Kevin Knauss: Health, History, Travel, Insurance
Posts on the development and implementation of the California health insurance market place, application, account, enrollment, termination.
Anthem Blue Cross is terminating many of their 2016 PPO and Tiered PPO plans across different regions of California. They are being replaced with an EPO version in 2017. Covered California has misleading information placed on the consumer’s accounts that the new EPO is the same as the old PPO plans.
Several clients have contacted me regarding eligibility determination forms they have received from Medi-Cal, even though some or all of the family members have a Covered California plan with the tax credit subsidy. Even if the household information on the forms is wrong, Covered California consumers should supply the necessary information to their county Medi-Cal office or risk losing their private health plans altogether. Medi-Cal has effectively taken over the functions of Covered California if the family had been in Medi-Cal or if they still have children covered by Medi-Cal.
With the loss of the Anthem Blue Cross PPO plans in most of California and the double-digit rate increases on many plans, consumers are starting to look at the HMO plans available to them. There was a time when HMO plans were always more expensive than PPO plans. In the new health insurance landscape of Obamacare, HMO plans are becoming less expensive. But is a HMO plan right for you and your family?
The new Covered California Shop and Compare Tool, launched in late September 2016, is broken. The comparison to tool to allow consumers to estimate their monthly subsidy and compare health plans has been giving erroneous results. The worst part is that Covered California has known about the issue and has failed to alert consumers or agents that the tool is giving bad results.
Consumers logging into their Covered California accounts hoping to renewal their health insurance may find they have lost their subsidy. Instead of the reduced premium amount they are used to paying, Covered California displays that are not receiving the tax credit subsidy and must pay the full premium amount. A common denominator for consumers who have lost their subsidy is that they had been on Medi-Cal in 2016, but later in the year qualified for Covered California and the Advance Premium Tax Credits to lower their monthly health insurance bill. The transfer of critical application information from Medi-Cal to Covered California is missing, triggering a loss of the subsidy.
One of the first filters in selecting an EPO or PPO individual and family plan, either through Covered California or off-exchange, is determining if your current doctor is in-network. For all the enhancements to online doctor directory search tools, they still suck. They are not consumer friendly. Consumers are given either too many conditions to select or the provider search tool offers too little information.
Some individuals and families who purchased their health insurance through a government exchange like Healthcare.gov or Covered California may be subject to the Penalty for Underpayment of Estimated Tax. The underpayment penalty is triggered when the federal income tax due is less than 90% of the previous year’s tax liability. If a tax household received thousands of dollars of the monthly Advance Premium Tax Credit (APTC) subsidy to lower their health insurance premiums, but earned too much taxable income to actually qualify for the Premium Tax Credit, the tax payer has to repay the entire subsidy. This repayment amount could easily trigger the underpayment penalty.
For the second time since the launch of Obamacare and Covered California, Anthem Blue Cross has cut the commissions they will pay agents for assisting consumers with enrollment into individual and family plans. Anthem Blue Cross now has one of the lowest commission structures for agents helping individuals and families apply for health insurance in California. This commission cut, coupled with rules limiting Covered California delegated agents from receiving commissions, has resulted in agents thinking twice before assisting consumers with Anthem Blue Cross health plans.
I would not have believed it had I not witnessed it with my own eyes. When I renewed the Covered California health plan for a client her monthly premium amount she will be responsible for will actually be lower in 2017. Even though the carrier had an overall rate increase and she was another year older, the Advance Premium Tax Credit monthly subsidy calculated by Covered California will be larger in 2017. The net result is she will be paying less than $5 per month for the same Silver health plan in 2017.
Many Californians are facing sticker shock over the new health insurance premiums for their 2017 individual and family plans. Covered California and the insurance companies have pointed the finger at the elimination of the Affordable Care Acts reinsurance provision for the health plans. However, another contributing factor is the lower copayments on specific benefits Covered California has mandated in the new health plans. Consumers will be paying less for some out-of-pocket expenses. As the health plans must make up the difference for consumer’s lower cost-sharing, the rates must inevitably reflect this reality.
