The Affordable Care Act has allowed our state programs to expand and cover more people, especially children, for very low premiums or even at no cost. If you have been without health insurance, or if you have a plan that is just too expensive for your budget, please make the effort to enroll by December 15 and get a new health plan effective January 1, 2014.
What is most important for you in selecting a new health plan? For some it’s simply premium. For many, it’s the choice of doctors and whether their doctor is within the network. And others feel the cost of medications on the plan can be the deciding factor. You have HMO, HSA, PPO, and EPPO plans from which to choose. Then there is off exchange, in exchange, premium subsidies and the “metal tiers” to consider. So where would you start?
First, will you qualify for a premium subsidy? This is a simple matter, but many incorrectly believe they won’t qualify. If you are a couple with less than $60,000 in annual Adjusted Gross Income (AGI), chances are you will be able to receive a partial subsidy and apply that to your premiums. The lower the income, the more subsidy you may receive. The larger the household, the higher the AGI threshold for qualifying.
But, be certain you use a good estimate of your AGI, based on what you expect to earn next year. You can base it on 2012 or 2013 to date, but try to be as close as you can. If you underestimate, it will be up to you to report your change in income throughout the year in 2014, or the IRS will want a lot of that subsidy back. When you file your 2014 taxes, any overpayment to you will be due back to the IRS, and will come right out of any expected refund.
The number of people in the household also comes right from your tax return, but now we have to also consider, is anyone already on Medicare, or MediCal, or any other health plan, and will they be staying on that plan?
If you qualify for a subsidy, you have to enroll in a health plan through the Covered California Exchange to receive it. Don’t worry, that’s pretty easy.
Next, what doctors can you choose?
Most people love the simplicity of HMO’s, but frankly, in practice, they don’t like being stuck to a small network of doctors and waiting for specialist referrals. Besides, if you travel outside our area, like most of us do in summertime, your HMO might only provide the most basic emergency care outside of your home area. For this and other reasons, many still prefer to be in a PPO.
Is your doctor “in-network”? Check the provider directory online very closely. Many times people simply ask if their doctor “takes” their insurance plan. The front office might say “Yes,” because they know how to bill the plan, but if they are not “in network,” you will be hit with higher co-pays. And, in the exchange, there is at least one plan that has an EPO (Exclusive Provider Organization), which means you only receive benefits when you use an in-network doctor or facility, and nothing at all if you use “out of network doctors.”
Next, how much risk will you be willing to carry?
The whole idea of insurance is called risk sharing or risk assignment. In most cases, you will still have a deductible and co-pays, and you will also have a maximum-out-of-pocket allowance. That is the total amount of your risk for the calendar year. The lower the premium, the higher your retained risk. When enrolling in a new plan, you can take more risk with some family members and less for others. Maybe your kids play a lot of sports, or have chronic conditions. In that case, they would need a higher premium plan with less retained risk for you. Maybe Mom has always been in perfect health and only has an annual check-up each year. In her case, a low premium plan with a larger deductible would work just fine.
Once you have selected plans for each family member, I recommend filling out a paper application, not an online one. At least not yet. With its initial launch, the CoveredCA.com system has been unreliable, so a completed paper application (with you retaining one copy and sending the original in by mail) is far more reliable. And, nothing holds up enrollment more than an incomplete or incorrect application. Do as thorough a job as you can, and take your time.
Randy Foulds is a Certified California Exchange Health Insurance Agent (license #0G69218) with Feldmann Insurance Agency which has been writing health insurance policies locally for over 20 years. He can be reached at (760) 346.6565.
Comments (0)