ConsumerWatch: California’s Health Care Exchange Explained
SAN FRANCISCO (KPIX 5) — California is getting an early look at how President Barack Obama’s health care reform measure will work. The Golden State was the first in the nation to set up a health insurance exchange.
The exchange is called “Covered California.” All insurance sold will have essential services, including doctor visits, emergency care, prescription drugs, well baby visits, even mental health care and substance abuse treatments.
“What Covered California has done is pretty revolutionary,” Betsy Imholz of Consumers Union told KPIX 5. Imholz has carefully tracked how the Affordable Care Act, also known as Obamacare, is unfolding in the state.
She said unlike many other states, California picked only the plans that met its strict requirements. And that means more competitive rates and standardized benefits.
“The beauty of comparing these standardized plans, which is pretty unique in California, will be that you really know what you’re getting what you’re not getting and be able to make a fair comparison and really get the best value for your dollar,” said Imholz.
Beginning in October, almost anyone who does not get health insurance through work, Medicare or Medi-Cal will have to shop around for a private plan.
The number of insurance plans available to you depends on where you live.
“They vary from a low of three to a maximum of six plans depending on the region,” Imholz explained. The San Francisco Bay Area has seven different regions.
The cost of these plans varies by region, age, family size, and by what is called a “medal tier.”
“They have what’s called precious metal tiers of coverage: so think of the Olympics: bronze medal is a good thing but it might not be as good as silver, gold, or platinum”, said Imholz.
The medal tier determines the percentage that you will choose to pay for your co-payments & deductibles. For instance, consumers who choose the bronze tier will pay 40 percent of the cost of co-pays, but will have the lowest premium.
With the silver tier, you’ll pay 30 percent of costs, 20 percent of costs with the gold tier. Consumers who select the platinum tier pay only 10 percent, but pay more up front.
Insurers have already submitted their proposed rates to the state for approval, and they are much lower than expected. The statewide average for silver plans is $321 per month, and in some cases it could even be free.
“If you qualify in terms of income, you can get a federal subsidy for the premium and on the other costs that will make it low cost,” explained Imholz
In fact, a 21-year-old man with the cheapest Bronze plan would pay $172 a month for coverage with 40 percent co-pay. But if he qualifies for a subsidy, he could end up paying nothing.
People who are 30 or younger are also eligible to purchase catastrophic insurance, but the benefits are quite limited. This option includes high deductibles, but still covers preventive care.
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