Covered California “open enrollment” begins November 15 so I would like to share some thoughts on Obamacare. This newsletter deals with individuals and families who don’t get health insurance through an employer or qualify for Medicare. If you want to talk about Medicare Supplements or health insurance for small businesses, give me a call!
What Is Obamacare?
It’s not health insurance. Obamacare is a nickname for the Affordable Care Act (ACA) that made sweeping changes to the health insurance marketplace. Key provisions include:
- Individuals who don’t get health insurance from employers must buy it or face a fine.
- Lower income individuals can buy insurance from an exchange (in California called Covered California) and receive a tax credit subsidy.
- All plans include a list of essential health benefits.
- Insurance can’t be denied because of preexisting conditions, can’t be cancelled because you get sick and can’t have a maximum lifetime payout.
- Insurance contracts are standardized.
Standardized Insurance Contracts
Under the ACA, almost all contracts cover the same illnesses and offer the same benefits. They are organized by “tier” which vary by premium and share of cost (bronze-lowest premium and highest share of cost, silver and gold-in between, and platinum-highest premium and lowest share of cost).
You can buy your health insurance on the exchange (Covered California) or off the exchange (directly from the insurance company). The price is the same. Either way you can use an agent like me for no extra cost. You must buy insurance on the exchange to qualify for the subsidy.
Network
Once you decide what tier you want and if you should use the exchange (qualify for subsidy), you need to pick a provider. Here you compare prices and network availability. Some networks (like Kaiser) are HMOs with an in-house network and others (like the Blues) are PPOs that let you choose among a list of participating doctors and hospitals. Some providers like Anthem include major desert providers like Eisenhower Medical Center in their networks, and others do not, so network is an important consideration.
Issues and Tips
- I’m seeing a lot of confusion among providers around network acceptance right now. Covered California pays doctors less than off exchange plans, so some providers are pushing back against accepting their members. If you qualify for the subsidy, double check your provider list and confirm coverage with your favorite providers. If you do not qualify for the subsidy, buy your insurance off the exchange.
- When you use the exchange you authorize Covered California to verify your subsidy eligibility with the IRS. If you make too much money they will recapture the subsidy. There is no free lunch.
- Stay in your network. A PPO covers some out of network costs, but the annual out of pocket limit only applies to network. Also, avoid the ER except for true emergencies.
- Pay on time. Insurance companies can’t cancel you for being sick or claims history. But they can and will for late payment. Don’t give them that chance.
- Use an agent. I’m almost hesitant to say this since dealing with the health insurance bureaucracy is a big pain in the butt. But I have the experience and it doesn’t cost you any more.
You can’t just sign up when you’re sick. You can only sign up or make changes during the open enrollment period that is from November 15, 2014 to February 15, 2015. So if you need health insurance, don’t delay.
For more ACA information visit the Covered California website and, as always, feel free to call me with questions.