The New Health Insurance Landscape (CA)

The New Health Insurance Landscape (CA)

The ACA or “Affordable Care Act” has dramatically changed the way people obtain their health care coverage. The following are some common questions I have gotten and my best guess at the correct answer.


Q:        Shopping for insurance in the past was complicated by the complex benefits, co-pays, deductible, and provider network carriers offered. Do I have the same challenge with the new plans or is it just a question of metal plan choices and provider networks?

Answer:

All individual, family, and small employer group health plans offer a similar package of comprehensive services that cover 10 so-called essential health benefits and cover certain types of preventive care at 100 percent or zero cost to you. Within each metal category benefits, co-pay, and deductibles are identical to make comparisons easier than the old health care plans. The main distinction is cost and the provider network each plan offers. Make sure your doctors are in the network of the carrier you choose although in some cases such as specialists, providers don’t accept any health plans.


Q:        I have heard so many bad things about “Obamacare” so I don’t want it because it sounds really bad for my family and our country. Is there regular health insurance available that is not “Obamacare?”

Answer:         

All of the health plans now comply with the “Affordable Care Act” of 2010 except some of the older employer plans or group plans that are grandfathered in until 2016. So a silver metal plan with Blue Shield, is exactly the same whether it is subsidized via Covered California or “off the exchange” which means it is not subsidized. If people qualify for premium assistance through Covered California and choose not to take that assistance they can go directly to the insurance carriers but the plan and cost will be the same. I can help obtain “off exchange” health insurance and do when I have determined that a person does not qualify for any subsidy.


Q:        How do I know what subsidy I qualify for if any?

Answer:

Your agent can run the cost calculator or you can go to the Covered California website cost calculator.  Subsidies are available for household income up to 400% of the poverty level in your zip code. The result will indicate your share of the premium as well as the amount of subsidy.


Q:        I don’t want to lose my doctor, how do I know if a plan will cover his services?

Answer:

The best method is to call your doctor’s office and ask if they accept a plan you are considering. There is an online listing at Covered California as well as at the carrier’s web sites but these lists are not always accurate. Check directly with your doctor or provider including any hospital you might use.


Q:        How does the cost assistance or subsidy work with regard to my premium payment for the health coverage I choose?

Answer:

The subsidy is stated when you enter your information into the cost calculator. It will tell you the total cost, your subsidy, and the net cost. When you are billed by the insurance carrier you only pay the net amount due. The Federal government is paying your subsidy amount directly to the insurance carriers.


Q:        I am offered a health plan at work but the cost for my contribution is high, can I get a cheaper plan through Covered California?

Answer:

In this instance if the plan at work costs more than 9.5% of your gross wages you qualify for a subsidy. However, you should check the cost calculator to see how much subsidy you would get. More importantly, many of the old health plans have not had to switch over to the metal plans now available. That means there may be lower out of pocket costs with your work plan and it may be better to stay on it until the benefits are the same as the new metal health plans. Although all metal plans are equal, employers can improve some of the benefits and out of pocket expenses within their plans.


Q:        I signed up for Covered California already but my income has changed and I may qualify for more benefits or less benefits. How do I know and what do I do?

Answer:

Your agent can make the change within his agent portal or you can go into your account with Covered California and “update” your information. When you put in your new income you will be asked to select a plan again and this selection will let you know the new cost and subsidy.


Q:        I missed the sign up for coverage, can I still obtain coverage during 2014 or must I wait until 2015 to get coverage?

Answer:

The enrollment period is over. However, if you meet one of the special exceptions such as newly married or divorced, new baby, moved into CA recently, lost your old coverage, etc you can get coverage in the month after you sign up. If you don’t qualify for an exception, temporary coverage is available until new coverage is open for 2015. Sign up for 2015 coverage begins November 15th.


Q:        I am expecting to get a new job which will offer me health coverage, should I get coverage now or wait?

Answer:

If coverage at work is imminent then waiting might make sense although some people don’t want to be vulnerable for even one month. You should also check to see if there is a waiting period for the work plan. With the new plans you can drop out once you get cheaper or better coverage such as work plans.


Q:        My child just turned 26 and was taken off my health plan, can I get him/her on their own plan?

Answer:

Yes, this would qualify as a special enrollment event because your child lost their coverage.


Q:        I or my spouse will turn 65 during the current health plan year. Am I required to move off my Covered California plan and onto medicare and if so, what impact does that have on the cost of my plan for other family members?

Answer:

You are required to update your application online anytime you are offered “affordable” coverage outside of Covered CA. The logic is similar to a big pay raise where you no longer qualify for assistance. If you stay on your subsidized plan after medicare was available to you, you might have to repay the premium subsidy you received after that point. This is not a concern where your coverage is through work or is “off exchange” where you receive no premium assistance. Those events fall under medicare’s enrollment rules.

Once you have removed the medicare eligible person from the family coverage your cost should be lower because that person no longer requires coverage. If you are on a subsidized plan it will also lower the premium assistance you receive but the net cost may be close to the same. In general, it is better to have medicare coverage than the new metal health plans because the out of pocket expense is usually lower.


Q:        I or a family member am unemployed or underemployed and have no health coverage. What are my options to obtain coverage?

Answer:

If your income or your expected income is over the poverty level for your geographic area, you should qualify for Covered Cal. coverage. Otherwise you would be eligible for Medi-cal, our state version of the federal Medicaid program.


Q:        I and/or my spouse am on social security or disability. Does that income count towards the calculation to determine subsidy eligibility?

Answer:

Yes, most income does count in the calculation for subsidy eligibility. Some items that are NOT included as gross income for your income tax return ARE included in determining subsidy calculation.


Q:        I am a small business owner, a contractor, or self employed. How do I estimate eligibility for Covered California?

Answer:

This category of applicant is often well positioned to obtain a subsidy because they are able to write off so many expenses to reduce their adjusted gross income. However, the expenses you report must comply with those that are used on your tax return. You cannot create a different set of expenses or else your application will not conform to your tax return. If your income is so great that you exceed the limit of 400% of poverty after business expenses, you will not qualify for a subsidy.


Q:        How does an “HSA” or Health Savings Account work?

Answer:

You should check with your accountant or tax preparer to see if this makes sense for you but in essence, it is a way of putting before tax funds towards health expenses such as co-pays and deductibles so that you save money on taxes.


Q:        How do I know if I can get  coverage though Medi-Cal and what is the difference between Medi-Cal and the new metal health plans?

Answer:

When you or your agent enter the data required for the cost estimator for Covered Cal, it will tell you if you qualify for a subsidy, medi-cal, or nothing. In broad terms, you will qualify for medi-cal if your “modified adjusted gross income” is under the poverty level, qualify for a Covered California subsidy if you are above poverty and below 400% of poverty, and are on your own if your income is over 400% of poverty.


Q:        How do I know if I qualify for an “enhanced” silver plan to lower my co-payments, out of pocket costs, and deductibles?

Answer:

The enhanced silver plans give you more benefits than a standard silver plan, which in broad terms pays 70% of your healthcare costs while you pay 30%. Enhanced silver levels are 73%, 87%, and a maximum of 94% depending on how close to the poverty level you fall.  You’re eligible for enhanced silver if your income is between poverty and 250% of poverty.


Q:        What if my spouse has affordable coverage at work but I don’t have coverage?

Answer:

This situation may fall under what is called the “family glitch” and allow you to obtain coverage but no subsidy because one member of the household has affordable coverage. Check with your agent or Covered California.