By Daniel Weintraub
California Health Report
Today was a big day for Covered California, the new state-run marketplace for health insurance created under the federal Affordable Care Act. The health exchange rolled out the 13 regional and statewide plans that will be available to more than 5 million Californians eligible to buy coverage through the new system beginning Oct. 1.
The choices include two statewide plans — Blue Shield of California and Anthem Blue Cross — plus Kaiser Permanente, which will be available everywhere except the central coast counties of Santa Cruz, Monterey and San Benito. Ten other regional plans will also offer services, with anywhere from two to six plans available in every part of the state. In an interesting twist, several local plans that until now have served only Medi-Cal patients will now offer their coverage to the general public.
The rates will differ depending on a person’s age, where they live, the level of coverage they choose and whether they are eligible for subsidies. But Covered California officials said the premiums will range from 2 percent more to 29 percent less than comparable plans available today to small employers.
Compared to today’s market, younger, healthier people will generally pay more (before considering the federal subsidies offered) while older and sicker people will pay relatively less. But it is difficult to compare the Exchange’s plans to the current system because the new plans will be more comprehensive and available to everyone.
All plans participating in the exchange must offer 10 “essential benefits” required by the federal health reform law and must accept anyone who applies, regardless of pre-existing health conditions.
Consumers, for the first time, will be able to make apples-to-apples comparisons among the plans because their benefits will be standardized. Their prices will vary based on their networks of doctors and hospitals, their strategies for dealing with prevention and chronic illness, and their administrative costs and profit.
Each health plan will offer four different coverage categories, ranked from platinum to gold, silver and bronze. The platinum plans will be the most expensive and will cover, on average, 90 percent of a consumer’s health costs, while providing the lowest deductibles and co-payments. The bronze plans will be the cheapest on a monthly basis but will come with higher deductibles and co-payments.
As an example of all of this will work, a 40-year-old single person living in the North Bay region including Marin, Napa, Sonoma or Solano counties will have a choice from among five health plans: Blue Shield, Anthem, Kaiser, Western Health Advantage and Health Net.
For a person earning more than 400 percent of the poverty level, or about $46,000 a year, the premiums for a “silver plan” would range from $338 a month to $396 a month. If that same person had an income of about $28,000 a year they would qualify for federal subsidies that would bring the cost of premiums for a silver plan down to between $188 and $247 per month, depending on which company they chose.
Co-pays for those plans would be $45 for a primary care doctor visit, $65 for a specialist and $250 for an emergency room visit, with an annual cap of $6,350 on what the consumer would have to pay.
That’s still a lot of money for someone earning under $30,000 a year. But Covered California officials point out that coverage will be offered to everyone whether they are healthy or sick, and the annual caps on consumer responsibility will protect people who do get sick from suffering financial devastation.
The health exchange hopes to have the final contracts with the 13 plans signed by June, and also expects to announce plan and rates for small business employers next month.
For the exchange’s detailed booklet showing which plans are going to be offered in each region, and the rates for each, download this document.