Take Two for October 1, 2013

Obamacare FAQ: Navigating Covered California's health insurance exchange

Health Overhaul California

Rich Pedroncelli/AP

Peter Lee, executive director of Covered California, the state agency running the state's new health exchange, announced the plans and prices that will be offered by private insurers during a news conference in Sacramento, Calif., Thursday, May 23, 2013. Some of the state's largest health insurers will be among those companies offering competing polices to millions of Californians who are expect to purchase coverage under President Barack Obama's Affordable Care Act.

Covering California series icon 2013

In his speech defending the federal health care law, President Obama last week told Americans: “You don’t have to listen to the politicians. You don’t have to listen to me. Just go check it out for yourself.”  

Now you can do that, beginning today. This morning, insurance marketplaces opened around the nation allowing Americans the chance to comparison shop for insurance. Now all Americana can find out what the Affordable Care Act – or Obamacare – really means to them. 

RELATED: FAQ: Is Obamacare a good thing for California's small businesses?

A survey last week by the Kaiser Family Foundation found that three out of four Californians who earn modest incomes and could buy government-subsidized private coverage wrongly believe they’re not eligible for federal assistance or they simply don’t know if they qualify.

The survey found only half of newly eligible low-income Californians are aware that they will qualify for expanded Medi-Cal in California — the government program for the poor. 

In addition, about half of California’s undocumented immigrants wrongly believe they will be eligible for coverage, even though the law specifically forbids them from buying insurance in the state exchanges. The law only permits immigrants who have a green card and have lived in the U.S. for five or more years are eligible to participate in the exchanges or Medi-Cal.

KPCC health reporter Stephanie O’Neill  joins Take Two to help us wade through the confusion. 

FAQ:

Here are the basics: Under the Affordable Care Act nearly every American must have health insurance by January 1, 2014 or pay a fine. The fine starts out around $95 (or 1 percent of income, whichever is larger), then it climbs in 2016 to $695 a year or 2.5 percent of income.

Enrollment starts today and lasts through March 31, 2014. You can’t just wait and buy insurance when you get sick and are on your way to the hospital. Also you have to buy it during the open enrollment period.

Q: Who does the ACA affect?
A: If you already have health insurance from your employer, you don’t have to do anything. If you have Medicare, the law improves your coverage of prescription drugs, but otherwise, the law leaves Medicare pretty much unchanged. If you receive Medi-Cal – federal-state insurance for the poor — you will continue to receive it and nothing changes for you. If you are an uninsured Californian, things will be different.

Q: How will the ACA affect uninsured Californians?
A: There are more than 5 million Californians who will qualify to get insurance on the new state-run marketplace that opened today, Covered California. About half of them are eligible for government subsidies, which are federal tax credits that will offset the cost of their monthly premium. The subsidies are available to those who earn $15,850 to about $46,000 a year. A family of four is eligible if they earn between $32,500 to $94,200 a year. The more you make, the smaller the subsidy. The less you make the more assistance you’ll get, and that’s based on your adjusted gross income plus any tax-exempt income you might have.

Q: How does the government subsidy work?
A: You can decide whether you want it up front to offset the cost of your premium each month, or if you want to take it at the end of the year. But if you underestimate your income, or you earn more money during the year,  you will be required to reimburse the government at tax time.  Likewise if you earn less than you thought, you’ll get a rebate.

Q: What about California's Medi-Cal expansion?
A: Another almost 1.5 million Californians are eligible for expanded Medi-Cal, which will be open to all individuals under 65 with incomes of up to $16,000 for an individual and about $32,500 for a family of four.

Q: What about those not eligible for Medi-Cal or a subsidy? 
A: They’ll pay full price for the plans. Plain and simple. Whether they can get better deals on the exchange or off it, will require some shopping on their part.   

Q: How does the law advantage everyone?
A: Some key provisions of the law is insurers will no longer be able to deny you coverage because of a pre-existing medical condition – be it back pain, an STD, or cancer. You can’t be booted out of your insurance because you get sick. Your child can stay on your policy until their 26th birthday. Each policy must provide certain essential benefits, like hospitalization, prescription drugs and maternity care. They also must provide certain preventive care, such as some cancer screenings,without charging you a co-pay or deductible. Lastly, insurance companies can no longer impose lifetime caps on coverage, which is important for those with costly medical conditions.

Q: What plans does Covered California offer?  
A: The plans will be provided by twelve private insurance companies statewide. They offer basically the same standard benefits in four categories or tiers of coverage. The first is bronze, which offers the cheapest premiums, but only covers 60 percent of medical costs. So if you’re pretty healthy and don’t go to your doctor much, this might be a good bet. Then it steps up to silver plans which pay 70 percent of medical costs. The next tier is Gold, and that pays 80 percent. Then there are Platinum plans, which have the highest premiums and cover 90 percent of medical costs. Those might be a good bet if you have a lot of medical expenses.

Q: Will these policies be more affordable than what's already on the market?
A: Government officials are saying they will be. So the average statewide premium for a so-called "Silver Tiered" plan – which covers 70 percent of your medical costs — is  $373 a month or less depending on whether you’re eligible for subsidies. But the average cost is just that – an average. Your individual cost will be calculated based on three things: how old you are, where you live and how many people are in your family. You can find that out now,  =by going on the Covered California website and using the online calculator.

Q: What should we be aware of?
A: Narrow Networks. Many of the companies will provide less-costly plans by working deals with doctors and hospitals who agree to get paid much lower rates than they now get. That creates more narrow provider networks which may not include your doctor or hospital. The Covered California website allows you to search for your doctor when considering your plan.

Q: How easy is it to navigate the website?
A: Not as easy as buying a book on Amazon or shoes on Zappos as executive director Peter lee had hope it would be, but health insurance is complicated business, so that’s no surprise. What you’ll find is a lot of fill in the blanks. Stuff like household income, number of people, address, your age, etc.  And then you can see if you qualify for subsidies.

Q: Any last-minute advice?
A: Yes. One way you’ll want to compare what the plans really offer will be by reading the disclosures document that was required under the health law to help consumers compare. It’s pretty straightforward. These forms will provide information about the deductibles, what they apply to, coinsurance and copays and they’ll tell other stuff like you what services are not covered. That’s really key when you’re making such an important decision.  


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