Most people understand the importance of having a health insurance plan. And, depending on where you live, these can be acquired in several ways.
Purchasing Health Insurance Plans in California
The Patient Protection and Affordable Care Act, more commonly known as the Affordable Care Act (ACA), was signed into law by President Obama on March 23, 2010. It quickly became commonly referred to by the nickname “Obamacare.”
One major change to be aware of is that the federal tax penalty for not having health insurance that was put into place with the passing of the Affordable Care Act was removed in 2019 by the Trump Administration. However, those that were without insurance in 2018 can still face a penalty in their 2019 tax forms.
People must qualify for subsidies when buying through the exchange. According to income guidelines and salary restrictions established by Covered California, an individual must make less than $48,560 per year or, if a family of four earns wages less than $100,400 per year, then they qualify for government subsidy based on their income.
For those who earn more than the state mandated maximums there are many options for a health insurance plan.
Employer Contributions for Health Insurance Plans
There are often many options for employees with employer-provided plans. However, not all plan options are created equal, so to speak.
According to the California Department of Insurance website,
“Many large employers are self-insured. A self-insured employer has a large pool of money and uses it to pay for the health care of employees. The employer most often contracts with insurance companies to manage the health benefits.
It is important to know if your employer is self-insured! Why? You may not have the same protections and benefits as other types of coverage. Self-insured plans do not have to follow California laws on essential health benefits, complaints, and coverage.”
Another important point to know is that there are a few major types of health insurance plans to choose from.
- Preferred Provider Organizations (PPOs) A PPO has a network (or group) of preferred providers. You pay less if you go to these providers. Preferred providers are also called in-network providers. With a PPO, you can go to a doctor or hospital that is not on the preferred provider list. This is called going out-of-network. However, you pay more to go out-of-network. The PPO pays less or nothing at all.
- Health Maintenance Organizations (HMOs) Typically, you must have a primary care doctor who provides your basic care and makes referrals to specialists. If you see a provider outside of your HMO’s network, they will not pay for those services aside from emergency and urgent care visits. The doctors and other providers may be employees of the HMO or they may have contracts with the HMO.
- Exclusive Provider Organization (EPOs) Generally, you do not have to use a primary care doctor, nor do you need to get referrals to see specialists if they are in-network. You can use the doctors and hospitals within the EPO’s network, but you cannot go outside the network for covered care with the exception being an emergency or urgent care situation.
Three More Things to Look For When Buying Your Health Insurance Plan
First, make sure that what you’re considering buying is insurance, not a product like a discount card. It can help to check with the state regulator to determine that the company selling the product is considered a legitimate insurer. Watch out for limited products such as temporary insurance that you may not be able to renew such a plan at the end of that period.
Next, you should take time to read the fine print concerning deductibles, which is the amount of money you must pay before your insurer starts paying. In fact, some policies may have multiple deductibles, including one for each family member. Insurers also do not count certain costs toward the deductible.
Also, according to an article from the Wall Street Journal,
“…watch out for benefit limits, including annual and lifetime maximum payouts. So-called “mini-med” policies that cap their payouts can be dangerous, since you might end up paying bills for thousands of dollars if you have a major illness or surgery. Certain plans pay only a set fee per day of a hospital stay, which could leave you on the hook for thousands of dollars. Drug benefits don’t always include every medication. Some policies exclude maternity coverage, or don’t include care for pre-existing conditions.”
Remember, not all plans are the same and even those in the same “category” can have significant differences. Therefore research is critical on your part. But research alone may not be enough to help you make the best choice in a health care plan. Getting the help of a competent California health insurance agent will help you make an informed decision when choosing the best insurance protection for your business or personal needs.
California Health Plans: Choosing Wisely
Taking time to understand the basics of healthcare insurance coverage and how plans work can save you money and help you choose a plan that provides the benefits and coverage you really need.
There are a number of resources to help you in learning about health insurance plans in California such as the California Department of Insurance and Healthcare.gov, along with seeking out resources from a good agent like JC Lewis Insurance Services.
Being insured is critical for both your physical and fiscal health. One significant change in the rules with Obamacare is the removal of the tax penalty for those uninsured.
The 2018 tax penalty for not having health insurance is $695 for adults and $347.50 for children or 2% of your yearly income, whichever amount is more. This penalty was designed to protect both people from skipping out on health insurance and not being able to pay off their medical expenses in the event of injury or illness.”
Even though the penalty for going without health insurance has been eliminated for the tax year 2019, the potential cost of being uninsured can far exceed any monthly premiums or average out-of-pocket costs. So seek out the guidance of a good agent and make a wise health insurance plan choice.