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California Insurance News

 

3/3/2013 California suspended enrollment in its Pre-existing Condition Insurance Plan. See this article for news and alternatives.

 

2/22/2013 This page was updated to include a link to the insurance plan that will be used to determine specific "essential health benefits" for insurance that qualified for 2014 federal tax purposes. Also, a link to additional covered benefits required by state law. Non-qualified insurance is likely to continue to be available at a lower cost that does not include these benefits nor qualify for federal tax purposes.

 

8/2/2012 The state is planning a massive advertising campaign for the California Health Benefit Exchange next year that will be ready to launch in January 2014 when Californians will be required to have health insurance or pay a penalty tax. The exchange is supposed to work as an online superstore with purchasing power like Amazon.com. Some express concern over the state's influence in the commercial insurance market or why taxpayer money should be spend advertising commercial products sold by the state. John Graham , director of health care studies for the Pacific Research Institute, is quotes in Wall Street Journal saying "I don't know of a government agency that works like Amazon.com." Until now, all insurance had to be offered under the same terms and prices regardless of where it was purchased. It is not clear whether Californian lawmakers intend to change this part of the law in order to have the state gain a legal advantage in health insurance sales.

 

2/1/2012 The Center for Consumer Information and Insurance Oversight, a division of the Center for Medicare and Medicaid Services (CMS) reported that as of June 30, 2011 Kaiser Foundation Health Plan, Inc., Anthem BC Life & Health, and Blue Cross of California are the state's largest health insurance providers and as such, earn the right to set the benchmark for the development of the state's essential benefit plans to debut in 2014 under health reform law.

 

6/22/2011 A group of 122,000 former Anthem policyholders won a settlement in a class action lawsuit against Blue Shield of California over rates hikes and lack of notification that forced many to drop coverage. These members are now guaranteed eligibility in other lower cost health plans even though the law would not normally require this until 2014.

 

5/26/2011 California's largest non-profit health insurer is facing criticism after government-required disclosure of executive compensation showed that Blue Shield of California's chief executive compensation is more than twice the amount of the largest for-profit insurance company. The highest amount of compensation was $4.6 million and ten executives had pay of more than $749,000.

 

3/30/2011 California considers 15 new health insurance coverage mandates that will likely make major medical insurance less attractive to individuals who purchase coverage.

 

2/12/2011 With dozens of health plans choices available online offering a wide range of pricing and benefits, how do you find the best combination of price and benefits? Celtic Insurance realizes that the choices can be overwhelming; the company offers more than 40 possible health plan designs in many parts of the United States. A new feature called "Help Me Choose" lets users easily and quickly select the benefits they value most and narrows the list down to a few of the best choices. No personal information is required other than zip code and date of birth.

 

2/3/2011 California is named as one of the states most likely to cut back on Medicaid spending and coverage. The Universal Health Insurance blog discusses the impact on the state's commercial insurance consumers.

 

2/1/2011 Rates and applications for broker-assisted California Pre-Existing Condition Insurance Plan are now available for 2011. Applications can be submitted with or without a broker; there is no difference in the premium cost or the coverage. We may act as the submitting broker upon request. The plan information, application forms and rate table are available only through electronic (e-mail) delivery. Application status confirmations and policyholder notices will also be handled electronically.

 

1/30/2011 Patients with health insurance and a credit card now have access to VIP treatment when care is needed at a hospital emergency room. Tenet Healthcare hospitals joined the growing list of hospitals in southern California that allows patients to use a reservation system that books appointments and reduces waiting time in the emergency room. The reservation system makes check-in easier by recording your insurance and payment information in advance. The service costs $15 to $25. Of course the nature unpredictable medical emergencies mean that the service cannot absolutely guarantee that you'll be seen immediately at your appointment time, but you get a full refund if not treated within 15 minutes after arrival. The InQuickER service works in conjunction with any of the private health insurance plans listed here at FreedomBenefits.net but is not available to uninsured patients.

 

Participating hospitals include Loma Linda University Medical Center in Loma Linda, Loma Linda University Medical Center (Children) in Loma Linda, San Antonio Community Hospital in Upland, John F. Kennedy Memorial Hospital in Indio, Fountain Valley Regional Hospital in Fountain Valley, Placentia-Linda Hospital in Placentia, Los Alamitos Medical Center in Los Alamitos, and Lakewood Regional Medical Center in Lakewood.

 

1/19/2011 Child-only health insurance for children with significant medical problems will be available through an open enrollment period mandated by federal state law during the months of January and February and during the child’s birth month. All children, regardless of medical condition, continue to be eligible for insurance when applying as a dependent on a parent’s policy and healthy children are eligible for child-only insurance at any time. When applying for child-only insurance for more than one child, make a separate application for each child.

 

1/11/2011 Consumers will apparently not be immediately affected by new emergency orders by Insurance Commissioner David Jones that threatened to disrupt the availability of insurance. We had feared that companies would stop offering coverage in the wake of the unprecedented regulations by the new regulator but that withdrawal did not happen. Aetna expressed an opinion that the state may not have the authority to override federal health reform rules on minimum loss ratio but the company will not stop offering new insurance policies. A new article "Effect of Minimum Loss Ratio Regulation” provides more information on this topic.

 

1/7/2011 California Blue Shield announced rate increases averaging 30%, with some as high as 59%. A blog "A Closer look at California Blue Shield rate increases" breaks down the issue and offers suggestions on what policyholders can do about it.

 

12/16/2010 California Health and Human Services Agency officials met representatives of 44 other states and numerous employees of the federal Health and Human Services Department in Washington DC this week for a two-day working meeting to discuss the next steps in establish a government-run health insurance exchange under the American Health Benefit Exchange Model Act. Their attendance at this meeting was paid for by a $1 million federal grant awarded by HHS in September to the state for research how to set up an insurance exchange. Two states (Alaska and Minnesota) declined to participate, saying that it was a waste of taxpayer money. Four other states (not identified in press reports) that received federal grants did not send representatives to the meeting. Attendees included representatives of 16 states that are suing the federal government in an attempt to overturn the federal health reform law; specifically the requirement that forces individuals to buy health insurance on the insurance exchange or pay a hefty tax fine.

 

In its initial federal grant request for the insurance exchange project, California said that it would: 1) Establish an Exchange Board and recruit key staff, 2) Analyze the current public and private insurance markets, 3) Convene stakeholders and the general public to gather input, 4) Develop a multi-year plan for Exchange planning tasks, and 5) Collect data on the demographics of the current and projected population, profiles of insurance markets offering coverage in California and estimates of how the Affordable Care Act will change the number of uninsured Californians.

 

The meeting reportedly did not address the role of the commercial health insurance exchanges on the implementation of new competing government systems. The model act does not address inter-state insurance exchange proposals nor insurance sales across state lines. Federal officials admitted that they may not be able to provide further guidance until 2012. Meanwhile, most states are motivated to continue to meet requirements to obtain additional funding promised by the federal government for the establishment of insurance exchange by 2014. Freedom Benefits has previously voiced the opinion that the huge amount of money being spent to set up alternate insurance sales system technologies could be better used providing health benefits to the public. We proposed on the Universal Health Insurance blog that adequate commercial insurance sales systems are already in place that could be modified in a public/private partnership to make health insurance more affordable.

 

11/12/2010 One in ten Californians is now covered by a consumer-directed health plan with high deductible insurance, according to a new report issued by UCLA Health Policy Research. These plans keep health care dollars in the hands of consumers rather than in health insurance premiums and tend to appeal to healthy affluent individuals. Health reform laws could increase the mandated coverage and premium costs but legislative modifications are likely to eventually make high deductible policies the dominant preferred type of insurance coverage in the United States. California currently leads the nation with health plans at the opposite end of the coverage spectrum with almost half of Californians now enrolled in HMOs that the major health care decisions on their behalf. Nationwide, HMOs are far less popular, attracting only about 21% of Americans nationwide. Freedom Benefits Insurance Exchange is committed to offering a full range of high deductible consumer-driven health plans to replace HMOs.

 

11/9/2010 Medi-Cal Expansion - California's Medicaid plan now covers about 7.5 million mostly non-working state residents and will add an additional 500,000 residents by expanding program eligibility to residents with annual incomes up to 133% of the federal poverty level. In some counties the income levels are 200% of the federal poverty level. The program expansion is likely to increase complaints that the state's lower economic class receives better access to health care than the working class especially if federal funding for premium subsidies is withdrawn as expected.

 

9/21/2010 Rate increases for October 2010 - The California Department of Insurance approved rate increases ranging from 14% to 29% for policies from the state's four largest insurance companies that cover a large majority of those who but their own health insurance in the state. The rate increases become effective October 1, 2010 so we anticipate a larger than usual number of healthy members will attempt to move to one of the state's smaller  health insurance plans.

 

8/24/2010 New restrictions for CA insurance shoppers: The California Department of Insurance issued regulations effective August 23, 2010 requiring health insurance companies to thoroughly investigate the histories of those seeking insurance coverage before accepting any premiums. About 1.1 million Californians covered by individual health policies are immediately affected by the department. The rules affect those applying for coverage through the state health insurance exchange as well as those applying though traditional channels. Changing insurance plans could change from a one day process to a 90 day process. Previously insurance companies were allowed to rely on the written statements made by an applicant to determine whether the applicant was eligible for coverage. The new law requires companies to independently verify the eligibility criteria including health history, age, citizenship, residency, eligibility for an employer-sponsored health plan, and sometimes other factors.

 

The most difficult verification is an applicant's medical history. Federal law known as HIPAA makes it difficult, tedious and sometimes expensive to obtain medical records. Doctors and hospitals typically require pre-payment of a medical records fee ranging from $35 to $75. An applicant with multiple medical service providers could incur significant fees and delays in the record transmittal. Insurance companies are allowed to charge the insurance applicant for the cost of obtaining medical records but none of the CA insurance companies we spoke with had announced plans to raise application fees as of this date. Insurance companies have acknowledged that it will take significantly longer to underwrite a policy in California under the new rules.

 

Freedom Benefits is working with the Association of California Life and Health Insurance Companies to stop the new rules and bring the health insurance application process into line with that in all other states. We see no reason that California should adapt a consumer protection policy that is so different from the industry practices followed in every other state in the nation.

 

Five suggestions to Californians who are shopping for health insurance:

 

  • Do not cancel previous coverage or allow the previous coverage to expire until after the new policy has been approved, received and reviewed by you or your insurance adviser. While we understand that many consumers cannot afford to make an additional payment on their former insurance plan - especially when premiums jump sharply - it is important to be aware of the expiration date and the reinstatement deadline (usually 30 days after the expiration date) in order to ensure that the prior coverage is available as a fall-back strategy.

     

  • Use short term medical insurance for immediate issue coverage while waiting for a new policy to be approved. Short term major medical policies are issued immediately online without the need to check medical history because these polices are exempt from the coverage provisions of pre-existing medical policies. As a result, buyers understand the limitations of this simple form of coverage and fewer disputes over claims. See the listing of short term medical insurance plans available in California on the Exchange.

     

  • Collect all of your important documents and copies of all of your personal medical records and keep a digital copy available on your home computer. While the insurer will collect its own information,

     

  • Use limited benefit insurance like Core Health Insurance and supplemental insurance like Value Emergency Room and Value 24 Hour Accident Insurance that is exempt from the new regulations. This insurance is meant to provide benefits in addition to coverage provided by major medical plans but are sometimes used by Californians in a pinch to provide some limited coverage when other insurance is not available.

     

  • Plan ahead for health insurance as if it is the most important part of your personal financial planning. Too many Californians have learned the hard way that lack of adequate health insurance planning can be ruinous. The new health insurance reform laws will amplify that message.

     

The new law was designed to prevent insurance companies from making illegal rescissions, but . Insurance companies are still allowed to cancel policies if an applicant makes an intentionally false statement on an application but also places a new burden of checking the facts in advance. So little is gained in terms of consumer protection and industry officials estimate that the new law could add up to $200 in costs to the price of an insurance policy. California insurance buyers typically change insurance companies every 2nd or 3rd year, according to Freedom Benefits data collected since 1986. A typical health insurance policy, including short term and limited benefit policies, is in force for about 13 months.

 

8/23/2010 State funding planned for insurance exchange: The California state legislator is considering legislation to set up a state-sponsored health insurance exchange that would provide $1 to $2 million per year to help consumers find health insurance online. Presumably a state-sponsored exchange would be able to support a wider range of health plans than the current private insurance exchanges. If approved by the state legislature, part of the cost will be subsidized by the federal government until 2014. Some consumer advocates express concerning taxpayer funds to promote the sale of health insurance yet it is possible that a state-sponsored exchange combined marketing program. The price and terms of insurance is not affected by an exchange and insurance purchased on a state exchange. Federal law allows a state to charge insurance companies for participation in an exchange while there are generally no fees to participate in the current insurance exchange system. OnlineAdviser will continue to provide support for all health insurance listed on any exchange.

 

5/12/2010 Diabetes Coverage: A new resource to help with health insurance for diabetics in California is available.

