• Medicare Part A (Hospital Insurance) or Medicare Advantage Plan (Part C) (but Medicare Part B (Medical Insurance) and Medicare drug coverage (Part D) by themselves don’t count)
• Medicaid (except limited coverage plans)
• The Children's Health Insurance Program (CHIP)
• Coverage under a parent's plan
• Most student health plans (ask your school if the plan counts)
• TRICARE
• Plans sold through the Small Business Health Insurance Program (SHOP) Marketplace
• Health coverage for Peace Corps volunteers
• Certain types of veterans health coverage through the Department of Veterans Affairs
• Any "grandfathered" individual insurance plan you’ve had since March 23, 2010, or earlier
• Department of Defense Non appropriated Fund Health Benefits Program
• Refugee Medical Assistance

Qualifying Life Event (QLE) – A change in your situation — like getting married, having a baby, or losing health coverage — that can make you eligible for a Special Enrollment Period, allowing you to enroll in health insurance outside the yearly Open Enrollment Period.

Reconcile Your Taxes – When receiving Premium Tax Credits, consumers must compare the amount of premium tax credits they received in a year against the amount of tax credits they were eligible for during that year based on year-end income. If you received tax credits, you will receive form 1095-A from Get Covered New Jersey in January. Form 1095-A is needed to file your Federal Income Tax Return. It shows how many months you had health insurance coverage and the amount of Advance Premium Tax Credit (APTC) you received.  You will use form 1095-A to complete IRS Form 8962, Premium Tax Credit, to report the amount of APTC you received on your tax filing.

If you received more premium tax credits than you qualified for, you may owe some of the premium tax credits back in your taxes. If you received too little, you could receive an additional tax credit. See Frequently Asked Questions for more information.

Referral – A written order from your primary care doctor for you to see a specialist or get certain medical services. In many Health Maintenance Organizations (HMOs), you need to get a referral before you can get medical care from anyone except your primary care doctor. If you don’t get a referral first, the plan may not pay for the services.

Second lowest cost Silver plan (SLCSP) – The second-lowest priced Marketplace health insurance plan in the Silver category that applies to you. It may not be the plan you enrolled in. You need to know your second lowest cost Silver plan (SLCSP) premium to figure out your final premium tax credit. In most cases, you’ll find your SLCSP premium on Form 1095-A.

The Marketplace sends Form 1095-A to you early in the year after someone in your household had a Marketplace health plan.

Shared Responsibility Payment  – New Jersey requires state residents to maintain health insurance. The law requires you and your family to have minimum essential health coverage, unless you qualify for an exemption. Failure to have health coverage or qualify for an exemption will result in a Shared Responsibility Payment when you file your New Jersey Income Tax return. For more information visit the Department of Treasury website.

Special Enrollment Period – A period outside of Open Enrollment where a consumer can apply for coverage if they have a qualifying life event, such as marriage, a birth or adoption of a child, losing employer sponsored coverage, and other changes. The state may also designate a Special Enrollment Period in response to the needs of its residents.

State Subsidy – Financial help available to lower the cost of health insurance. The state subsidy – called the NJ Health Plan Savings (NJHPS) – will decrease the costs of premiums for current Marketplace enrollees and for new enrollees. 

Similar to the Advance Premium Tax Credit (APTC), New Jersey residents will qualify for these savings based on income.

Summary of Benefits and Coverage (SBC) – An easy-to-read summary that lets you make apples-to-apples comparisons of costs and coverage between health plans. You can compare options based on price, benefits, and other features that may be important to you. You'll get the "Summary of Benefits and Coverage" (SBC) when you shop for coverage on your own or through your job, renew or change coverage, or request an SBC from the health insurance company.  SBCs for plans available on the Marketplace can be reviewed when shopping for a plan and after enrolling.

Total Cost Estimate (for health coverage) – The total amount you may have to pay for health plan coverage, which is estimated before you actually have the coverage and have health expenses under the coverage.

Generally, your total cost is your premium + deductible + out-of-pocket costs + any copayments/coinsurance. When you preview plans at Get Covered New Jersey, you will see an estimate of your total costs, but your actual expenses will likely vary.