If you buy your personal medical health insurance, it's time to choose your coverage for 2022. If you purchase it through Covered California, the chances are better than ever that you will get a large discount in your monthly premium – or pay no premium whatsoever.
Many middle-class families who previously paid full fare for his or her health plans got financial assistance this year with the American Rescue Plan, a law that significantly expanded federal tax credits that reduce the premiums consumers pay.
But thousands and thousands of Californians who're entitled to the credits aren't yet reaping the advantage. Among them are 575,000 uninsured people, most of whom might get coverage for $0 per month, contributing to 260,000 individuals who buy insurance away from state's Affordable Care Act marketplace and could save hundreds of dollars per month by switching into it, based on estimates from Covered California.
“It's lots of money that individuals don't understand they're leaving up for grabs,” says Peter Lee, Covered California's executive director. “I don't know anyone who can comfortably spread $10,000.”
Enrollment for 2022 coverage through Covered California – and for individual and family health plans purchased away from exchange – ends Jan. 31. Consumers can enroll anytime in the past year if they've undergone a significant life change, for example losing a job, moving, having a baby, marriage or just being affected by a natural disaster.
The additional federal tax credits are slated to expire after 2022, but the current version of President Joe Biden's roughly $2 trillion Build Back Better legislation, pending in Congress, would extend them through 2025.
If you're already inside a Covered California plan you like, it might be tempting to simply renew it without checking other options. Resist that temptation. Insurers change the prices every year, and new companies might have entered the market in your region. So a different health plan might be a better deal than your present one.
But if you want the medical providers in your current network, be sure you may have use of them in any health plan you think about for next year.
The American Rescue Plan not just offers many Californians dramatically cheaper premiums but additionally makes Cadillac coverage readily available for free if their income is low enough.
In general, individuals and families with annual incomes between 138% and 150% from the federal poverty line – $17,775 to $19,320 for an individual and $36,570 to $39,750 for a family of four – could possibly get the lowest level of coverage, referred to as bronze, for no monthly premium in 2022. But they would also don't pay premium if they decided on a particularly generous plan referred to as silver-94. The person form of the program includes a medical deductible of just $75, no deductible for prescription medications and an $800 annual cap how much enrollees pay out-of-pocket before 100% of the medical costs are covered. In the bronze plan, in comparison, the medical deductible for a person is $6,300, by having an out-of-pocket spending limit of $8,200 along with a separate pharmacy deductible of $500.
Covered California and all sorts of insurance agents worth their salt are encouraging individuals bronze plans who meet the zero premium income criteria to make that switch.
“I refer to it as the no-brainer plan,” says Edsel D'souza, a partner in the Citrust Insurance company in Culver City. “When people hear about it, they cannot believe it's that good.”
But not all Covered California enrollees have this type of happy surprise awaiting them. Under a provision within the American Rescue Plan, about 120,000 enrollees got the silver-94 arrange for $1 a month this year if they collected unemployment benefits for even one week in 2022. Many – and perhaps all – of those enrollees will lose that discount in 2022 and therefore are facing sticker shock or bracing for a go back to a lower level of coverage.
“I have people who were in bronze, got the unemployment boost, and we switched them to a silver-94, so now they're playing around getting all kinds of tests and procedures done prior to the end of the year,” says Kevin Knauss, an insurance coverage agent in Granite Bay.
D'souza says he helped a family of four in which one of the parents had received unemployment benefits for part of 2022, enabling them to transfer to a Covered California plan that cost $344 monthly. But they can get no subsidy in 2022, D'souza says, and the monthly premium will nearly quadruple, to $1,269.
According to D'souza's calculations, a 40-year-old single individual who resides in West Los Angeles, has an salary of $40,000, and is paying $1 a month in 2022 for a silver-94 plan after being unemployed for part of the year would begin to see the monthly premium jump to almost $200 in 2022 – for a much less generous silver plan.
Shopping and signing up for coverage with Covered California could be tricky, and it's easy to operate into problems.
Knauss notes, for example, that Covered California looks at your income within the month you apply. If you're applying in December and don't have income this month, you may be pushed into Medi-Cal, the government-run insurance program for people with low incomes, despite the fact that your annual income is above the eligibility threshold. It can be time-consuming and frustrating to revert to Covered California.
Another prevalent problem, Knauss says, affects those who have employer insurance that ends Dec. 31. If this applies for you, remember that you're going to get no subsidy for 2022 if you submit an application this month and appearance “yes” when asked whether you have job-based insurance. You need to check “no” even though that isn't technically true at that time, Knauss says.
To avoid a few of these pitfalls, find an insurance professional in your town who'll walk you through all of the options. Agents won't ask you for a penny.
You can find one around the Covered California website (www.coveredca.com). You may also fill out an application on the site to get a quick phone call from an insurance agent or another exchange-certified enroller. And you can get enrollment help by calling Covered California at 800-300-1506.
A word of caution: Some websites imitate the Covered California site, but their purpose should be to generate business leads for agents.
Jonathan Edewards, D'souza's business partner at Citrust, says certainly one of his clients thought he was completing an application with Covered California after which got 20 calls from insurance agents within an hour. “You need to know that coveredca.com may be the official website of Covered California,” Edewards says, “and anything else is suspect.”
This story was produced by KHN, which publishes California Healthline, an editorially independent service of the California Healthcare Foundation.
Bernard J. Wolfson:
bwolfson@kff.org,
@bjwolfson
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