Covered California is an internet based health insurance market place where individuals, families, and small businesses can enroll in health insurance.
Is Covered California health insurance?
Covered California is not a health plan or health insurance. Covered California is more like a farmer’s market. The market place is organized by Covered California. Insurance companies then bring their health plans to the market place for people to review. Consumers enter the market place and purchase health insurance directly from the vendors. Covered California is just creating the space for the health plan transactions.
How is Covered California different from just going to the insurance company?
Almost all of the health plans available to you in your region are shown to you on the Covered California website. You can compare similar plans side by side and review rates and check to see if your preferred doctors are in-network.
Do consumers pay Covered California for their health insurance?
Covered California operates 2 markets, one for individuals and families and one for small business. If you buy an individual and family plan, you make your monthly health insurance premiums directly to the insurance company. Consumers can make their first month’s premium through their Covered California account, but the payment goes directly to the health insurance company. Companies who enroll in Covered California Small Business group plans pay their premiums to Covered California. Those premiums are then distributed to the health plans by Covered California for the employees who have enrolled into them.
How was Covered California created?
Covered California grew out of the Affordable Care Act. States had the option to create their own market place or exchange to handle health insurance enrollments. California decided to create their own market place and Covered California is the result. Covered California went live with enrollments in 2013 for health insurance for the 2014 plan year.
Individual and Family Market Place
What does Covered California do?
Under the Affordable Care Act, Covered California has 2 missions to accomplish for individuals and families. The first is to determine if individuals and household members are eligible to purchase health insurance through the exchange AND if they are eligible for any federal subsidy to lower their monthly health insurance premium. The second mission is to distribute the monthly subsidy to the consumer’s selected health insurance plan.
Can I only purchase health insurance through Covered California?
You do not have to purchase a health plan through Covered California. You can go directly to the health insurance company and purchase a health plan. However, the only way to be eligible for the subsidies is to enroll in a health plan through Covered California.
Do I get a better price going directly with the health insurance company?
Under the terms and conditions for participating Covered California health plans, they have to offer the same Bronze, Gold, and Platinum plans off-exchange at the same rates as they are offered through Covered California. Silver 70 plans offered through Covered California have a surcharge on them that make them higher priced than the same plan offered off-exchange direct from health insurance company.
Are the health plans different if you don’t enroll through Covered California?
All California health plans must include a specific list of covered benefits regardless of whether the plan is offered through Covered California or directly from the insurance company. The insurance companies can offer some slightly different plans from the Covered California standard benefit design. The differences are mostly related to the member cost-sharing for deductibles, copayments, and coinsurance.
Do all the health insurance companies participate in Covered California?
Some health plans have opted not to participate in Covered California. For example, Sutter Health Plus HMO plans are not offered through Covered California. The health insurance companies may offer other health plans not available through Covered California. However, the only way to be eligible for the federal subsidies is to purchase a health plan offered through Covered California.
How is Covered California funded?
Covered California does not receive any state taxpayer money. The primary source of revenue for Covered California is a 3.25 percent fee assessed on health plans based on the gross premiums of enrollments in the individual and family market. The health plan fee assessment in the small group market is 5.2 percent. Both assessment percentages are for the 2022-2023 fiscal year.
How are health insurance agents compensated?
Certified Covered California insurance agents are paid by the health plans for individual and family enrollments. Commissions for enrollments into Covered California small business plans are paid by Covered California to the agents.
Does Covered California have any input into health plan designs?
Covered California is intimately involved in the creation of the standard benefit design Bronze, Silver, Gold, and Platinum plans. They work closely with the health insurance companies to make sure the health plans meet specific criteria establish by the federal government and additional requirements mandated by California. Covered California plays a very active role in the health insurance market for individuals, families, and small business plans.
I hear a lot of horror stories about getting health insurance through Covered California.
The application for health insurance through Covered California is complicated. In order to be eligible for the subsidies to reduce the health insurance premiums, individuals and families must meet a variety of conditions regarding tax filing status, citizenship, lawful presence, other insurance offered to them, and household income. An error in any one of the conditions can cause the denial of the subsidies or eligibility for Medi-Cal.
How does Covered California and Medi-Cal work together?
Some individuals and dependents are not eligible for a private health insurance plan through Covered with the subsidies because the household income is too low. For adults and children determined eligible for Medi-Cal, Covered California forwards their information to the local county Medi-Cal office for final eligibility and enrollment into a no cost Medi-Cal.
Can I purchase a health plan through Covered California without the subsidies?
At the beginning of the Covered California application, you can indicate you do not want to be considered for federal subsidies. Selecting the no subsidy option will remove the income section from the application. If the individual meets all of the other conditions for purchasing through Covered California, they can enroll in a health plan without the subsidies.