 

 

 ISSUE BRIEF
1
literacy—puts people at risk of choosing an insurance
product that could fail to provide needed benefits or protect
them financially. Health insurance literacy has been defined
as “the degree to which individuals have the knowledge,
ability, and confidence to find and evaluate information
about health plans, select the best plan for their own—or
their families’—financial and health circumstances, and use
the plan once enrolled.”2
Under the ACA, millions of Americans in 2014 gained
health coverage—many for the first time—through
Medicaid or by purchasing private coverage in the new
federal or state health insurance marketplaces. During
annual open enrollment, people can sign up for coverage
or change their health plan for the coming year—open
enrollment in the marketplaces for 2015 coverage runs
from Nov. 15, 2014, through Feb. 15, 2015.
Measuring Health Insurance Literacy
While most Americans believe they have the knowledge
and skills to choose and use health insurance, many
do not, according to the nationally representative AIR
Health Insurance Literacy Survey3 (see Data Source). The
June 2013 survey of 828 people aged 22-64 who were
uninsured, privately insured or had Medicaid coverage
examined the following four major areas of health
insurance literacy (see Exhibit 1):
„„ Knowledge of health insurance terms and concepts,
types of healthcare services and enrollee rights.
„„ Information-seeking skills, including finding
information, evaluating credibility of sources and
articulating questions.
BY KATHRYN A. PAEZ AND CORETTA J. MALLERY
Under the 2010 Affordable Care Act (ACA), millions of
Americans gained health coverage in 2014 through
Medicaid or subsidized private coverage in state and
federal insurance marketplaces. Coverage is key to
accessing affordable, high-quality care, but consumers
who struggle to understand how health insurance works
and how to estimate out-of-pocket costs are at risk of
going without needed care even if they are covered.1 While
about three out of four Americans aged 22-64 believe
they know how to use health insurance, only about one in
five could correctly calculate how much they owed for a
routine doctor visit, according to new findings from a 2013
national survey by the American Institutes for Research
(AIR) designed to measure health insurance literacy.
Generally, younger people, those who use fewer health
care services, minorities, people with lower incomes and
those with less education have more difficulties navigating
health insurance. Assessing health insurance literacy
can help identify what health insurance aspects pose the
greatest problems for consumers, which groups need more
assistance to enroll and use benefits, and what topics and
skills consumer-counseling efforts should focus on. The
findings that older people and those who use more services
have higher levels of health insurance literacy suggest
that people learn about health insurance by doing, so
creating tools that simulate real-life examples of how to use
insurance are likely to be most effective.
What is Health Insurance Literacy?
Health insurance is among the most complicated and costly
products that consumers buy. Lacking health insurancerelated
knowledge and skills—or health insurance
A Little Knowledge Is a Risky Thing: Wide Gap in What People Think
They Know About Health Insurance and What They Actually Know
October 2014
Amended
A Little Knowledge Is a Risky Thing: Wide Gap in What People Think They Know About Health Insurance and What They Actually Know
2
ISSUE BRIEF
their options before committing to a particular health
plan for an entire year, or they may have an unpleasant
surprise when they use health care services and end up
owing a larger amount out of pocket than expected.
Understanding Plan Type and Calculating
Cost Sharing
When comparing and selecting health plans, 61 percent
of people said they were moderately or very confident
that they could choose the best health plan for
themselves. However, consumers had a weak grasp of
different plan types. About half could identify general
characteristics of a health maintenance organization
(HMO)—for example, “you may need a referral to
see a specialist.” And, only 23 percent could identify
characteristics of a preferred provider organization
(PPO)—for example, “you may have to pay a percentage
of the bill.”
Being able to pinpoint the exact differences among plan
types may not be critical for consumers, but they do need
„„ Document literacy, including completing forms, reading
and following directions, and interpreting summary-ofbenefit
and explanation-of-benefit documents.
„„ Reasoning skills, including assessing personal health
risk and need for preventive care, projecting health
care utilization, and calculating out-of-pocket costs.
Confidence in Choosing and Using a
Health Plan
More than half of all people surveyed were moderately
or very confident in their ability to choose and use a
health plan that is best for their family, but their actual
knowledge was less. Overall, people got an average of
60 percent of knowledge and skills items correct. While
most people could identify common insurance terms,
such as an appeal (80%) and premium (81%), far fewer
could identify more complicated insurance concepts,
such as step therapy (37%) or medically necessary (60%).
Because many people believe they know more than they
do about health insurance, they may not fully understand
Exhibit 1. Domains of Health Insurance Literacy
A Little Knowledge Is a Risky Thing: Wide Gap in What People Think They Know About Health Insurance and What They Actually Know
3
ISSUE BRIEF
Exhibit 2. Calculating Out-of-Pocket Costs
Early in January, Robert visits an in-network doctor to
get a wart removed from his foot. The bill for this visit
is $530, which is the member rate the doctor agreed to
charge his health plan for that service. Robert has a $30
co-pay, a $100 deductible, and 20% coinsurance that
apply for this visit. His co-pay does not count toward the
deductible. How much will Robert pay for the visit?
1. $130
2. $210
3. $236
4. Not sure
Note: The question indicates that the deductible, copay and coinsurance
all apply. The steps to calculate the correct answer are as follows:
1) subtract the deductible and co-pay from the total charge: $530-$100-
$30=$400; 2) calculate the coinsurance: 20% of $400=$80; 3) total the
deductible, copay and coinsurance to determine the amount the consumer
owes—$100+$30+$80=$210.
Source: 2013 American Institutes for Research Health Insurance Literacy Survey
Exhibit 3. Health Insurance Knowledge and Skills
Increase with Age
Source: 2013 American Institutes for Research Health Insurance Literacy Survey
Likewise, people who use health care less frequently had
more difficulties. People without a visit to a physician
in the past year on average got 49 percent of the
knowledge and skills items correct, while those who
saw a doctor a few times a year scored 64 percent (see
Exhibit 4).
Health insurance knowledge and skills also varied greatly
by race, with blacks and Hispanics on average having
less knowledge about health insurance (see Exhibit 5).
Knowledge and skills also decreased with income and
education—for example, people with annual incomes
of less than $25,000 on average got 45 percent of
The correct answer
is No. 2; 20.6% of
respondents answered
correctly.

Insurance
Terms
Plan
Type
Cost
Sharing
Information
Seeking
Percent
Questions
Correct
Age
Health Insurance Knowledge and Skills
22-34
35-44
45-54
55-64
to understand that provider networks differ in size and
rules for in-network and out-of-network coverage vary
among plans.
Three out of four people said they were moderately
or very confident that they have the knowledge to use
health insurance. However, only 20 percent could
accurately calculate how much they would pay for a visit
to an in-network doctor when presented with a costsharing
scenario that included a copayment, deductible
and coinsurance (see Exhibit 2).
Knowing What’s Covered and Where to
Get Help
The ACA took steps to reduce the complexity of shopping
for health insurance, including requiring plans to use
plain language to describe benefits and coverage—
known as the uniform summary of benefits and coverage,
or SBC. The law also provided funding for “navigators”
to assist consumers when applying for coverage and
choosing a health plan in the marketplaces.
Despite these efforts, knowing what’s important when
choosing a health plan, how to use benefits and where to
turn for help can still be challenging. For example, when
comparing plans, most people (79%) were moderately
or very likely to check which hospitals and physician are
covered in each plan, but a sizeable minority (21%) was
only somewhat or not at all likely to consider this basic
plan characteristic when selecting coverage. Likewise,
more than two out of five people (42%) were not at all or
only somewhat likely to check what their plan will and will
not cover before getting health services. And, only slightly
more than half of people were moderately or very likely
to “look to member services to tell you what medical
services your health plan covers.”
Skills Differ by Age, Care Use, Race,
Income, Education
When considering age, race, income, education and
health care use, problems understanding health
insurance terms, plan types and how to calculate cost
sharing were more pronounced. Generally younger
people were less health-insurance literate—for example,
people aged 22 to 34 got an average of 55 percent of
knowledge and skills items correct compared with 63
percent for people aged 55 to 64 (see Exhibit 3).
A Little Knowledge Is a Risky Thing: Wide Gap in What People Think They Know About Health Insurance and What They Actually Know
4
ISSUE BRIEF
Exhibit 4. Health Insurance Knowledge and Skills
Increase with Health Care Use
Source: 2013 American Institutes for Research Health Insurance Literacy Survey
Exhibit 5. Health Insurance Knowledge and Skills Are
Greater Among Whites
Source: 2013 American Institutes for Research Health Insurance Literacy Survey
Exhibit 6. Health Insurance Knowledge and Skills
Increase with Income
Source: 2013 American Institutes for Research Health Insurance Literacy Survey

Percent
Questions
correct
Doctor Usage
No doctor visits in the
past year
One doctor visit in the
past year
A few doctor visits in
the past year
One or more doctor
visits per month in the
past year
Insurance
Terms
Plan
Type
Cost
Sharing
Information
Seeking
Health Insurance Knowledge and Skills

Insurance
Terms
Plan
Type
Cost
Sharing
Information
Seeking
Percent
Questions
Correct
Race/Ethnicity
Health Insurance Knowledge and Skills
White
Black
Hispanic
Other Race

Percent
Questions
correct
Insurance
Terms
Plan
Type
Cost
Sharing
Information
Seeking
Health Insurance Knowledge and Skills
Income Ranges
< $25,000
$25,000- $49,999
$50,000- $74,999
> $75,000
knowledge and skills items correct, while those with
incomes of $75,000 or more got 67 percent correct
(see Exhibit 6). The same held true for education, with
people with less than a high school degree scoring an
average of 32 percent on the knowledge and skills items,
while people with a bachelor’s degree or higher scored
68 percent (see Exhibit 7).
The findings make sense that younger people, those
who use care less frequently, minorities, people with
lower incomes and those with less education have
less knowledge about health insurance because all of
these groups are more likely to be uninsured.4 And, they
are the people most likely to use the health insurance
marketplaces.
Implications
Choosing and using a health insurance plan can be
daunting, especially for people with little experience with
the health care system and health insurance. According
to the 2013 AIR Health Insurance Literacy Survey, many
Americans are unprepared to make informed choices
when selecting and using health plans—especially
younger people, minorities, people with lower incomes
and those with less education.
At the same time, health insurance and benefit structures
are becoming even more complex. As mentioned
previously, consumers likely don’t need to know the exact
differences between an HMO and PPO, but they do need
to consider important health plan characteristics—such
as patient cost sharing, which hospitals and doctors are in
network, and the rules for out-of-network coverage—when
choosing a plan. (See Exhibit 8 for a list of key consumer
considerations when choosing a health plan.)
For the health insurance marketplaces to work, people
need to be able to make informed choices about which
plan is best for them from both health and financial
perspectives and then use their benefits knowledgeably.
An additional challenge is that many of the people using
the marketplaces are at the greatest risk of lacking
health insurance literacy because they tend to be young,
low income, black or Hispanic, and less educated—
all groups that are more likely to have lacked health
insurance historically. Without efforts to increase health
insurance knowledge and skills, many insured people
will remain at risk of forgoing needed care if they don’t
understand how their health insurance works or how to
estimate out-of-pocket costs.
A Little Knowledge Is a Risky Thing: Wide Gap in What People Think They Know About Health Insurance and What They Actually Know
5
ISSUE BRIEF
Exhibit 7. Health Insurance Knowledge and Skills
Increase with Education
Source: 2013 American Institutes for Research Health Insurance Literacy Survey
The findings that older people and those who use more
services have higher levels of health insurance literacy
suggest that people learn about health insurance by
doing. Creating tools that simulate real-life examples of
how to use insurance are likely to be most effective in
improving health insurance literacy. For the least healthinsurance
literate, such efforts might include face-to-face
counseling focused on real-life scenarios that illustrate
key aspects of choosing and using health insurance. At a
minimum, counseling efforts could stress that once
people are enrolled, they should contact their health plan
member services department to get questions answered.

Insurance
Terms
Plan
Type
Cost
Sharing
Information
Seeking
Percent
Questions
Correct
Education
Health Insurance Knowledge and Skills
Some high school
High school degree
Some college
College degree or
advanced degree
Data Source
This Issue Brief uses data from the 2013 AIR Health Insurance
Literacy Survey, a probability sample of 828 people aged 22-64
who were uninsured, privately insured or had Medicaid. Conducted
in June 2013 with a 55 percent response rate, the survey was
used to validate the American Institute for Research’s Health
Insurance Literacy Measure© (HILM), which consists of 21
self-report questions assessing self-confidence and behaviors
associated with choosing and using health insurance. The
HILM was validated with 18 objective, multiple-choice questions
assessing understanding of health insurance terms and concepts,
ability to correctly interpret summary of benefit and coverage
tables, explanation of benefits statements and calculate out-ofpocket
cost from coverage scenarios. The data from the objective
measure are presented in this Issue Brief as percent of correct
responses to the following four categories: health insurance
terms, plan type, cost sharing and information seeking. For a
full description of the measure, see Paez, Kathryn A., et al.,
“Development of the Health Insurance Literacy Measure (HILM):
Conceptualizing and Measuring Consumer Ability to Choose and
Use Private Health Insurance,” Journal of Health Communication,
Vol. 19, Supplement 2 (October 2014).
Notes
1 Dorn, Stan, Implementing National Health Reform: A Five-Part
Strategy for Reaching the Eligible Uninsured, Urban Institute,
Washington, D.C. (May 2011); and Morgan, Robert O., et al.,
“Does Poorer Familiarity with Medicare Translate into Worse
Access to Health Care?” Journal of the American Geriatrics
Society, Vol. 56, No. 11 (November, 2008).
2 Quincy, Lynn, Measuring Health Insurance Literacy: A Call to
Action, Consumers Union, University of Maryland College
Park and the American Institutes for Research, Washington,
D.C. (February 2012); and American Institutes for Research,
Developing a Measure of Health Insurance Literacy:
Understanding Consumers’ Ability to Choose and Use Insurance,
Washington, D.C. (Feb. 19, 2013).
3 Paez, Kathryn A., et al., “Development of the Health Insurance
Literacy Measure (HILM): Conceptualizing and Measuring
Consumer Ability to Choose and Use Private Health Insurance,”
Journal of Health Communication, Vol. 19, Supplement 2
(October 2014).
4 U.S. Census Bureau, Current Population Survey, Health
Insurance Coverage Status and Type of Coverage by Selected
Characteristics: 2013, http://www.census.gov/hhes/www/
cpstables/032014/health/h01_000.htm (accessed on Sept.
30, 2014).
Funding acknowledgement. This research was partially
funded by the Missouri Foundation for Health, an
independent philanthropic foundation dedicated to improving
the health of the uninsured and the underserved.
A Little Knowledge Is a Risky Thing: Wide Gap in What People Think They Know About Health Insurance and What They Actually Know
6
ISSUE BRIEF
✔✔Take time to read each health plan’s summary of benefits
and coverage (SBC). Think about what medical services
you and your family routinely use to make sure those
services are covered. Preventive services, such as an
annual physical or a flu shot, usually are covered 100
percent without any out-of-pocket costs to you.
✔✔ If you don’t understand health insurance terms or the
SBC, get help. A glossary of health insurance terms is
available at www.healthcare.gov. Talk to a marketplace
navigator or assistor or call the health plan to get
answers. Don’t assume you know everything about health
insurance, ask questions.
✔✔Carefully look at the cost-choice trade-offs before choosing
a plan. Lower premiums generally mean less provider
choice and more out-of-pocket costs when you receive care.
✔✔ If you want to keep your doctors or prefer a certain hospital,
make sure they are in-network providers or you usually will
have to pay more or all of the cost of your care.
✔✔ If you have a major illness or injury, will the health plan you
chose protect you financially? Can you afford to pay a $5,000
deductible if you need to be hospitalized, or would you rather
pay a higher monthly premium and have a lower deductible?
✔✔Estimate your family’s out-of-pocket costs for the year—for
example, how many prescription drugs does your family
routinely use? Do you or your family have any chronic
conditions that require regular doctor’s visits or other
services?
✔✔ If the plans you are considering have deductibles, make
sure you understand what counts toward the deductible.
Often, copayments for physician visits, prescription drugs
and other services don’t count toward the deductible.
✔✔To help estimate your out-of-pocket costs, use an online
calculator to estimate what deductibles, copayments
(a fixed-dollar amount for a service) and coinsurance (a
percentage of the total cost of a service) you will have to
pay before the health plan pays for your care.
✔✔Make sure you understand the rules for out-of-network
coverage. Once insured, check to make sure the providers
you want to use are in-network or expect to pay more.
✔✔Once insured, don’t assume your doctor knows the details
of your coverage. Call your health plan member services to
ensure you understand what’s covered. Member services
may be able to recommend a lower-cost provider that
offers the same or better quality services.
Exhibit 8. Consumer Checklist for Choosing a Health Insurance Plan
Source: American Institutes for Research

