Health Insurance in California

Are you searching for affordable health insurance in California? Many people are. After all, what’s the point of purchasing health insurance if you can’t afford it? Most people automatically turn to the ACA every year in order to find a comprehensive, subsidized health plan that can meet their and their family’s needs. But not everyone can qualify, and there are other options available for those who can’t. We will discuss multiple sources of health care coverage below, along with their potential benefits and pitfalls. 

Major Medical Insurance in California

In just a few months time, Americans will be celebrating the 10-year anniversary of the Affordable Care Act. The Patient Protection and Affordable Care Act – also known as Obamacare – was signed into law in March of 2010. Since then, it has helped millions of Americans get affordable and life-saving health care coverage. Political efforts to repeal this popular legislation have failed in recent years, so it appears as though the ACA is going to be around for the foreseeable future. 

Open Enrollment for an ACA health insurance plan typically happens between November 1st and December 15th every year – but for the 2020 plan year, Open Enrollment was extended at the last minute to December 18th, 2019. Applying for coverage is fairly simple: all you have to do is go to HealthCare.gov, answer some simple questions about your expected 2020 income and current health status, and wait for a decision. Many people not only qualify for health care coverage, but also qualify for a substantial federal subsidy which makes their coverage realistically affordable.

It costs nothing to fill out an application at HealthCare.gov, so you literally have nothing to lose by trying to apply. And if you qualify, you’ll get a major medical health insurance policy with two very important attributes you can’t find anywhere else: guaranteed issue, and guaranteed Essential Health Benefits. Guaranteed issue means that if you apply for a policy, you cannot be denied coverage based on pre-existing conditions or sex/gender. You also cannot be charged more than the next person for your monthly premiums based on either of those things. As a matter of fact, the only variables which can affect how expensive or affordable your monthly premium is are:

• Your age 
• Your location
• Your use of tobacco products
• Whether you are applying for an individual policy or a family policy

And then there are the guaranteed Essential Health Benefits. when you purchase an ACA policy with guaranteed Essential Health Benefits, it means that your insurance policy will offer you all of the following:

• Ambulatory/outpatient services
• Emergency services
• Hospitalization
• maternity/newborn care
• Mental health and substance abuse
• Prescription drugs
• hab/rehab services and devices
• Lab tests
• Preventive and wellness services and chronic disease management
• Pediatrics (including oral and vision) 

As far as federal subsidies and tax penalties go, there are a couple of new developments happening in California for the year 2020. California is bringing back the individual mandate for State residents starting in 2020. This means that early next year (April 2021) when you file your 2020 taxes, if you choose not to purchase health insurance for the year 2020, you will have to pay either 2.5% of your household income or $696 per uninsured adult in your household – whichever number is larger. But the revenue generated by this change will lower premiums for everyone by about 3.2% on average. 

In addition to implementing an individual mandate and a tax penalty for fiscal year 2020, California is softening income restrictions so that more Californians qualify for a federal subsidy. Now residents who make between 400% and 600% of the federal poverty limit will be eligible for subsidies; in previous years, the limit was capped at 400%. So for the year 2020, California residents making between 138% And 600% of the federal poverty limit will qualify for some sort of federal subsidy. Those making less than 138% of the federal poverty limit will qualify for Medi-Cal. The chart below helps outline (based on household size) whether or not you fall below the 138% federal poverty limit threshold in California. 

If you don’t qualify for a federal subsidy because your income is too low, you can apply for Medi-Cal instead. You may apply online, over the phone, or in person at your local office. You will need the following documents in order to apply:

• Your social security number (or immigration documents if you are a non-citizen) 
• Employer and income information for everyone in your household
• Federal tax information from the head of your household 

The California State Exchange

A few States, California included, have their own state health insurance exchanges where you can also apply for major medical coverage and receive financial help if you qualify. The state exchange in the state of California is called Covered California. The main difference between Covered California insurance and ACA Insurance is that the Open Enrollment periods are different. Covered California Open Enrollment starts on October 15th, 2019 and ends January 31st, 2020.

For more information on applying for subsidized health insurance in California – including Medi-Cal and Covered California – click here. 

Short Term Health Insurance in California

There have been a lot of changes in California regarding short-term health insurance plans in recent years. As of 2019, short-term health insurance was no longer available for sale within the state of California. Considering all of the efforts of the government has gone to in order to make ACA and ACA-compliant coverage easily accessible and affordable for California residents, this isn’t much of a surprise. But if you aren’t looking to be enrolled in one of those plans and still want other options for yourself and your family, don’t worry. You still have some alternatives that you can look into. 

