Understanding Obamacare and What it Means for You
With Open enrollment for Healthcare just opening, there has been a lot of hype about “Obamacare” premiums raising, yet most of us have no idea what this means or even how to apply. According to government data, monthly insurance premiums on www.HealthCare.gov are rising by an average of 25 percent. So how does “Obamacare” officially known as the Affordable Care Act, affect California residents?
There are lots of factors contributing to the price changes. Premiums are going up in some areas because insurance companies are dropping out of the market, leaving consumers with fewer options. Some insurance companies are raising rates because the premiums they charged initially were too low to cover the costs they faced, causing them to lose money. Consumers in more rural areas tend to have fewer options for coverage, since it can be more expensive for insurers to offer plans in markets with smaller populations and fewer choices for health-care providers. Luckily, in the Bay area, we have lots of options.
The takeaway for consumers is to shop around and compare plans during open enrollment season, which ends on Jan. 31, 2017. About 13.8 million people are expected to choose insurance plans through the exchanges during this enrollment period, according to estimates from the Department of Health and Human Services. If you are lucky enough to have insurance through your job, you are not affected and will have a separate open enrollment period through your employers.
There are two kinds of Marketplaces available. There’s the 1) federal health insurance Marketplace (Healthcare.gov) in some states, and there are 2) state-run Marketplaces in other states. California has its own state health exchange set up, also known as Covered California.
What about California?
In California, like the rest of the country, the Affordable Care Act requires most U.S. citizens, U.S. nationals, and permanent residents to have health coverage that meets minimum coverage requirements. Unless you qualify for an exemption, you could pay a tax penalty if you go without health coverage for two months in a row or longer.
Like in the rest of the United States, the health plans available on Covered California fall into four metal levels. The metal levels reflect the costs you can expect to pay for health plans in each category; they don’t have to do with the quality of care.
Four levels explained
Health plans sold on the California health exchange fit into the following four metal levels:
- Bronze level: On average, your plan pays 60% of covered health-care costs; you pay the remaining 40%.
- Silver level: On average, your plan pays 70% of covered health-care costs; you pay the remaining 30%.
- Gold level: On average, your plan pays 80% of covered health-care costs; you pay the remaining 20%.
- Platinum level: On average, your plan pays 90% of covered health-care costs; you pay the remaining 10%.
Enhanced Silver plan?
The California health exchange also offers an Enhanced Silver plan for certain individuals with limited income who qualify for lower out-of-pocket costs. With an Enhanced Silver plan, eligible individuals who purchase a Silver plan will have the lower cost-sharing benefits of a Gold or Platinum plan — but for the cost of a Silver level plan. There are three types of Enhanced Silver plans available, and each type has a different level of cost sharing:
- Plan pays 94%: On average, your health plan pays 94% of health-care costs; you pay the remaining 6%.
- Plan pays 87%: On average, your health plan pays 87% of health-care costs; you pay the remaining 13%.
- Plan pays 73%: On average, your health plan pays 73% of health-care costs; you pay the remaining 27%.
In California, as in the rest of the United States, all health plans sold on the individual and family Marketplace must meet minimum coverage requirements, or “essential health benefits.” These required benefits include:
- Ambulatory services
- Emergency or urgent care
- Hospitalization services
- Maternity and newborn care
- Mental health and substance abuse services, including counseling
- Prescription medications
- Rehabilitative services and equipment
- Laboratory services
- Preventive and wellness care, including chronic-condition management
- Pediatric services (which must include dental and vision care for children)
All health plans sold on the California health insurance exchange include pediatric dental care as a covered benefit. Dental coverage for children under 19 is an essential health benefit, and pediatric dental services are “embedded” into the health plan.
Adult dental services are not a minimum health coverage requirement, and health plans are not required to cover dental care. Dental coverage is optional, so there isn’t a penalty if you don’t get dental insurance. If you do want adult dental coverage, you’ll need to purchase this coverage through a stand-alone dental plan and pay a monthly premium for it.
Starting with the 2016 plan year, you’ll have the option to enroll in a stand-alone dental plan on Covered California. If you have children, they’re automatically covered for dental services by any health plan sold through the California health exchange. However, if you like, you can purchase a separate family dental plan that may offer additional pediatric dental benefits. Or, alternatively, you can find a wide selection of dental plans through a licensed insurance broker, such as eHealth.
California residents with limited income may qualify for help with health-care costs. Depending on your income level and eligibility, you may qualify for lower premiums, also known as premium tax credits or other subsidies. In some cases, in addition to lower premiums, you may also be eligible for help with cost-sharing expenses like copayments, coinsurance, deductibles, and out-of-pocket maximums.
If you think you may qualify for lower premiums or out-of-pocket costs, you can apply for a subsidy at the same time that you enroll in a health plan. You can enroll in a plan through Covered California to get these savings. Important note: Those who qualify for lower cost sharing must enroll in an Enhanced Silver plan; these plans automatically include lower copayments, coinsurance, deductibles, and out-of-pocket maximum limits.
To be eligible for financial assistance, you must:
- Be a U.S. citizen, U.S. national, or legally present in the United States.
- Purchase a health plan through Covered California.
- Not be receiving Medi-Cal, military health benefits, or premium-free Medicare Part A.
- Not have access to affordable coverage through your work.
- Have a household income between 100% and 400% of the Federal Poverty Level. For a family of four in 2015, this would be a household income between $23, 850 and $95,400.
Some individuals with limited income may qualify for Medi-Cal, California’s state Medicaid program. If you’re eligible for Medicaid, you’ll get your health coverage through the program. If you get Medicaid, you’ve met the requirement to have health coverage and won’t face a tax penalty. You won’t need to enroll in a separate health plan. To find out if you’re eligible for Medicaid and to apply, contact the California Medicaid department.
How can I enroll in a health plan in California?
You can apply through Covered California by:
- Submitting an online application on CoveredCA.com.
- Calling 1-800-300-1506 (TTY: 1-888-4500), Monday to Friday, from 8AM to 6PM PT; Saturdays from 8AM to 5PM.
- Applying in person with a certified enroller, insurance agent, or county services agency. Visit CoveredCA.com to get in-person assistance.
- Mailing a paper application.
When you apply for health insurance, you may be asked to provide information such as the following on the application:
- Information on household members who need coverage
- Mailing address
- Social Security information
- Documents that verify U.S. citizenship or lawful immigration status
- Work and household income
- Federal tax information
When can I enroll?
Like the rest of the country, California residents may enroll in a health plan for the upcoming plan year during the Open Enrollment Period, which occurs this year from November 1, 2015 to January 31, 2016.
If you are super broke, Medi-Cal is California’s free public health insurance program for low income individuals and families, the disabled, foster children, pregnant women and people with certain diseases and chronic conditions. Medi-Cal is paid for by the state and federal government and serves over 8 million Californians.
On January 1, 2014, Medi-Cal was significantly expanded to include adults meeting the following income and citizenship requirements:
- U.S. citizen or certain legal immigrant
- Age 19 – 64
- Family income at or below 138% of the federal poverty level
Because of the new rules that expand Medi-Cal eligibility, many Healthy San Francisco participants became eligible for Medi-Cal beginning January 1, 2014. So make sure you go get your proper health coverage today! Just because you’re broke, doesn’t mean your health should suffer!