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Mercer helps clients around the world advance the health, wealth, and performance of their most vital asset — their people. Mercer's more than 20,000 employees are based in 43 countries, and the firm operat...Learn More About Mercer Mercergomj Filter Articles RecentPopularRelevantTopicsTwitterCalendarSign InAbout × Ready, Set…Wait! Is That a Minimum Value Plan? qView Article diTracy Watts kOct 29, 2014 Ready, Set…Wait! Is That a Minimum Value Plan? qArticle dBy: Tracy Watts kOct 29, 2014 ACA With the open enrollment season for January 2015 plan year upon us, or frightfully close, there is a lot of speculation about what really qualifies as a “minimum value” plan. Reports that HHS may update the minimum value calculator to correct a “glitch” have some employers reviewing their compliance strategy. Employers have been getting ready for the ACA employer shared responsibility (ESR) requirements for several years now. The ESR requirements were originally scheduled to go into effect in 2014, but in 2013 regulators delayed implementation until 2015. Mercer survey data suggests that in 2014, most employers were already in compliance with two of the primary provisions — offering a plan that met the minimum value (MV) requirements and had affordable contributions. The one ESR criteria where employers were lagging was in expanding coverage to all employees working 30 or more hours per week. This expansion will come at quite a cost for employers with large numbers of variable-hour employees who were not previously offered medical benefits. The dilemma for companies in this situation has been how to expand coverage to meet the ESR requirements and avoid tax penalties while managing the resulting financial impact to the bottom line. You can count on challenges such as this to generate a market response, and this time has been no different. The market has produced several options that did not exist pre-ACA. The first response was the “skinny medical plan.” These plans include ACA-mandated preventive care paid at 100% (in-network). No other medical coverage is provided (no physician visits, hospital inpatient care, or Rx drugs unless preventive). Skinny plans count as minimum essential coverage (MEC), but don’t meet the minimum value requirement. These plans were very controversial when they hit the market. Based on current guidance, a skinny plan would qualify as MEC and, if offered to all employees working 30+ hours per week, would satisfy the first part of the ESR requirement — allowing employers to avoid the “a” assessment. Mercer’s Survey on Health Care Reform in 2014 showed that about a fourth of employers would consider offering (or already did offer) a MEC plan with an actuarial value of less than 60%. Another plan introduced by the market as a response to the ACA requirements was a MV plan that does qualify as a 60% minimum value plan (using the HHS calculator), but does not include coverage for inpatient hospitalization. Here’s the thinking behind them: The ACA outlines 10 categories of essential health benefits (EHBs) that must be covered by insured plans in the individual and small group markets.Through at least 2015, states were allowed to choose their own benchmark plan to define EHBs.Large insured or self-funded group health plans are not required to cover any/all EHBs. But, if EHBs are covered, the plan cannot impose annual or lifetime dollar limits on the EHBs (but visit or treatment limits generally okay).Coverage of EHBs is factored into calculating MV…and apparently, a plan can get to an actuarial plan value of 60% using the HHS calculator without covering inpatient hospitalization.Currently, these plans would qualify as MEC and MV and, if offered to all employees working 30+ hours per week with affordable contributions, would satisfy both parts of the ESR requirement, thus avoiding both of the potential assessments. Let’s consider the employee’s perspective to understand the issue with these new market developments. Based on current guidance, both of these new plan offerings satisfy the individual mandate. On the other hand, an individual’s eligibility for subsidized coverage in the public exchange could be compromised if the employee is enrolled in a skinny plan, or is eligible for an employer’s affordable minimum value plan (that excludes coverage for hospitalization), even if they don’t enroll in the employer plan. The question is…will HHS update the calculator? It appears that change is coming, but the timing is unknown. There is speculation that HHS will update the calculator to require coverage of “core” benefits” like inpatient hospitalization. This means your plan would no longer satisfy both parts of the ESR requirement and you may be subject to the “b” assessment if any full-time employee received tax-subsidized exchange coverage. It is probably too late to update the calculator for the 2015 plan year. But don’t be surprised if adjustments are made for 2016. While it is beneficial to be poised to take advantage of the latest market developments, when it comes to the ACA it’s a good idea to have a “plan B” in case things change. ACA Mercer Original Employer Shared Responsibility HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaNew FAQ Approves Use of One HPID Per ERISA Plan qView Article diMercer's Washington Resource Group kOct 28, 2014 New FAQ Approves Use of One HPID Per ERISA Plan qArticle dBy: Mercer's Washington Resource Group kOct 28, 2014 Washington Weekly Employers’ receipt of a single federal health plan identifier (HPID) number to cover all self-insured health components within the same ERISA plan has been approved by the Department of Health and Human Services in a new “frequently asked question” (FAQ10848). The guidance confirms that a sponsor may choose to obtain just one HPID for each ERISA plan. Employers not subject to ERISA, like state and local governments, can use the same single-HPID approach if they sponsor “wrap” plans or similar multiple-benefit arrangements treated as a single plan. In prior guidance, the Department said self-insured plans no longer need to involve an "authorizing official" in the application process. A related system upgrade now allows applicants to request HPIDs without sign-off from a registered authorizing official. Reporting health plan enrollment data for the 2014 transitional reinsurance fee can now begin using the online form made available October 24 on www.pay.gov. Employers with self-insured health plans must register on that site and use the form to submit enrollment counts and schedule fee payments. Although forms are normally due November 15, agency staff stated during a recent Q&A session that the deadline to submit 2014 forms is November 17, since the 15th falls on a Saturday this year. Additional Q&A sessions are scheduled through November 17; participation is available via registration on the REGTAP website. The Administration has opened a new health insurance portal to small businesses (fewer than 50 full time workers) in five states after a year-long delay of the ACA’s Small Business Health Options Program (SHOP) online marketplace for these employer plans. An “early access” version of the program launched over the weekend in Delaware, Illinois, Missouri, New Jersey and Ohio. The limited launch is a warm-up before the small business exchange rolls out for most of the rest of the country on November 15. ACA Mercer Original HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaTransitional Reinsurance Fee Form and Instructions sView Mercer's Take diTracy Watts kOct 27, 2014 Transitional Reinsurance Fee Form and Instructions sMercer's Take dBy: Tracy Watts kOct 27, 2014 ACA As promised, the Federal Government delivered the Transitional Reinsurance Fee Form (2 pages) and instructions (64 pages). They are available at pay.gov. Employers must submit the member counts for self-insured plans by November 15, 2014 (regulators will extend to November 17 since the 15th is a Saturday). Remember, there are multiple options for how to determine member counts. Some carriers are providing reporting support, but don’t assume yours is -- you might need to ask for help. If your carrier is willing to provide member counts, be sure to review which method they are using and confirm if it is best approach for your population. Source: pay.gov Go to full article ACA Fees HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaStudy Shows Health Care Shoppers Like Lower Prices sView Mercer's Take diBeth Umland kOct 24, 2014 Study Shows Health Care Shoppers Like Lower Prices sMercer's Take dBy: Beth Umland kOct 24, 2014 Consumers Health care consumerism hinges on three things: Having pricing information, comparing prices before seeking services, and actually taking price differences into account when choosing a provider. Employers can provide employees with a transparency tool and even give them incentives to use it -- but will employees select lower-cost providers as a result? That’s where the rubber meets the road in terms of cost savings. Fortunately, a new study by Castlight Health, published in JAMA, suggests they will. Castlight, which provides an online transparency tool, analyzed the medical claims of more than 500,000 employees at 18 companies between 2010 and 2013. Those who compared prices before receiving care had lower claim payments than those who didn’t: 14% less for lab tests, 13% lower for imaging, and 1% lower for doctor visits (prices don’t vary as much for doctor visits as for lab tests and imaging). Interestingly, employees chose lower-cost providers even when their own out-of-pocket costs were not affected. This bodes well for the ultimate goal of transparency -- using competition to hold down cost. The bad news? Fewer than one in three plan members in the study actually searched on prices before seeking care. That tells us that communication will be a key factor in the success of a transparency initiative. Source: www.forbes.com Go to full article Health Costs Transparency HelpfulNot Helpful... ×Share on twittercShare on facebookbShare on linkedinaRegulators Eyeing Tougher Minimum Value Test qView Article diMercer's Washington Resource Group kOct 22, 2014 Regulators Eyeing Tougher Minimum Value Test qArticle dBy: Mercer's Washington Resource Group kOct 22, 2014 Washington Weekly In recent meetings with employers, ACA regulators have said that the official online calculator used to determine whether plans meet the “minimum value” test is under review and may be retooled to disallow plans that don’t include in-patient hospital benefits. Any change to the calculator isn’t expected until late this year at the earliest. Employers sponsoring self-insured health plans must by Nov. 15 report the number of covered lives in certain plans via an online interactive government form for purposes of calculating and paying the temporary reinsurance fee required by the Affordable Care Act. The form will be available via pay.gov on Friday, October 24, according to CMS. Employers with self-insured plans should ensure that they, or designated third-parties acting on their behalf, are on track to finish the covered-lives counting in time to meet the filing deadline. To get a federal health plan identifier (HPID), employers with self-insured plans no longer need to involve an "authorizing official" in the application process. A revised quick guide and updated user manual reflect the US Department of Health and Human Services' recent decision to streamline the HPID process so a company executive doesn't have to register and approve each application. A related system upgrade now allows applicants to request HPIDs without sign-off from a registered authorizing official. ACA Mercer Original HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaUninsured Unaware of Open Enrollment sView Mercer's Take diTracy Watts kOct 21, 2014 Uninsured Unaware of Open Enrollment sMercer's Take dBy: Tracy Watts kOct 21, 2014 Public Exchanges As employers, we all know how hard it is to get our employees’ attention. Looks like the government is having an equally hard time getting the attention of their target audience – the uninsured. A new study by Kaiser Family Foundation reports that 89% of the uninsured are unaware that open enrollment begins in November. The survey also reveals low awareness of the public marketplace, plan options, and affordability. Perhaps with the November 1 launch of open enrollment for the public exchange, we will begin to see mass marketing efforts in the way of TV ads and signs on the sides of busses. But If you have non-eligible employees who might benefit from the public exchange, don’t assume they know all about it. A little extra communications effort now might help your workers take that important first step of learning about their exchange options. Source: kff.org Go to full article Public Exchanges Enrollment HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaBehind in Pay, Behind in Benefits qView Article diBeth Umland kOct 17, 2014 Behind in Pay, Behind in Benefits qArticle dBy: Beth Umland kOct 17, 2014 By the Numbers It’s well known that working women earn less money than their male counterparts, but they may also be at a disadvantage when it comes to health benefits. Using data from Mercer’s National Survey of Employer-Sponsored Health Plans, we compared companies with workforces that are 65% female or more to those with workforces that are 65% male or more. About half of the mostly female companies are in health care and about a quarter are in the services sector, while mostly male companies are found predominately in manufacturing. The percentage of employees in collective bargaining agreements is about the same for the two groups, at just under 15%. Not surprisingly, when the workforce is mostly female, the average salary is about $10,000 less than when the workforce is mostly male. Pay and benefits tend to go hand in hand. The health benefits at organizations with predominantly female workforces are also less generous than in those with predominantly male workforces. Because women generally use health services more than men, the disparity in benefit levels has an even greater financial impact. Women use maternity services, and childbirth, the leading cause of hospitalization in the US, accounts for a quarter of all hospital stays. We found that average employee contributions as a monthly dollar amount are higher in mostly female companies: For coverage in a PPO, the most common type of medical plan, the monthly contribution for family coverage is 31% higher. In addition, average in-network and out-of-network deductibles and out-of-pocket maximums are consistently higher. For example, the average in-network PPO deductibles in mostly female companies are $727 and $1,614, respectively, for individual and family coverage, compared to $557 and $1,318 at mostly male companies. And the benefit gap doesn’t end with active employment. Mostly male companies are also more likely to offer retiree medical benefits — 27% offer medical coverage to pre-Medicare-eligible retirees, compared to just 19% of the mostly female companies. The Affordable Care Act (ACA) targeted some health plan coverage practices that discriminated against women. For example, health plans are now required to cover “essential benefits,” which include maternity and newborn care, an annual mammogram for women starting at age 40, and domestic violence screenings. Due to the ACA, most women enrolled in employer-sponsored plans now have access to free contraception. In addition, in 2015, when the Employer Shared Responsibility mandate goes into effect, more US employees will have access to employer-sponsored coverage as companies are required to extend coverage to all employees working 30 or more hours. The industries most affected by this new rule are those with large populations of part-time workers — which also tend to be industries that employ a lot of women. Currently, about a third (36%) of companies with mostly female workforces do not provide coverage to all employees working an average of 30 or more hours per week. They will be required to do so in 2015. It is important for all employers, and especially those with largely female workforces, to understand the difference in how men and women use health benefits to ensure that plans meet their needs in an affordable manner. One solution may be to offer a range of choices that allow workers to choose between plans with lower premium contributions and higher deductibles, and plans with higher up-front cost but lower cost sharing. Thoughtful dependent coverage tiers and salary-based contributions can also address equity concerns. Because women use health benefits more, it stands to reason they value them more. For employers with a mostly female workforce, the right health benefit package might be the key to a more engaged, productive, and loyal workforce. Alyssa Grabfield from Mercer conceived and performed the data analysis and assisted with the reporting. Mercer Original Research Employee Benefits HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaCost Growth Down? Give Employers Credit for Their Hard Work sView Mercer's Take diTracy Watts kOct 16, 2014 Cost Growth Down? Give Employers Credit for Their Hard Work sMercer's Take dBy: Tracy Watts kOct 16, 2014 Employer Actions Bloomberg published an interesting piece on the impact of Obamacare on corporate America that quoted a White House economist as saying that the slowing of the health care cost trend is “one of the most under-appreciated economic trends relative to its importance.” My response is that all the hard work employers are doing to manage costs, drive improved consumerism and quality of care is under-appreciated! The ACA had required employers to expand benefit eligibility, starting with the initial requirement to cover adult children up to age 26, which was a significant increase of covered lives for employers, and to enrich benefits by covering preventive care at 100% and eliminating lifetime maximums and dollar limits on services, to name a few of the requirements. At the same time that employers made these enhancements, they managed to keep cost growth below the annual 6% increases employers had all been “living with” prior to the ACA. Why? Because each year employers have worked harder to better hoan their programs to take advantage of the latest developments in consumer engagement, wellness, medical