Western Health Advantage (WHA), a regional HMO serving the greater Sacramento region, introduced 3 new individual health insurance plans for their service area in northern California. Up until this time, WHA has focused solely on the small and large group market. Their individual plans will reflect their existing network of hospitals and doctors.
An Alternative to Kaiser Permanente
Typically, HMO individual health plans in northern California have had substantially higher premiums when compared to their PPO counter parts offered by insurers like Anthem Blue Cross and Blue Shield of California. Kaiser Permanente of northern California has offered the best individual rates for HMO plans. As with all individual and family plans, folks applying for an individual WHA plan will have to go through underwriting.
Are they competitive?
I did a little price comparison for a 49 year old living in the Sacramento area. Blue Shield of California had no competitively priced HMO plans. Anthem Blue Cross Select HMO was somewhat reasonably priced for a $25 copay/ $3000 max. out-of-pocket amount. Next in line for affordable pricing were the WHA Individual Advantage 40 ($40/$3000) and the Individual Advantage 15-30 ($15/$1500). The Kaiser Permanente 40/3000 and 30/1500 plans had the lowest price points.
Comparing apples and oranges
It is difficult to do a straight across comparison between all the plans because the difference in copays, deductibles, maximum out-of-pocket amounts and prescription drug benefits. When I factor in that the WHA Individual Advantage plans have a substantially lower maximum out-of-pocket amount over the Kaiser plans, WHA looks very competitive.
Both WHA and Kaiser also offer a Health Savings Account (HSA) compatible plan. Kaiser definitely had a price advantage for the 49 year old male. While HSA’s can have lower premiums than a more traditional plans, it is important to understand how the HSA model works before jumping in the pool.
HMO vs. PPO
Of course, there are many people who do not like the HMO (Health Maintenance Organization) model of health care. PPO (Preferred Physician Organization) plans give the member the freedom to select any doctor for any ailment. Additionally, PPO plans are under less burdensome regulations making them less expensive than HMO plans in most markets.
Diversity of doctors and hospitals
Western Health Advantage has a large diversity of doctors and hospitals to choose from. Other than having to select a Primary Care Physician (PCP), for most people, it is hard to tell the difference between them and a PPO that uses a similar network of doctors and hospitals. WHA also has a great reputation in the communities its serves. It will be fun to start quoting their plans and offer families another option for their health insurance needs.