With 2021 approaching, it’s time for millions of Americans to sign up for 2022 health insurance. And for Californians who can’t get coverage through Medicare, Medi-Cal, or an employer’s health plan, the good news is that expanded federal subsidies will increase. make next year’s policies more affordable for more people than a year ago.
Monday marks the first day of open enrollment at Covered California, an insurance marketplace created by the Affordable Care Act 2010 for people not covered by a group health plan. You can register online, by phone, or through one of the dozens of offices in Southern California where insurance navigators work. If you would like to work with a navigator, call this office before your visit – the pandemic has forced many of them to limit personal contact.
Remember that California law requires adults to have health insurance, with some exceptions. This is true whether or not you have access to a health plan at work. Lack of insurance coverage can result in a tax penalty ranging from hundreds to thousands of dollars.
The process of buying policies can seem daunting if you haven’t done it before, especially if you don’t have an employer to narrow down your choices and pay some of the cost. Here are some tips for registering through Covered California.
What am I buying?
ACA sought to rid the market of unwanted insurance plans that did not cover some high-cost services, with the result that clients who needed these treatments were overwhelmed by medical bills. This required every plan sold in government markets such as Covered California to be comprehensive, which meant that it covered all 10 types of health care the federal government deemed necessary.
But while the policies cover the same services, they are not all the same. One difference is how much of the total annual medical expenses they will incur. Is not your total costs, required; it is based on the average for the wider population. The higher the percentage paid by the policy, the higher the premiums will be.
The offers are divided into four levels: bronze, which covers 60% of the average amount; Silver that covers 70%; Gold that covers 80%; and platinum, which covers 90%. And within those tiers, there are two Bronze plans — one regular, another “high deductible” plan designed to be used with a medical savings account, and four Silver plans with deductibles and co-payments based on your income level.
To make it easier to compare plans, Covered California has standardized policies so that at every tier (and sub-tier of Silver and Bronze), all plans offer the same benefits, copays, and deductibles. As a result, shoppers can focus on fewer things to make a decision: how much they expect to spend on healthcare next year, which doctors they would like to use, and which prescription drugs they need.
How much will it cost me?
Before choosing between plan tiers, you should find out if you are eligible for subsidized premiums and cash payments.
First, if you have access to a comprehensive health insurance plan from an employer that costs less than 8.25% of your annual income, you cannot get Covered California subsidies. You also cannot get subsidies if you live illegally, although you may still be eligible for Medi-Cal if you meet the income limit and are 25 or younger, 50 or older, or currently or you are recently pregnant.
Everyone else is technically eligible, although the amount of the subsidy is tied to your income. These subsidies increased significantly in mid-2021, after Congress passed a resolution and President Biden signed the American Rescue Plan. The increase remains in place until 2022 and Biden’s $ 1.75 trillion Build Back Better package will maintain the higher subsidies for three years thereafter. (Cost-sharing subsidies that reduce personal spending remain unchanged, however; they are only available to households with an income of two and a half times the poverty line.)
With extended assistance, anyone earning up to 150% of the federal poverty level – in other words, up to $ 19,320 per person – can get coverage for $ 1 a month. For wealthier households, premiums are set in the form of gradually increasing percentages of their income – for example, 2% for those whose income is twice the poverty level, 6% for those who are three times the poverty level, and 8.5% for everyone who is at or above four times the poverty level.
A study by the University of California Berkeley Labor Center found that additional subsidies would enable 135,000 Californians to get insurance in 2022 and reduce the costs faced by an additional 1.5 million enrolled, about 150,000 of whom were previously ineligible for subsidies. because their earnings were higher than the previous cutoff.
Keep in mind that the actual amount of the grant you will receive is based on the cost of the second least expensive Silver plan for your income level. Therefore, if you sign up for another plan, your premiums may be more or less a percentage of your income, depending on whether the plan you choose has lower deductions or higher personal expenses than the benchmark.
Which plan is right for me?
Choosing a plan is like rolling the dice; Whether you save or spend more depends largely on how much care you need in 2022. If you know you will need a lot of expensive care, the Gold or Platinum plan is your best bet. than bronze or silver. If you are healthy and have few medical needs, a plan with low premiums and high cash costs makes more sense.
Another option is to opt for the least expensive Bronze plan, which has a whopping $ 7,000 deductible for individuals and $ 14,000 for families, and create a savings account to pay for lab tests, outpatient services, or hospital services you may need before joining. coverage (plan pays for preventive care and three GP visits).
“It is generally accepted that HSA-compliant plans are only suitable for young, healthy people without children,” said Louise Norris, a licensed health insurance broker and analyst at healthinsurance.org. But if you know you’re going to have high enough medical expenses to get the most out of your own pocket, she says, “total costs may be lower” with a high deductible and health savings account plan.
However, she said, these plans require you to be willing to allow savings in your health savings account. So you have to be honest with yourself about this. According to her, if you are going to constantly withdraw money from the account, “it can always be a stressful situation.”
Once you’ve figured out which plan best manages your expected out-of-pocket spending, there are two factors you should focus on, according to Norris.
First, which doctors are in the plan’s network? Each plan has its own list of doctors, some more than others, although there may be some overlap between the two. And some HMO plans require you to see your assigned PCP to make an appointment with a specialist. Either way, going to an out-of-network doctor will usually cost you more, so if you want to keep the doctors you are seeing now, make sure they are networked with the plan you choose.
The second question, Norris said, is: What is included in the plan’s drug formulary? Each insurer makes its own list of prescription drugs that are fully, partially, and not covered. “If you are on a particular drug,” Norris said, “you really want to know how it is covered by the different plans.”
What if I already have coverage?
Covered California automatically renews current members’ policy unless they choose a new one. But many people who renew their subscriptions may see significantly higher premiums, even though average premiums will grow by just 1.8% in 2022.
There are two factors at play here. Californians who receive unemployment benefits are eligible for additional premium subsidies in 2021 that will not be available next year. And Covered California provided additional dollars for the American Rescue Plan for a year in just eight months; once the money has been allocated for the whole year, the discount will not be that great.
Even if you are happy with your current coverage, be sure to tell Covered California any changes in your income, as this may affect the amount of assistance you are eligible to receive.
When should I decide?
Open registration will last until January 31, 2022. But if you want your new plan to take effect at the beginning of the year, you need to register by December 15th.