homes, condition management, and other innovations. We all know that our employees and their families are paying a bigger portion of the bill, too. All the efforts are paying off. But, unfortunately, we can’t let up – looming ahead is the Excise Tax in 2018. Source: bloomberg.com Go to full article Health Costs ACA HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaHealthcare.gov: What To Expect This Time Around sView Mercer's Take diTracy Watts kOct 16, 2014 Healthcare.gov: What To Expect This Time Around sMercer's Take dBy: Tracy Watts kOct 16, 2014 Public Exchanges This article is a good comparison of the government’s enrollment site last year to the new, improved version being rolled out this year. There are a couple of noteworthy points for employers. First, it will be easier to “window shop” plans if you want to look and see how the public offerings compare to employer-sponsored plans. Secondly, the article points out that the lowest penalty for not having coverage under the individual mandate – just $95 last year -- is going up to $325 in 2015, with the actual penalty calculated as a percentage of income. This may spur more individuals with access to an employer plan to enroll. The window for the public plans opens Nov 15 and goes until February. However, for coverage to be effective January 1, elections must be made by December 15. That’s about the same length as most employers’ open enrollment periods, and it will happen at approximately the same time. Fingers crossed this open enrollment will go more smoothly than last year! Source: washingtonpost.com Go to full article Public Exchanges Enrollment HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaUnderstanding the New FAQ on Reference-Based Pricing qView Article diTracy Watts kOct 16, 2014 Understanding the New FAQ on Reference-Based Pricing qArticle dBy: Tracy Watts kOct 16, 2014 ACA Plans that implement reference-based pricing (RBP) set a maximum amount payable for specific procedures. Higher-than-normal cost sharing applies for providers charging above reference price. Employers using or considering RBP need to stay on top of ACA rules and guidelines to avoid potential compliance problems: The ACA set limits on out-of-pocket expenses for non-grandfathered plans ($6,600 for individual coverage; $13,200 for other than individual coverage).An FAQ issued on May 2 indicated that a large insured or self-insured group using RBP would not be considered as failing to comply with the out of pocket limits as long as the plan uses “any reasonable method” to ensure adequate access to quality providers.The new FAQ specifies factors to determine if the use of RBP is “reasonable,” which would presumably allow the plan not to count costs beyond the RBP against the out-of-pocket maximum.So what do employers need to keep in mind with RBP to keep it “reasonable”? Type of service: Plans must offer the member sufficient time to make an informed choice of provider after the need for care has been identified; RBP cannot be applied to emergency services.Reasonable access and quality standards: Plans must have an adequate number of providers that accept the RBP and ensure those providers meet reasonable quality standards.Exceptions process: Plans must establish an exceptions process that is easily accessible by members.Disclosures: Plans must automatically provide information about the pricing structure, a list of applicable services, and the exceptions process. Upon request, plans must provide a list of providers that will accept the RBP, a list of providers that will accept a negotiated price above the RBP and the underlying data used to ensure an adequate number of providers who accept the RBP meet reasonable quality standards.More employers are using RBP — should you? According to Mercer’s survey data, in 2013, 10% of large employers (500+ employees) used reference-based pricing, and 22% were considering it. This strategy is more common among larger employers, and that’s where we’re seeing growth. Among employers with 10,000 or more employees, 15% used reference-based pricing in 2013, up from 10% in 2012. An additional 30% say they are considering it. Why all the interest in RBP? There is huge variation in cost for some medical services from one provider to the next. Worse, most often patients don’t know how much a service will cost even when they are at the doctor’s office — they find out only when they receive an explanation of benefits (EOB) in the mail weeks after the care was provided. RBP provides an incentive to the consumer to review pricing information in advance and to select a provider accordingly. Employers typically start off with a short list of services/procedures for RBP and expand as members gain experience with the approach and learn to use tools to support decision making. Services where we see great cost variation without much variation in quality — like an MRI — are often the focus of an RPB strategy. And a side benefit of RBP is that, once it has been introduced in a community, you often see the highest-cost providers lowering their prices so they don’t lose business. RBP is all about transparency, an issue of growing importance to both employers and employees, who, as out-of-pocket costs rise, are more interested in information on the cost of services because they may be paying for it themselves. The market is responding to the new demand. There are now several specialized vendors providing this service and most insurance companies have built (or contracted for) a tool. This makes it easier for employers pursuing RBP to meet the requirements for providing a “reasonable method” for finding and accessing quality providers. Transparency is not just about the price. Many of the transparency tools also include access information and some type of quality indicator. A best practice would be to pair pricing transparency with medical decision support, to convey the message to employees that now that they know how much the treatment costs, they might be interested in knowing more about alternatives to consider. Best-in-class transparency tools can also alert members to cost-saving opportunities without them ever needing to initiate a search, and even target messaging based on member searches. For example, a member who searches for information on pregnancy would receive maternity management program pop-ups. Reminders about employer-specific programs (health assessments or onsite/near-site services, for example) can be sent as well. I will be interested to learn if employers think the most recent FAQ on “reasonable” application of RBP is supportive of medical management and consumerism techniques — or viewed as an additional constraint that makes the effort less worthwhile. For employers in the latter camp, I would encourage at least looking into transparency tools to see if they can smooth the way. Health Costs ACA Mercer Original HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaShopping for Health Plans at Wal-Mart sView Mercer's Take diBeth Umland kOct 16, 2014 Shopping for Health Plans at Wal-Mart sMercer's Take dBy: Beth Umland kOct 16, 2014 Consumers From now through early December, shoppers at 2,700 Wal-Mart stores across the country can step up to a counter and speak with a licensed agent about health plan options. Targeted at those in the market for a Medicare plan as well as customers interested in the public exchange, the service overlaps with the enrollment periods for those two programs. Wal-Mart is partnering with DirectHealth.com, an online insurance comparison site. DirectHealth agents will provide information on thousands of plans offered by hundreds of carriers, and will receive a commission if an in-store customer enrolls in a plan. For employers located near a Wal-Mart offering the service, called “Healthcare Begins Here”, it’s another possible source of health plan information and guidance for non-benefit-eligible employees and retirees. Of course, your eligible employees also might decide to “shop” for health insurance to see what else is available – which will likely help them appreciate the value of their employer-sponsored plan! Source: washingtonpost.com Go to full article Public Exchanges Enrollment HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaNew Guidance on Reference-Based Pricing and Health Plan IDs qView Article diMercer's Washington Resource Group kOct 14, 2014 New Guidance on Reference-Based Pricing and Health Plan IDs qArticle dBy: Mercer's Washington Resource Group kOct 14, 2014 Washington Weekly A raft of guidance issued last week addresses several ACA topics: the interplay of reference-based pricing and the out-of-pocket (OOP) cost-sharing limits, the health plan identifier mandate administered by the Department of Health and Human Services (HHS), and the IRS forms employers will use for the law’s play-or-play and minimum essential coverage reporting. Updating prior guidance on cost-sharing limits, a new set of “frequently asked questions” (FAQs) outlines the specific issues regulators will consider when evaluating whether a plan that uses reference-based pricing (or a similar network design) is using a “reasonable method” to ensure that it provides adequate access to quality providers at the reference price. Some plan sponsors and insurers use, or are considering incorporating, reference-based prices into their plan designs to curb rising costs. This approach may require some covered individuals to pay higher out-of-pocket costs for in-network charges exceeding the specified reference price. Another set of FAQs from HHS about health plan identifiers generally confirm information contained in the rules and on website materials, but make it clear that health savings accounts and health flexible spending arrangements – regardless of size – are exempt from the mandate. Additionally, according to the FAQs, health reimbursement arrangements (HRAs) that cover only other plans' deductibles or out-of-pocket costs do not require HPIDs. The FAQs also clarify that sponsors now may authorize TPAs and similar entities to seek plans' HPIDs. Insurers and self-insured plan sponsors must obtain the HPIDs by Nov. 5. Finally, IRS has posted revised draft forms for ACA's play-or-pay and minimum essential coverage reporting. The Oct. 1 and Oct. 2 versions replace four draft forms in the 1094 and 1095 series issued in July and August. The Aug. 28 draft instructions for these forms have not changed. Employers, insurers, and others will use the finalized forms to report on individuals' plan eligibility and coverage, as well as employees' full-time status. ACA Mercer Original HelpfulNot Helpful Expand Story Share on twittercShare on facebookbShare on linkedinaPublic Exchange Open Enrollment Strategy for Year 2 sView Mercer's Take diTracy Watts kOct 13, 2014 Public Exchange Open Enrollment Strategy for Year 2 sMercer's Take dBy: Tracy Watts kOct 13, 2014 Public Exchanges The Wall Street Journal ran a story about the challenges expected during the second open enrollment period for the public exchange. The individuals who signed up during the successful first-year enrollment are referred to as the “low hanging fruit,” and it’s expected that the remaining uninsured will be harder to convince to enroll. Of interest is that four out of ten people said they enrolled because of the individual mandate, according to a recent study. One of the marketing strategies for this open enrollment season will be to focus on the legal requirement and the tax penalty imposed on those without coverage. Employers did not see much change in enrollment in 2014 when the individual mandate first went into effect, but it’s possible that this marketing campaign -- along with the higher tax penalty -- will have an impact on enrollment in employer-sponsored plans for 2015. It’s a good thing to keep an eye on. Source: online.wsj.com Go to full article Public Exchanges Enrollment HelpfulNot Helpful Expand Story cbaMercer Marketplace Offered to Nearly 5 Times More Lives qView Article diBeth Umland kOct 13, 2014 Mercer Marketplace Offered to Nearly 5 Times More Lives qArticle dBy: Beth Umland kOct 13, 2014 By the Numbers It’s going to be a busy open enrollment season for Mercer Marketplace. In 2014, its first year of operations, Mercer’s private benefits exchange provided access for 52 companies, with 220,000 eligible employees, retirees, and dependents. For 2015, those numbers have grown by about a factor of five: 247 companies have chosen Mercer Marketplace to provide access to more than 1,000,000 lives. Additional enrollments for 2015 will continue throughout 2014. “The growth in people and companies attracted to our exchange platforms is a powerful demonstration of the broad applicability of Mercer Marketplace solutions,” said Julio A. Portalatin, our President and Chief Executive Officer. “Our clients and their employees are confirming that we offer the most flexible and complete private exchange in the market that meets the real needs of a wider spectrum of companies. Further evidence of our momentum is the acquisition of 40 new clients not previously served by Mercer’s health business in addition to our continued growth with existing clients.” A 2014 analysis of purchasing behavior on Mercer Marketplace showed that, given the opportunity to choose from a range of benefit options, many consumers purchased lower-cost medical plans. That, combined with access to Mercer Marketplace network arrangements, care management and prescription drug programs, allows employers to achieve up to 15% medical plan cost savings. In addition, Mercer Marketplace drove an average savings of 10% on the cost of life and disability benefits. These savings are enjoyed by both employers and employees. “These savings result from Mercer Marketplace’s purchasing power combined with consumer decisions to purchase coverage that is more appropriate to their personal needs,” said Sharon Cunninghis, Mercer Marketplace Leader. “The fact that employers were able to achieve significant cost savings while offering their employees the ability to personalize their benefits is exciting news. This satisfaction from both companies and individuals gives others confidence in the exchange experience and positions this as one of the standard benefits models of the future.” In addition to the employer active and retiree clients, several companies have selected Mercer Marketplace as the platform for delivering voluntary benefits, with 330,000 employees (730,000 lives including dependents) eligible to select benefits through this program. Mercer also provides access to individual medical insurance coverage to an additional 750,000 individuals through our relationship with GetInsured. While enrollment in these offerings may initially be modest, using Mercer Marketplace for delivery of voluntary benefits and individual medical insurance provides an avenue for both employers and employees to begin to experience the advantages the exchange platform offers. Mercer Original Private Exchanges Enrollment Mercer Marketplace HelpfulNot Helpful Expand Story cbaAre You Winning the War on Cost in 2015? sView Mercer's Take diTracy Watts kOct 10, 2014 Are You Winning the War on Cost in 2015? sMercer's Take dBy: Tracy Watts kOct 10, 2014 ACA This week, the government announced that Medicare premiums will remain flat in 2015. According to the Office of Personnel Management, medical premiums for plans that cover federal employees and retirees is expected to go up 3.2% in 2015. This is nearly on par with preliminary results from Mercer’s 2014 National Survey of Employer-Sponsored Health Plans showing a 3.9% increase in costs in 2015 for employer-sponsored health plans. On the other hand, the projected increase for public exchange plans, based on 38 states so far, is higher, at 6%. What’s driving the lower increases? Some attribute to the effect of the ACA; others think it is the weak economy and people are seeking less care. As an employer, how does your increase for 2015 compare? If not in the ballpark with these stats, check out our post last week on 25 Best Practices that Could Lower Plan Costs. Source: online.wsj.com Go to full article Health Costs Employee Benefits HelpfulNot Helpful Expand Story cbaIncentives Can Be Tricky Business sView Mercer's Take diBeth Umland kOct 10, 2014 Incentives Can Be Tricky Business sMercer's Take dBy: Beth Umland kOct 10, 2014 Wellness This Wall Street Journal article highlights what many employers with a health management program already know: incentives can be tricky business. Financial incentives may get more employees to complete health assessments, but will they get employees to lose weight? And will employees feel coerced, rather than encouraged, to improve health habits? Now, in addition to the questions of how to structure incentives to achieve desired goals, employers also have to worry about whether the programs will invite legal or ethical complaints. Two lawsuits have been filed by the EEOC against employers using health management incentives, alleging violations of the Americans with Disabilities Act. At the same time, the federal government has signaled approval of the use of incentives by raising maximum incentive amounts under the ACA. Financial incentives have been shown to improve participation rates. To avoid alienating employees -- and potential lawsuits -- employers need to make sure to offer enough alternatives so that all employees are capable of earning the incentive if they choose to take action. Source: online.wsj.com Go to full article Plan Design Wellness HelpfulNot Helpful Expand Story cbaEmployers Should Plan for ACA Reporting for 2015 and 2014 qView Article diTracy Watts kOct 8, 2014 Employers Should Plan for ACA Reporting for 2015 and 2014 qArticle dBy: Tracy Watts kOct 8, 2014 ACA Administrative burden tops list of employers concerns For the first time since the law was passed, the administrative burden of ACA compliance surpassed the excise tax as the top concern for employers in Mercer’s seventh health care reform survey, conducted in January of this year. Since then, the government has issued the final regulations, draft forms, and instructions to comply with the 6055/6056 reporting requirements. We polled US employers about the requirements during a Mercer Select web briefing this week. More than half of them said they don’t yet know how they will comply; a third plan to complete the reporting in-house (at least for now), and the rest will