Christian Health Plans/Health Share Plans in California

For several years after the initial passage of the Affordable Care Act, there was an individual mandate which required people to either purchase health insurance through the ACA Marketplace, get a qualifying health care plan from another source (such as their employer), or to pay a penalty each year when filing taxes. These tax penalties were designed to generate revenue for ACA subsidies to help make plans more affordable. But if someone couldn’t or didn’t want to purchase ACA coverage or a qualifying healthcare plan, they had one fairly effective alternative to paying the tax penalty: a Christian health plan. The religious element gave people an exemption from both the (now non-existent) federal mandate and from any lingering state mandates which are still in place.

When you sit down and take a look at the difference between short-term health insurance and a Christian health plan, you may notice several similarities, such as:

• No guaranteed issue
• Unlimited out-of-pocket costs
• Lifetime and annual benefit caps
• No guaranteed Essential Health Benefits
• Plans require a less costly “monthly share amount” than an unsubsidized ACA monthly premium
• Not considered to be a “real” health insurance plan by major organizations and care providers

Yet strangely, for a plan which was originally set up to help exempt people from the individual mandate, there are certain aspects of these health share plans which make them a little less appealing than short-term health insurance. For starters, there’s a lack of a binding contract between you and your provider. With short-term health insurance, if you have a claim dispute, you can take legal action against your insurance provider; with a Christian health plan, you will have no such option – so you have to cross your fingers and hope that they honor their commitment to paying out the benefits that they promise their consumers. In order to participate in a Christian health plan, you have to follow their “participation guidelines”, which usually involves things like:

• Declaring a specific faith
• Quitting tobacco use if you haven’t already
• Adopting other biblically-inspired lifestyle practices

Lastly, there are some differences in jargon between Christian health plans and short-term health insurance. The main reason for these differences are largely legal ones, but are mostly semantic in a practical sense. With a Christian health plan, you don’t pay a monthly premium; you pay a “monthly share amount”. Furthermore, you don’t pay things like co-pays, deductibles, or coinsurance. What you actually pay is something called a “personal responsibility amount” or an “unshared amount”. How much you pay in these amounts and when you pay them will be largely determined by your health insurance plan provider.

Fixed Indemnity Plans in California

The fixed part of a fixed indemnity plan refers to the fact that these plans pay out a fixed amount of money on a predetermined basis. That basis could be per day, per week, per month, per visit, or per incident. It all depends on the plan you purchase, and the company you purchase it from. We should also take a moment to note that these plans are not a sufficient substitute for major medical insurance coverage. It is actually more common for these policies to be sold in addition to major medical. But trying to get by with just a fixed indemnity plan could still leave you with substantial out-of-pocket costs, so it’s important to at least try to look for a major medical plan first, or to pair fixed indemnity insurance with other health supplements for the best coverage you can get. 

Because fixed indemnity plans don’t make any real effort to substitute your major medical coverage, they’re not subject to the same regulations and rules as a typical ACA health insurance plan. In this vein, they have many things in common with short-term health insurance and Christian health share plans. Your fixed indemnity provider can set annual and lifetime benefit caps on the amount of money you receive from them. You will also be subject to medical underwriting, which can increase your premium costs if your provider believes you have a pre-existing condition. Yet some consumers still find that these plans provide a worthwhile value despite their upfront costs, so a fixed indemnity plan may be worth looking into – especially if you are worried about hospital bills.

Discount Cards in California

There are medical discount cards available within the state of California. Keep in mind though that these cards are not a form of major medical health insurance, nor are they an appropriate substitute for legitimate health insurance coverage. As a matter of fact, you can purchase a medical discount card membership even if you already have major medical. They work similarly to something like AARP or a AAA membership. You pay a membership fee on a monthly or annual basis, receive a card through the mail, and present it whenever you get medical care from retailers, doctors, and providers who agreed to honor your medical card discounts.

These cards can save you a decent amount of money on your out-of-pocket medical costs whether you’re completely uninsured or whether the coverage you have doesn’t quite cover everything. But if you purchase the wrong medical discount card membership, the benefits they advertise might not be the best value. Unfortunately, there are scam companies out there who exaggerate the discounts they offer or even straight-up lie about the providers they are affiliated with. If you find a medical discount card program available in your area that sounds too good to be true, make some phone calls. Dig deeper. Find out if the discounts they offer and the providers they claim that they are affiliated with are legitimate. And if it seems like a good deal after you do some detective work, go for it.