rely on their benefits administration vendor, payroll vendor, or other third party. The biggest employer concerns about the reporting requirements were getting a system in place for 2015 and obtaining the required data from various sources. The focus of the web briefing was on reporting in 2016 for 2015. But wait…2014 may not be an EZ tax season H&R Block is busy training tax preparers for the new complexities of filing for 2014. The upcoming tax season could be hectic for employers, too. All American income tax filers will be required to check a box on their 1040 indicating whether they had minimum essential coverage (MEC) in 2014 to show they complied with the ACA individual mandate. Instructions for what to do if you are not able to check the box have not yet been released. Those that received an advanced premium tax credit from a public exchange or want to claim the credit with their filing will have to ditch the Form 1040-EZ for the longer 1040 or 1040A and attach Form 8962 to verify their eligibility for the credit.Those who didn’t have MEC and believe they are exempt from the individual mandate will have to attach Form 8965 to claim the exemption. A potential reason for exemption is that affordable coverage wasn’t available to them. There have been several news stories recently that detail the complexities of filing for an exemption with the IRS or through healthcare.gov.Those filing either form who were eligible for employer-sponsored coverage will need to know whether their employer coverage was affordable and provided minimum value. Let’s be honest, most of your employees aren’t going to remember that you gave them information about MEC and minimum value on page 4 of their Summary of Benefits and Coverage (SBC). And, they aren’t going to remember the 2014 monthly premium for their lowest-cost health insurance option for purposes of the affordability calculation. The vast majority of your employees are not even going to know they need this information until they begin to file their taxes. Can you hear the phone ringing? I recommend that you include a reminder in your employee W-2 communication that advises employees that they will have to provide information on their health coverage in 2014 when they file their taxes. You should remind them that if they were eligible for benefits, they were offered coverage that met the MEC requirements and provide the monthly amount of the lowest-cost premium for employee-only coverage — and/or direct them to where they can find the SBC and 2014 premium rates. Having this information, along with eligibility definitions, posted somewhere that is easily accessible by employees during the upcoming tax season, could save you a lot of phone calls. ACA Mercer Original Benefits Administration HelpfulNot Helpful Expand Story cbaWhat’s Different About a Full-Replacement CDHP qView Article diBeth Umland kOct 7, 2014 What’s Different About a Full-Replacement CDHP qArticle dBy: Beth Umland kOct 7, 2014 By the Numbers Health reform has accelerated employer adoption of consumer-directed health plans (CDHPs). More than a third of all large US employers (500 or more employees) — and nearly two-thirds of jumbo employers (20,000 or more employees) — offered an account-based CDHP in 2013. However, because CDHPs are usually offered as an option alongside PPO or HMO medical plan choices, enrollment remains relatively low, at 18% of all covered employees. CDHP coverage costs 15% less, on average, than PPO coverage, and 18% less than HMO coverage, but limited enrollment translates to limited savings. Some employers have already taken the step of offering a CDHP as the only plan, and more are considering it. While just 6% of all large employers offered a full-replacement CDHP to employees at their largest worksite in 2013, 16% say they will do so by 2016, as shown in the chart above. That figure rises to 29% among the jumbo employers. But do employers that offer CDHPs as a full replacement see the same level of savings as when the plan is offered as an option? And, in designing a full-replacement plan, do employers take into account the fact that the plan must now work for all employees, rather than the minority who typically select it? To find out, we analyzed data from Mercer’s National Survey of Employer-Sponsored Health Plans to compare HSA-eligible CDHPs offered as a full-replacement strategy to those offered alongside PPOs or HMOs. Full-replacement CDHPs tend to have richer plan designs than CDHPs offered as an option. When a CDHP is the only plan, employers are more likely to make a contribution to a health savings account (77%, compared to 70% of those offering a CDHP alongside a PPO or HMO), and the contribution amount is higher (the median employer account contribution for a family is $200 higher when the HSA plan is offered as a full replacement). Deductibles are about the same, but prescription drug benefits are more often covered at a separate, higher benefit level (67% of full-replacement plans, compared to 57% of plans offered as a choice). And employers with full-replacement plans go to greater lengths to explain the plan to employees and help them to use it (24% say their communication efforts are “very extensive,” compared to 15% of employers with optional CDHPs). But employers offering CDHPs as a choice require lower contributions. While full-replacement plan design is richer, without the need to entice employers to select the CDHP over other plan types, employee contributions are higher. The average employee contribution requirement for full-replacement HSA-eligible plans are $82 and $268, respectively, for employee-only and family coverage, compared to $64 and $244 for plans offered as an option. Many assume you lose most of the savings with full-replacement…not true! Some critics of the CDHP model have argued that CDHP savings are due at least in part to risk selection — younger, healthier people opting to enroll in the CDHP. However, as shown below, the average per-employee cost for a HSA-eligible CDHP offered as a full replacement — in which risk selection is not a factor — is only 7.5% higher than for an optional CDHP. And it’s still 15% less expensive than the average PPO plan. Average Per-Employee Medical Plan Cost Plan Design Health Costs Mercer Original HelpfulNot Helpful Expand Story cbaChoosing To Make a Choice sView Mercer's Take diBeth Umland kOct 7, 2014 Choosing To Make a Choice sMercer's Take dBy: Beth Umland kOct 7, 2014 Consumers Last week I wrote about a study that found that employees spend far more time selecting a computer or television than they did researching their health plan options. This New York Times article goes further to explain why that is. When people are confused by too many choices, or the differences between plans aren’t clear, they tend just to stick with what they have. Passive enrollment, of course, makes that the easiest course of action. However, staying in the same plan year after year may not be in an employee’s best advantage, and over the long run it can raise costs by reducing competition. This is a concern for the public exchanges, but employers can experience this effect as well. While giving employees more choice is a good thing, it must be done thoughtfully. Decision support tools can help. Source: www.nytimes.com Go to full article Public Exchanges Enrollment HelpfulNot Helpful Expand Story cbaFederal Court Rules Against Subsidies in Federal Exchanges qView Article diMercer's Washington Resource Group kOct 7, 2014 Federal Court Rules Against Subsidies in Federal Exchanges qArticle dBy: Mercer's Washington Resource Group kOct 7, 2014 Washington Weekly Last week a federal district court in Oklahoma ruled that the IRS exceeded its authority in issuing regulations allowing federal tax subsidies for health coverage not obtained from a state-run exchange (Oklahoma v. Burwell). The court, following the reasoning of US Circuit Court of Appeals for the District of Columbia in its now-vacated Halbig v. Burwell decision, concludes that the Affordable Care Act (ACA) clearly limits subsidies to exchanges established by states and therefore does not permit a broader IRS interpretation. In contrast, two other federal district courts and one circuit court have upheld the IRS rule. The Oklahoma judge stayed his decision pending its nearly certain appeal to the 10th Circuit, so premium subsidies in Oklahoma will remain available during this process. HelpfulNot Helpful Expand Story cbaBalancing Work With Holiday Plans and Family Commitments sView Mercer's Take diTracy Watts kOct 3, 2014 Balancing Work With Holiday Plans and Family Commitments sMercer's Take dBy: Tracy Watts kOct 3, 2014 Employer Actions Check out this article in Employee Benefit News for ideas on building loyalty during the holiday season. Many address the need for more flexibility during this busy time with: flexible hours, the ability to work remotely, and planning shift coverage within teams. One suggestion that resonated with me is auto-deletion of email messages (with notification to the to sender) while on vacation, as a way to avoid the dreaded "digging out" upon return from time off. Some good ideas to consider as a way not only to ensure employees use and enjoy their time off, but to provide some "good news" to help balance other benefit messages that might not be as welcome. Source: ebn.benefitnews.com Go to full article Employee Benefits HelpfulNot Helpful Expand Story cbaShould You Spend More Time Picking a TV Than a Health Plan? sView Mercer's Take diBeth Umland kOct 3, 2014 Should You Spend More Time Picking a TV Than a Health Plan? sMercer's Take dBy: Beth Umland kOct 3, 2014 Consumers Here’s a statistic to keep in mind as we head into open enrollment season: 41% of employees spent less than 15 minutes researching their benefit options for 2013. That’s dismaying, considering that Americans typically spend four hours selecting a computer and two hours selecting a TV, both of which cost far less than the $6,000+ most families spend on health insurance in a year – but somehow not terribly surprising. If, like many employers, you’re introducing significant benefit changes for 2015, you might use that statistic in your communications to get employees thinking about how they research their other purchases -- for example, by reading consumer reports and reviews or comparing specifications -- and encourage them to apply similar focus to their benefit options. Source: news.wolterskluwerlb.com Go to full article Research Employee Benefits Employee Communications HelpfulNot Helpful Expand Story cbaModern Health Plans Offer Financial Relief for Higher Ed qView Article diKen Simek kOct 2, 2014 Modern Health Plans Offer Financial Relief for Higher Ed qArticle dBy: Ken Simek kOct 2, 2014 Employer Actions Ken Simek, a partner in Mercer’s Health & Benefits consulting business, and Karen Hutcheson, a partner in the firm’s Talent consulting business, discuss the role that ACA-inspired, updated health plans can have in lessening some of the financial pressures many institutions now face. Higher education institutions are jumping on the bandwagon of employers that are modernizing employee benefits to save much-needed dollars, often with high-deductible health plans as the linchpin in new streamlined benefits packages. Although colleges and universities have traditionally offered richer-than-average health benefits to entice top-notch faculty and staff, a shift is underway. According to Mercer’s most recent National Survey of Employer-Sponsored Health Plans, just 41% of large colleges and universities (those with 500 or more employees) offer a high-deductible health plan today; however, more than three-fourths expect to do so within the next three years. For most, the high-deductible plan will be offered alongside other medical plan choices, but for 10%, it will be the only plan offered. Triggered by the economic downturn, an avalanche of issues face higher education today: Evolving student expectations.Unpredictable enrollments.Heightened scrutiny from all vantage points.Increased pressures to contain tuition and fees.The limiting of established financial-services relationships along with fewer investment options.Added compliance requirements.Changing expectations of the workforce.And now, on top of everything else, the ACA’s hefty 40% excise tax (levied if plan costs exceed $10,200 for individual coverage or $27,500 for family coverage) is staring already-stretched institutions directly in the face for 2018. It’s no surprise that, among the industries queried in Mercer’s most recent health care reform survey, higher education expressed the greatest apprehension about the excise tax, with 80% saying it is a “very significant” or “significant” concern, compared to 63% of respondents overall. Although traditionally slow to change, institutions, large and small, public and private, are beginning to recognize that the can has been kicked to the end of the road; they now must find ways to make benefits more cost-effective. Historically, higher education has tended to offer more generous benefits than many other employers. As recently as 2013, the average total health benefit cost (as a percentage of payroll) was 16.9% for large institutions, compared to 14.6% for other large employers, according to Mercer’s US survey of employer-sponsored health plans. At the same time, in the vast majority of cases, employees’ average contribution for coverage (as a percentage of premium) was found to be notably less for large institutions compared to other types of employers. So how in the post-reform world does higher education modernize without too much compromise? How does it save money while preserving highly valued retirement benefits, accommodating the various needs and different viewpoints among both experienced professionals and up-and-coming millennials, and ensuring the ability to aggressively vie for highly qualified faculty across all disciplines, as well as for skilled talent in IT, development, and other competitive specialties? Health care reform is proving to be the impetus for most institutions to step back and re-evaluate their benefit programs, and the driving force behind a shift toward plans in which faculty and staff have greater individual accountability and choice. At the same time, the ACA’s new 30-hour definition of full time is potentially casting a much wider eligibility net for institutions, which now may need solutions for providing health coverage to much greater numbers. Although the most common approach to cost management is implementing a low-cost, high-deductible plan, a few institutions (primarily in the for-profit sector) are showing an interest in private exchanges as a means to provide greater flexibility, accountability, and cost-effectiveness. Slightly less than one-quarter (22%) of large institutions say they are considering moving active employees to a private exchange within five years. In a private exchange, a high-deductible plan can be one of several medical plan choices that don’t increase the administrative burden on the employer. The reality is, when employees are given the option to buy down on their health benefits, they do so. Early data on consumer buying behavior from Mercer’s own private exchange demonstrate a direct link between cost and accountability: The average value of medical plans pre-exchange was 80.4%, dropping to 71.9% post-exchange, with an average cost reduction per employee of $800. Of that $800, 70% went back into the employer’s pocket, and 30% went into the employee’s. As higher education continues to gain its footing amidst ongoing financial pressures and a barrage of change, flexible, high-deductible health plans can play an instrumental role in modernizing benefits that will help institutions save money while appealing to the needs of an increasingly diverse workforce. ACA Mercer Original Employee Benefits HelpfulNot Helpful Expand Story cbaDeadline Approaching! Your ‘HPID’ Questions Answered qView Article diTracy Watts kOct 1, 2014 Deadline Approaching! Your ‘HPID’ Questions Answered qArticle dBy: Tracy Watts kOct 1, 2014 ACA What is the requirement? By November 5, 2014, many sponsors of self-funded health plans must apply for and obtain a unique Health Plan Identifier number (HPID) from the US Department of Health and Human Services (HHS). Whose idea and why? For more than a decade, the federal government has been moving health plan insurers, group health plans, and health care providers toward standardized electronic formats for common health care transactions. As part of the Affordable Care Act’s reforms, HHS was directed to develop a process for implementing a national health plan identifier system to facilitate electronic transactions. Who is responsible? Insurers are responsible for obtaining the HPID for insured plans. Plan sponsors of self-funded plans are responsible for obtaining the HPID for their self-funded plans, even though many employers engage third party business associates to handle electronic transactions for their health plans. Employers must register on an HHS website and input specific plan sponsor and plan data. HHS will then generate the HPID and provide that number to the applicant. Which self-funded plans must obtain an HPID? A plan sponsor must obtain an HPID for its large “Controlling Health Plan” by November 5, 2014. In general, we believe that many employers will obtain a HPID for each consolidated health and welfare plan for which it files an annual report (Form 5500), if that health and welfare plan includes a self-funded health plan (medical, including carved-out prescription drug or mental health benefits; dental; or vision) which has paid claims of $5 million or more in the prior year. Sponsors of “small” self-funded plans with less than $5 million in claims have until November 2015 to obtain an HPID. So an employer’s first step is to determine whether to obtain an HPID for a particular group health plan. Second, they need to register with HHS, and third, they must apply for the identifier number. Heard about problems with the website? Earlier this year, employers encountered difficulties using the HHS system for generating HPIDs. HHS recently indicated that certain system problems have been addressed and that self-funded plan sponsors may now obtain an HPID. Need more information? An HHS website provides help with the application process including a HPID user manual and a quick guide.

 Overview
If you live in California and either buy your own health insurance or are currently uninsured, this guide is for you. It will help you:

Determine whether you may qualify for a credit to help you pay for health insurance under the Affordable Care Act (also known as Obamacare)
Compare private health plans using U.S. News & World Report's health insurance ratings for California
From now until November 15, the start of the next open enrollment, you cannot get new yearly insurance unless you have a qualifying life event. See below for those options for coverage and how to avoid the penalty.

Do I Qualify for a Tax Break on Health Insurance?
Use the tool at right to determine whether you qualify to receive a tax credit (called a subsidy) that you can use to pay for health insurance. The calculator will also help steer you toward health insurance options that may be best for your needs.

If You Qualify: Plans That Cost Less
Under the Affordable Care Act, you might qualify for a subsidy to help pay for your health insurance. If you qualify, the subsidy can be used to reduce the cost of your monthly premium or can be taken as an annual tax credit. To take advantage of a subsidy, you must choose a health plan that has been approved by the federal government and the government of California. These plans, known as Exchange Plans, meet a set of standards that aim to eliminate benefit loopholes to make sure that people with pre-existing conditions are not being denied coverage.

Note: you had until March 31 to enroll for coverage for the rest of 2014 (enrolling on March 31 would cover you starting May 1). If you missed this date, with few exceptions, you will pay a penalty.

If you missed the deadline to enroll, read about your options for coverage and how to avoid the penalty.
For more information, read Why Get Health Insurance in the State Marketplaces
If You Don't Qualify: Private Plans
If you don’t qualify for a subsidy, you can still choose among the Health Exchange Plans, or consider one of the many private health insurance plans available in California’s private marketplace. We have rated these private plans on a 1-star to 5-star basis, with 5-star plans providing the most comprehensive coverage.  What’s the biggest difference between a private market health plan and a government-approved one? The trade-off is usually cost. Insurance companies can charge less for private plans with less-extensive network coverage or fewer benefits, which makes more-affordable options available to you.

Compare private plans in the U.S. News Health Insurance Ratings for California
Read more here: Hidden Costs of 'Affordable' Health Insurance
Private Health Insurers in California
Anthem Blue Cross of California
Assurant Health
Blue Shield of California
Chinese Community Health Plan
Cigna
Health Net
Kaiser Permanente
Valley Health Plan
Do I Have To Buy Health Insurance?
You may have heard that everyone in California must have health insurance in 2014 or pay a penalty – Obamacare's so-called “individual mandate.” With a few exceptions, this is true. For 2014, not carrying insurance will cost $95 per adult plus $47.50 per child (up to $285 per family) or 1 percent of your family’s income, whichever is more.

U.S. News generally recommends getting health insurance of some kind, even if it is only catastrophic coverage. That's because unexpected medical expenses can easily bankrupt anyone who is uninsured.

See the pros and cons of getting health insurance: Why Do You Need Health Insurance?
For more on the penalty, read Should I Pay the Penalty?
If your health insurance policy was cancelled in fall 2013, you may be eligible to renew it for 2014 coverage. Call your insurer to verify whether your plan is still available. For more info, read Cancelled Health Plans Leave Consumers Puzzled
Where To Buy Health Insurance
California's Official Marketplace
Covered California is California’s official portal for buying an Obamacare Health Exchange Plan under the Affordable Care Act. To sign up online for coverage on Covered California, be prepared to fill out a form that could take 30 minutes or longer. To complete the process quickly, have this info handy:

Social security numbers for everyone in your household
Your employer’s name and address
Your most-recent pay stub or recent records of your wages
Information about other types of income you receive, such as alimony, unemployment benefits or a pension
 
Insurance Companies and Brokers
Some people prefer to buy health insurance directly from an insurance company or through a broker. Thanks to strict regulation, you'll pay the same price for a plan regardless of where you buy it – whether on the Covered California website, through a broker or directly from an insurer – and regardless of whether you sign-up via phone, online, or by filling out paper forms.

U.S. News & World Report has teamed up with GetInsured, an online broker licensed to sell health insurance, to help you buy the subsidized health plan you want. The GetInsured customer service team can answer questions, determine whether you're eligible for a subsidy and help you apply for insurance.

Qualified Plans on Covered California
Beginning October 1, 2013, each state was required by law to have a new online marketplace where residents can buy health insurance. In these marketplaces, most states offer five tiers of Obamacare Health Exchange Plans: platinum, gold, silver, bronze and catastrophic. Platinum plans will offer the highest level of coverage but tend to cost more in monthly premiums. Bronze plans will cover only a bare minimum of health care expenses but tend to have low premiums. If you are relatively healthy and want to pay less up front, consider a lower-tier plan such as bronze or silver.

You should also look at a Covered California plan if you are lower-income, because the government will give financial help on a sliding scale to pay for premiums, and better benefits if you select a silver-tier plan. If you have not already done so, we can tell you if a Covered California plan makes sense given your income. Use the "Shop for Health Insurance Now" section on the top right of this page.

Read ACA and Health Insurance: Which "Metal" Tier is Right for You? for more advice on choosing between metal tiers.

Need More Help?
If you need help choosing a health insurance plan or filling out your application, California has trained nongovernment groups to guide you through the process. Sometimes called “Navigators,” these groups can answer technical questions on insurance, Medicaid, and tax credits (subsidies on monthly premiums) . Navigators also specialize in assisting non-English speaking populations. For more information, contact the Covered California call center at 800-300-1506. The center is open Monday through Friday from 8:00 a.m. to 8:00 p.m. and on Saturdays from 8:00 a.m. to 6:00 p.m.

The California Department of Managed Healthcare exists to help residents resolve issues with their insurance company, locate a doctor or other provider within their network, appeal a denial of service, and resolve billing problems with insurers and providers. The office can be reached at 888-466-2219 or emailed through an online contact form. Residents can file an insurance complaint online.
 

Frequently Asked Questions About Health Insurance
Why Do You Need Health Insurance?
Should I Pay the Obamacare Tax Penalty?
How Can I Save Money on Health Insurance?
What Should Women Look For When Buying Health Insurance?
Are 'Affordable' Health Plans Really Affordable?

 

Understanding navigator support services and options for the California health benefit exchange

 

More than 50 commercial health insurance companies offer individual health insurance in California and 32 companies that issue small group insurance in addition to the state sponsored health plans for low income or disabled residents.. These standard policies may be more expensive than some residents can afford. 

Since the passage of federal health insurance reform law, individuals and small businesses (with less than 50 employees) in California can now purchase health insurance through the federal health insurance clearinghouse or through a number of privately operated insurance exchanges. The state government is likely to expand its own insurance exchange system in cooperation with either the federal or private systems within the next few years. Non-insurance options, like Health Savings Accounts (HSA), Health Reimbursement Arrangements (HRA) and Flexible Spending Accounts (FSA) can be added as effective cost-control tools; ask your adviser for more information. This Web page lists the most popular low cost commercial health insurance plans and related benefits. Freedom Benefits offers personal assistance with any insurance exchange or health reform issue through www.onlinenavigator.org. Please note that while many of these choices could be included in more than one of the suggested usage categories, each plan is listed only once for the sake of brevity. Your enrollment adviser is available to discuss suitability of any plan for your specific situation.

 

For 2014, the federally mandate essential insurance benefit plans will be available through the California Health Benefit Exchange website.

The state insurance exchange is expected to be online by October 2013 with coverage starting January 2014, so individuals without insurance should make arrangements for temporary coverage until then. Covered health benefits under insurance purchased through the exchange in 2014 will be different than those offered though any 2013 health plans. The insurance plan that sets the benchmark for qualified coverage through the exchange is listed here
 and a list of state-mandated benefits can be found here. Commercial exchanges are expected to continue to list less expensive insurance without the essential health benefits.

 

California insurance & benefit news

 

California ranks 26th in health insurance costs compared to all other states, with average premium costs slightly lower than the national average. (The average annual premium for a U.S. family covered under an employer-sponsored health plan in 2008 was $12,298 according to The Commonwealth Fund report. The overall quality of health care ranked 31st out of the 51 states (including DC).

 

The state has the 17th lowest small business health insurance costs in the U.S. according to a 2010 Department of health and Human Services report with an average premium of $913 per month for family coverage.

 

California regulates the benefits required for both individual major medical and group health insurance plans, known as "mandated benefits".

 

Short Term Insurance

 

 Markel Smart STM - popular and affordable short term major medical insurance with fast online approval

 

 Secure STM - along with its 12 month and 36 month options, this may be the highest quality short term coverage

 

California insurance law allows two consecutive 6 month policies and then requires a break in coverage of 63 days before you can reapply with the same company.

 

Intermediate Term

 

 Inbound Immigrant - up to five years of liberal health insurance coverage after immigration including maternity coverage, emergency and other essential benefits

 

Supplemental Insurance

 

 Consumers Direct Accident Medical - Protection UpgradeSMsupplemental coverage for as little as $20 per month.

 

 Consumers Direct Critical Illness Insurance - Secure UpgradeSM $10,000 lump sum supplemental coverage for cancer, stroke or health disease for as little as $25 per month.

 

 Smart Accident Insurance - supplemental coverage for emergency treatment of accidents and injuries for as little as $20 per month. Can be used as a stand-alone accident plan or to increase other insurance benefits.

 

 Value Access Guarantee - everyone qualifies for this plan that pays in addition to any other insurance

 

California insurance law and regulation

 

The California Department of Insurance web site contains a section about protections for consumers who need to resolve claim disputes with to health insurers. The California Major Medical Insurance Program (MrMIP) is the California state high-risk pool. A three month waiting period applies before benefits are provided for pre-existing medical conditions. For 2011 through 2013 the California Pre-existing condition insurance, (PCIP) also managed by the (Medical Risk Insurance Board) is available to those who have a medical condition and have been uninsured for at least six months. The PCIP application may be submitted with or without an agent.

 

The state insurance department can be reached by telephone at 800-927-HELP or by mail at P.O. Box 311, Sacramento CA 95812. The state children's health insurance plan (CHIP) Web site is California Healthy Families.

 

Small business plans

 

 OnlineNavigator offers professional help with the complete listings and rates for federal or state insurance exchange small business group health insurance plans for one low price.

 

Non-insurance Discount Plans

 

 Careington PPO Discount Plans- the nation's leading network PPO discount provider allows a no-risk trial of any discount plan for only a $20 processing fee

 

 Drug Card America - a free prescription drug card that an be used nationwide

 

 Essential Dental Solutions - simple, inexpensive, no waiting period, up to $500 treatment per year

 

 

Telemedicine

 

 CallMD - Doctors and nurses literally on call 24/7 to answer questions, help with medical screening and write prescriptions saving you money with the most common types of medical care. $20 per month covers everyone in the household.

 

 

International Coverage and Travel Insurance

 

 
California health exchange rolls out coverage options
jwhite@sacbee.com
Published Thursday, Feb. 14, 2013

Millions of uninsured Californians will soon be required to buy health insurance or face a penalty, and Wednesday morning they got a glimpse of what to expect.

Covered California, the organization responsible for implementing the federal health insurance overhaul, released a blueprint for what types of coverage will be available on the state's insurance marketplace. The Affordable Care Act requires state exchanges to be up and running by 2014.

Peter Lee, executive director of Covered California, said the exchange will add some much-needed standards and transparency to California's health insurance market.

"They are ready to play by the rules," Lee said of the insurance industry at a news conference. "They are ready to embrace the opportunity to compete not based on a shell game of hidden benefits but based on quality and value."

Federal rules sort available types of plans into four tiers that vary based on factors like cost and scope of coverage.

California goes beyond that requirement by ensuring a standard package that makes it easier to compare plans within a given tier, according to Anthony Wright, executive director of the organization Health Access California.

"Even in states without that extra step it's an improvement over current standards," Wright said. "But as opposed to apples and oranges, we're dealing with McIntoshes and Red Deliciouses."

Every plan available on the marketplace will guarantee a base line level of essential benefits that includes preventive care, prescription drug coverage, pediatric services and mental health treatment.

Insurers will be prohibited from denying coverage or imposing lifetime limits.

James Guest, president and CEO of the organization Consumers Union, said that consumers will benefit from being able to buy insurance without getting entangled in thickets of fine print.

"Not only can California consumers no longer be denied due to pre-existing conditions or other unreasonable restrictions, but now no surprises or gimmicks," Guest said via teleconference.

About 2.6 million Californians are expected to qualify for federal subsidies aimed at making insurance affordable for lower-income Americans.

Lee said he anticipates that an additional 2.7 million uninsured Californians who make too much to receive a subsidy will purchase insurance through Covered California.

The subsidies serve Californians in the middle of the income spectrum, who can get financial help to buy insurance but make too much to qualify for Medi-Cal.

"This is not a poverty program," Lee said, noting that a family of four making up to $94,000 can receive a subsidy.

Those getting subsidies will contribute a percentage of their income, with the government covering the rest. The amount varies based on income: a subsidized individual at the low end of the salary scale could have a monthly premium of between $26 and $78, while someone at the high end could be paying from $260 to $491.

Still unclear is how much Californians who make too much to qualify for a subsidy would pay. Covered California is seeking competitive bids for those plans, a process Lee said should be finished by June.

Medi-Cal – California's version of Medicaid – will also see big changes. The Affordable Care Act expands the number of Americans who can claim Medicaid, with the federal government set to cover much of the cost. Assembly Speaker John A. Pérez has predicted more than 1 million additional Californians will become eligible for Medi-Cal as a result.

This story is taken from Sacbee / 


© Copyright The Sacramento Bee. All rights reserved.



Health Plans Dental Health Plans and Package Options Individual Term Life Insurance Discounts and Rewards Understanding Health Coverage Summary of Benefits and Coverage (SBC) Why Should You Choose Blue Shield of California? print share email Something for everyone Call us to get a quote and apply at (888) 568-3560. Learn more about our individual and family plans. Go Explore your options, compare plans, and enroll. Attend a nearby seminar. More Find individual and family or Medicare plans to fit your needs. We offer HMO, PPO and HSA-compatible medical insurance plans with a range of features. Learn about our dental health plan options for individuals and families, including our HMO and PPO plans. Learn more about how primary subscribers can add the security of individual term life insurance in California at an affordable rate. Learn about wellness discounts and rewards available to Blue Shield of California members. Learn the basics about our affordable health, life and dental insurance plans for individuals and families, including HMO and PPO plans. The Summary of Benefits and Coverage (SBC) Forms, part of the Affordable Care Act, is intended to help consumers understand their health plan coverage. Get an introduction to Blue Shield of California, and learn why you should consider Blue Shield medical insurance as your health plan. Learn about the advantages of health savings accounts and our HSA-compatible high-deductible plans. Go Use this tool to find a Blue Shield of California broker in your area. Go Learn about our strengths and advantages as a not-for-profit health plan.
Individual & Family Medicare Small Business 1-844-842-4345 Chat 24/7 eHealthInsurance - affordable health insurance for individuals, families & small businesses Health Dental Vision Short-term More Resources Hello, Sign in Your Account Cart 0 Home > Medical Plans by State > California Health Insurance California Health Insurance Find Health Insurance in California Compare plans from the best carriers in the Golden State. $3.06 per day plans available 1 Million + Californians served FREE phone support 24/7 Zip Code Get A Free Quote California Medical Insurance Statistics Consider the following statistics about health care coverage in California: Total California Residents - 36,408,713 California uninsured residents - 18.45% Total California HMO enrollment - 15,699,228 Avg annual employee premium in CA employer-sponsored plan (after employer contrib): $741 Avg CA hospital cost per inpatient day (before insurance) - $2,250 Source data according to the Kaiser Family Foundation: Health Insurance Coverage of the Total Population, states (2007-2008), U.S. (2008) Total HMO Enrollment, July 2008 Average Single Premium per Enrolled Employee For Employer-Based Health Insurance, 2008 Hospital Adjusted Expenses per Inpatient Day, 2007 California Health Plans Looking to purchase California health insurance? We offer a broad selection of California health plans for individuals, families and small businesses from most of the leading California health insurance companies. California State Health Resources Residents can also refer to a number of resources within California: California Health Care Services California Health Service's Directory of Health Care Services and Programs California Major Risk Health Insurance Program The California Major Risk Medical Insurance Program (MRMIP) is administered by the Managed Risk Medical Board and developed to provide health insurance for Californians who are unable to obtain coverage on the open market. Recent Blog Posts 11/26/2012 Help us pick the most innovative insurance product of 2012 11/07/2012 "Obamacare" Survey: Small employers don't understand health reform 10/17/2012 How much does Medicare Advantage cost? View more Apply for California health insurance coverage at eHealthInsurance. We offer thousands of health plans underwritten by more than 180 of the nation’s health insurance companies. Compare California health plans side by side, get health insurance quotes, apply online and find affordable health insurance today. Named Kiplinger's best health insurance website '07, '08, '09 CA Insurance Providers Anthem Blue Cross Blue Shield of California Chinese Community Health Plan Health Net Kaiser Permanente of CA Health insurance plans in California are rated by 0 customers. The average rating is out of 5 State Resource Guides California Health Insurance Texas Health Insurance Florida Health Insurance Illinois Health Insurance Pennsylvania Health Insurance Ohio Health Insurance Additional Resources Catastrophic Health Insurance Health Insurance Buyers Guide High Risk Insurance Pools eHealthInsurance is a licensed agency for California health insurance eHealth Insurance Products Health Insurance Medicare Maternity Coverage PPO Plans HMO Plans eHealth Medicare Services Affordable Care Act Medical Plans by State Health Insurance Companies Find a Doctor Other Languages Mobile Customer Service Company About Us Licensing and Legal Privacy Policy verisign TRUSTe Copyright © 2014 eHealthInsurance Services, Inc. Feedback Link

 Anthem makes only small adjustment in rate increase after public scrutiny
News: 2014 Press Release
For Release: October 23, 2014
Media Calls Only: 916-492-3566
Anthem makes only small adjustment in rate increase after public scrutiny
Rate increase still excessive and unreasonable
SACRAMENTO, Calif. - Anthem Blue Cross of California, after facing public scrutiny of its average 9.8 percent rate increase affecting 120,000 members, announced unilaterally yesterday that it is making a minor adjustment to its rate increase. Anthem told reporters its rate increase will be lowered to around 8 percent, despite already having notified small employers of the larger increase.
The Department of Insurance continues to find that Anthem's adjusted rate increase of approximately 8 percent is excessive and unreasonable. Anthem's reduction of the rate increase yesterday is an acknowledgement that the Department of Insurance was correct in finding Anthem's original rate increase excessive and unreasonable. But Anthem's small adjustment of the rate increase, to 8 percent, is not sufficient to make the increase reasonable. The Department of Insurance still concludes that only a 2.1 percent increase is justifiable based on Anthem's claims experience and other data provided by the company.
Yesterday, Insurance Commissioner Dave Jones announced that actuaries at the Department of Insurance had determined that Anthem's 9.8 percent average rate increase was excessive and unreasonable. In particular, the Department found that Anthem's rate increase was excessive due to Anthem's excessive profits, the inflated price trend in the rate filing, the failure to account for the better health status of the remaining members, and the unprecedented use of an accounting maneuver to reduce net income by $75.5 million and hide the level of profitability of the company.
In answering questions from reporters about the excessive rates, Anthem acknowledged that its own data indicated that a reduction of the increased rate was warranted and indicated they would be lowering the excessive rate they had already charged small businesses for October 1 coverage. Only after the commissioner called Anthem out publicly on its accounting maneuver that masks profits did they lower rates at all. Anthem's decision to back-pedal on its rate increase only after media scrutiny demonstrates that insurers have untethered control over rates. Neither the regulator, nor the affected small business owners know what rates Anthem is charging for these health insurance products even after Anthem's acknowledgement that they got it wrong the first time.
"Yesterday, we saw another example of why health insurers should not be able to set its own rates without first publicly justifying the rate and getting approval from a regulator, as is required in 35 other states," said Insurance Commissioner Dave Jones. "Although acknowledging that its original rate was too high and making a minor adjustment in the face of media interest, Anthem Blue Cross is still imposing an excessive and unreasonable rate increase, but there is nothing that I or anyone else can do about it until the law is changed."
Had Anthem revised its rate increase to the 2.1 percent requested by the Department of Insurance, its policyholders would have saved $33 million. This is the fourth time in two years that the Department of Insurance found Anthem charging an excessive and unreasonable rate increase on small employers in California.
California's insurance commissioner has had the authority, since voters passed Proposition 103 in 1988, to reject excessive rate hikes for auto, home and other property and casualty insurance, saving consumers over $100 billion. State and federal law does not provide the legal authority to reject excessive health insurance rate hikes, however.
###

The California Department of Insurance, established in 1868, is the largest consumer protection agency in California, regulating the $123 billion insurance marketplace. In 2013 the California Department of Insurance received more than 170,000 calls from consumers and helped recover over $63 million in claims and premiums. Please visit the Department of Insurance web site at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.HELP or 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.


State Exchange Profiles: California  As of January 3, 2013 Establishing the Exchange

On September 30, 2010, former Governor Arnold Schwarzenegger (R) signed into law two complementary bills, AB 1602 and SB 900, to establish the California Health Benefit Exchange. California was the first state in the nation to pass legislation creating a health insurance exchange after the enactment of federal health reform.1 Current Governor Jerry Brown (D) called a special legislative session in late 2012 to allow the state to draft additional supplementary legislation to implement the Affordable Care Act (ACA) in California. In October 2012, the Exchange announced that its new name would be ‘Covered California.’

Structure: The legislation defines California’s Exchange as a quasi-governmental organization, specifically an "independent public entity not affiliated with an agency or department."

Governance: Covered California is governed by a five-member board, including the Secretary of California Health and Human Services (or designee) as a voting, ex officio member, two members appointed by the Governor, one member appointed by the Senate Committee on Rules, and one member appointed by the Speaker of the Assembly. The legislation specifies that each appointed member of the Board should possess expertise in key subject areas such as, individual or small employer health care coverage, health benefits plan administration, or health care finance. While serving on the Board, members must not be affiliated in any way with a carrier or other insurer, an agent or broker, a health care provider, a health care facility or clinic, or a trade association for these entities. Also, members must not be health care providers, unless receiving no compensation for services provided.

Current Board members are:
Diana S. Dooley (Chair), Secretary of California Health and Human Services
Kimberly Belshé, Public Policy Institute of California
Paul Fearer, Union Bank and Pacific Business Group on Health
Susan Kennedy, former Chief of Staff for Governor Schwarzenegger
Dr. Robert Ross, The California Endowment
The Exchange Board has been meeting monthly since April 2011 and hired an Executive Director who began on October 17, 2011. Covered California has a staff of almost 80 employees.

In September 2012, the Board approved the creation of three key stakeholder advisory groups meant to inform the Board’s policy decisions and shape the implementation of the Exchange. Stakeholder advisory groups will include, Plan Management and Delivery System Reform; Marketing, Outreach and Enrollment Assistance; and the Small Employer Health Options Program.2 In November 2012, Covered California adopted a Tribal Consultation Policy to help structure the relationship between the Tribes and the Exchange, build a partnership, and maximize the participation of eligible American Indians in the Exchange.3

Contracting with Plans: The Board will selectively contract for health coverage offered through the Exchange, “seek[ing] to contract with carriers so as to provide health care coverage choices that offer the optimal combination of choice, value, quality, and service.” California has experience acting as an active purchaser from other programs, such as the Children’s Health Insurance Program (CHIP), small-business purchasing pool, and the state employee purchasing pool. The legislation directs the Board to define minimum requirements that carriers must meet to be considered for participation in the Exchange.

To mitigate the risk of adverse selection, the legislation requires carriers, whether or not they participate in the Exchange, to offer at least one choice at each of the four coverage levels. Catastrophic plans will only be offered by carriers participating in the Exchange. Also, products offered within the Exchange, either for individuals or small employers, must be offered to that population outside the Exchange.

In November 2012, the Board released a final Qualified Health Plan (QHP) Solicitation to carriers for bids to offer, market, and sell QHP coverage through the Exchange beginning in 2013.4 Earlier in the year, the Exchange led multiple stakeholder group sessions with consumer advocates, brokers, and business representatives to gather feedback on plan selection and design issues including, the optimal number of plans with which to contract, network criteria, out-of-pocket cost design, dental and vision coverage, and health system reform. The Exchange released a draft report in July 2012 on QHP options and recommendations based largely on stakeholder feedback.5,6 Initial recommendations on plan and network design included requiring all QHPs to offer all metal tiers, limiting each issuer to propose 2-3 products per geographic region, and standardizing family tiers and tier ratios.

In September 2012, the Board approved using the eValue8 tool, which measures and evaluates health plan performance, as part of the QHP solicitation to support a quality rating system.7

Dental and Vision Benefits: In October 2012, the Board adopted a policy supporting stand-alone pediatric vision plans on the same terms as pediatric dental benefits in both the Individual and SHOP Exchanges. Also, the Board approved offering stand-alone vision plans providing services to adults and children for benefits not offered through the EHB benchmark plan.8

Risk adjustment, Reinsurance, and Risk corridors: The Exchange decided it will initially rely on the federal government to administer risk adjustment and reinsurance programs for the state.

Consumer Assistance and Outreach: The Affordable Care Act (ACA) requires that state exchanges employ Navigators to assist with education and enrollment activities but leaves considerable flexibility for states to define their program. Given California’s complex linguistic and cultural diversity and its size, the state began soliciting broad stakeholder input for an Assister program. In June 2012, Exchange subcontractors released recommendations and a final work plan for Phase 1 and 2 of the statewide Assisters Program.9,10 The report recommends the Assisters program include two distinct types of Assisters registered and certified by the Exchange. Certified enrollment Assisters (Navigators) will be compensated by the Exchange and at a minimum will include, non-profit organizations, community clinics, County Social Services offices employing Eligibility Workers, and labor unions. Direct Benefit Assisters, will not be paid by the Exchange and will include health insurance agents, hospitals, and providers. It is recommended that Certified Enrollment Assisters be paid a compensation of $58 per successful Exchange application and given no compensation for renewals; however, this will be reevaluated prior to the launch of open enrollment in Fall 2013. Training and certification guidelines for both types of Assisters have been developed.

The state procured subcontractors to develop an outreach, marketing, and education strategy and has detailed enrollment goals which have been broken out by potential enrollees’ insurance status and demographic characteristics.11 Between September and December 2012, the state planned to refine their media plan and begin to develop the training curriculum for the Assisters program. Then for Phase II, between January and July 2013, the state plans to begin educating consumers and to begin paid media promoting the benefits of coverage.

Covered California is also planning to use federal funding for an Outreach and Education Grant Program that will engage organizations and entities with relationships with California’s uninsured population to increase awareness and understanding of health coverage options.12 This program will complement the state’s broader marketing strategy and help build capacity for the Assister Program. Grants will be distributed in early 2013.

Small Business Health Options Program (SHOP) Exchange: In October 2012, the state released a solicitation for the Administration of SHOP Operations that is expected to be awarded by early 2013.13 The contract includes maintenance and enhancements of the SHOP Exchange through December 2015. Over the summer, the Exchange Board approved a position for someone to oversee the SHOP Exchange. California indents to pursue the option for the employer to choose the plan tier, while the employee chooses the issuer and plan.

Information Technology (IT): Additional legislation to help guide the state toward streamlined eligibility and enrollment systems for Medi-Cal, Healthy Families, and the Exchange was signed into law in October 2011 (AB 1296).14 The legislation requires the creation of a single statewide application that will be available on paper and electronically for all systems and entities accepting and processing applications and eligibility. It also requires a simplified citizenship and identity verification at application and renewal and increased coordination with other public programs.

In June 2012, the Exchange Board, in collaboration with the Department of Health Care Services and the Managed Risk Medical Insurance Board, procured a subcontractor for the development and operations of a new Eligibility, Enrollment and Retention System (CalHEERS) which will serve as the technology infrastructure for all three agencies.15,16 Stakeholders were given the opportunity to provide comments on specific design elements and the Board solicited two different approaches to Medi-Cal case data management- either building to allow the data to reside at the county level or pushing the data to a central hub. The Exchange also solicited subcontractors to provide project management and technical support services to state staff during the design, development and implementation of the CalHEERS system.

In May 2012, the Board began solicitation for a subcontractor to develop and assess alternative approaches for a state-wide Exchange Service Center and then released a report outlining the options being considered.17,18 The County Service Centers will support eligibility and enrollment for the Exchange and the state plans to fill approximately 850 positions for customer support.19 In October 2012, the state released a Request for Offers to counties that previously expressed interest in providing Service Center functions for the Exchange. By 2015, the Exchange aims to enroll 1.4 million Californians in coverage.

Covered California is also participating in the “Enroll UX 2014” project, which is a public-private partnership creating design standards for exchanges that all states can use.20

Basic Health Program (BHP): California has considered an optional coverage program available through the ACA which allows states to use federal funding to offer subsidized health insurance to adults with incomes between 139 and 200% of the federal poverty level (FPL) who would otherwise be eligible to purchase subsidized coverage through an Exchange. Various analyses evaluating the option for California have been released; however, no final decision has been made.21 Legislation creating a BHP was initially introduced in 2011, but in August 2012 the bill was held in Committee, effectively tabling the legislation (SB 703).22

Essential Health Benefits (EHB): The ACA requires that all non-grandfathered individual and small-group plans sold in a state, including those offered through the Exchange, cover certain defined health benefits. Legislation selecting the Kaiser small group HMO plan as the state’s EHB benchmark plan and the state’s Healthy Families (CHIP) program as the pediatric dental supplemental benefit was signed into law in October 2012 (AB 1453/SB 951).23

Exchange Funding

The legislation creates the California Health Trust Fund within the State Treasury, which will be continuously appropriated and used to manage the finances of the Exchange. The legislation also authorizes a loan of up to $5 million from the California Health Facilities Financing Authority to assist in establishment and operation of the Exchange. The California HealthCare Foundation and the Blue Shield California Foundation also funded activities in preparation for applying for the federal Establishment grant.24

In September 2010, the California Health and Human Services Agency received a federal Exchange Planning grant of $1 million. The state also received a federal Level One Establishment grant of $39.4 million on August 12, 2011 which will be used for overall business and operational planning, research and analysis, and implementation of an information technology system. The state was awarded a second Level One Establishment grant in June 2012 for $196.4 million for continued Exchange development.25,26 In November 2012, the Exchange submitted a Level Two Establishment grant application for $288 million to fund Exchange operations through December 2014.

Next Steps

On January 3, 2013, California received conditional approval from the U.S. Department of Health and Human Services (HHS) for its state-based exchange.27 Final approval is contingent upon the state demonstrating its ability to perform all required Exchange activities on time and complying with future guidance and regulations. 

Log In | follow us Health Plans Dental Health Plans and Package Options Individual Term Life Insurance Discounts and Rewards Understanding Health Coverage Summary of Benefits and Coverage (SBC) Why Should You Choose Blue Shield of California? print share email Something for everyone Call us to get a quote and apply at (888) 568-3560. Learn more about our individual and family plans. Go Explore your options, compare plans, and enroll. Attend a nearby seminar. More Find individual and family or Medicare plans to fit your needs. We offer HMO, PPO and HSA-compatible medical insurance plans with a range of features. Learn about our dental health plan options for individuals and families, including our HMO and PPO plans. Learn more about how primary subscribers can add the security of individual term life insurance in California at an affordable rate. Learn about wellness discounts and rewards available to Blue Shield of California members. Learn the basics about our affordable health, life and dental insurance plans for individuals and families, including HMO and PPO plans. The Summary of Benefits and Coverage (SBC) Forms, part of the Affordable Care Act, is intended to help consumers understand their health plan coverage. Get an introduction to Blue Shield of California, and learn why you should consider Blue Shield medical insurance as your health plan. Learn about the advantages of health savings accounts and our HSA-compatible high-deductible plans. Go Use this tool to find a Blue Shield of California broker in your area. Go Learn about our strengths and advantages as a not-for-profit health plan. Go Contact Us Quick Links Get Social Customer Service (800) 393-6130 Pre-Admission (800) 541-6652 Tech Support (800) 393-6130 Blue Shield of California P.O. Box 272540 Chico, CA 95927-2540 About Blue Shield Contact Us Newsroom Careers Send Feedback Terms of Use Privacy Sitemap © Blue Shield of California 1999-2014. All rights reserved. Blue Shield of California is an independent member of the Blue Shield Association. Health Insurance Products are offered by Blue Shield of California Life & Health Insurance Company. Health Plans are offered by Blue Shield of California.

 Overview
If you live in California and either buy your own health insurance or are currently uninsured, this guide is for you. It will help you:

Determine whether you may qualify for a credit to help you pay for health insurance under the Affordable Care Act (also known as Obamacare)
Compare private health plans using U.S. News & World Report's health insurance ratings for California
From now until November 15, the start of the next open enrollment, you cannot get new yearly insurance unless you have a qualifying life event. See below for those options for coverage and how to avoid the penalty.

Do I Qualify for a Tax Break on Health Insurance?
Use the tool at right to determine whether you qualify to receive a tax credit (called a subsidy) that you can use to pay for health insurance. The calculator will also help steer you toward health insurance options that may be best for your needs.

If You Qualify: Plans That Cost Less
Under the Affordable Care Act, you might qualify for a subsidy to help pay for your health insurance. If you qualify, the subsidy can be used to reduce the cost of your monthly premium or can be taken as an annual tax credit. To take advantage of a subsidy, you must choose a health plan that has been approved by the federal government and the government of California. These plans, known as Exchange Plans, meet a set of standards that aim to eliminate benefit loopholes to make sure that people with pre-existing conditions are not being denied coverage.

Note: you had until March 31 to enroll for coverage for the rest of 2014 (enrolling on March 31 would cover you starting May 1). If you missed this date, with few exceptions, you will pay a penalty.

If you missed the deadline to enroll, read about your options for coverage and how to avoid the penalty.
For more information, read Why Get Health Insurance in the State Marketplaces
If You Don't Qualify: Private Plans
If you don’t qualify for a subsidy, you can still choose among the Health Exchange Plans, or consider one of the many private health insurance plans available in California’s private marketplace. We have rated these private plans on a 1-star to 5-star basis, with 5-star plans providing the most comprehensive coverage.  What’s the biggest difference between a private market health plan and a government-approved one? The trade-off is usually cost. Insurance companies can charge less for private plans with less-extensive network coverage or fewer benefits, which makes more-affordable options available to you.

Compare private plans in the U.S. News Health Insurance Ratings for California
Read more here: Hidden Costs of 'Affordable' Health Insurance
Private Health Insurers in California
Anthem Blue Cross of California
Assurant Health
Blue Shield of California
Chinese Community Health Plan
Cigna
Health Net
Kaiser Permanente
Valley Health Plan
Do I Have To Buy Health Insurance?
You may have heard that everyone in California must have health insurance in 2014 or pay a penalty – Obamacare's so-called “individual mandate.” With a few exceptions, this is true. For 2014, not carrying insurance will cost $95 per adult plus $47.50 per child (up to $285 per family) or 1 percent of your family’s income, whichever is more.

U.S. News generally recommends getting health insurance of some kind, even if it is only catastrophic coverage. That's because unexpected medical expenses can easily bankrupt anyone who is uninsured.

See the pros and cons of getting health insurance: Why Do You Need Health Insurance?
For more on the penalty, read Should I Pay the Penalty?
If your health insurance policy was cancelled in fall 2013, you may be eligible to renew it for 2014 coverage. Call your insurer to verify whether your plan is still available. For more info, read Cancelled Health Plans Leave Consumers Puzzled
Where To Buy Health Insurance
California's Official Marketplace
Covered California is California’s official portal for buying an Obamacare Health Exchange Plan under the Affordable Care Act. To sign up online for coverage on Covered California, be prepared to fill out a form that could take 30 minutes or longer. To complete the process quickly, have this info handy:

Social security numbers for everyone in your household
Your employer’s name and address
Your most-recent pay stub or recent records of your wages
Information about other types of income you receive, such as alimony, unemployment benefits or a pension
 
Insurance Companies and Brokers
Some people prefer to buy health insurance directly from an insurance company or through a broker. Thanks to strict regulation, you'll pay the same price for a plan regardless of where you buy it – whether on the Covered California website, through a broker or directly from an insurer – and regardless of whether you sign-up via phone, online, or by filling out paper forms.

U.S. News & World Report has teamed up with GetInsured, an online broker licensed to sell health insurance, to help you buy the subsidized health plan you want. The GetInsured customer service team can answer questions, determine whether you're eligible for a subsidy and help you apply for insurance.

Qualified Plans on Covered California
Beginning October 1, 2013, each state was required by law to have a new online marketplace where residents can buy health insurance. In these marketplaces, most states offer five tiers of Obamacare Health Exchange Plans: platinum, gold, silver, bronze and catastrophic. Platinum plans will offer the highest level of coverage but tend to cost more in monthly premiums. Bronze plans will cover only a bare minimum of health care expenses but tend to have low premiums. If you are relatively healthy and want to pay less up front, consider a lower-tier plan such as bronze or silver.

You should also look at a Covered California plan if you are lower-income, because the government will give financial help on a sliding scale to pay for premiums, and better benefits if you select a silver-tier plan. If you have not already done so, we can tell you if a Covered California plan makes sense given your income. Use the "Shop for Health Insurance Now" section on the top right of this page.

Read ACA and Health Insurance: Which "Metal" Tier is Right for You? for more advice on choosing between metal tiers.

Need More Help?
If you need help choosing a health insurance plan or filling out your application, California has trained nongovernment groups to guide you through the process. Sometimes called “Navigators,” these groups can answer technical questions on insurance, Medicaid, and tax credits (subsidies on monthly premiums) . Navigators also specialize in assisting non-English speaking populations. For more information, contact the Covered California call center at 800-300-1506. The center is open Monday through Friday from 8:00 a.m. to 8:00 p.m. and on Saturdays from 8:00 a.m. to 6:00 p.m.

The California Department of Managed Healthcare exists to help residents resolve issues with their insurance company, locate a doctor or other provider within their network, appeal a denial of service, and resolve billing problems with insurers and providers. The office can be reached at 888-466-2219 or emailed through an online contact form. Residents can file an insurance complaint online.
 

Frequently Asked Questions About Health Insurance
Why Do You Need Health Insurance?
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What Should Women Look For When Buying Health Insurance?
Are 'Affordable' Health Plans Really Affordable?