Individuals – Need to Know

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Risk Management 2016: Low cost, minimal risk, health insurance. With tax benefits.

This strategy isn’t for everyone, but for many of our clients, this will be the best financial solution for their family’s health care. Not sure? Please check independently with your financial adviser, accountant, or whomever else you rely on for sound financial advice. But let’s be up front and identify the type of person this might not work for:

  • Has frequent, ongoing medical/Rx needs, but with moderate annual costs in the $5,000 range if paid out of pocket
  • Expected taxable income for 2016 will qualify for an Enhanced Silver 87 or 94 plan
  • Just can’t handle the added complexity of a non-traditional health plan strategy (hey, this is a legit reason)
  • Expects to be in the individual health market for less than a year

That’s it. Everyone else, keep reading.

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How to make sure your doctor is in-network for 2016

10/30/2015 update: Prescription drug formulary search links added below for all PPO carriers.

The problems patients have had with inaccurate provider data, especially in the last two years, got noticed. Just a few days ago, Governor Jerry Brown signed a bill into law requiring insurers to update their online directories on a weekly basis. Read more details on the new law from the Los Angeles Daily News and the Sacramento Business Journal. The law will not go into effect until July, 2016.

Allpointe provides the information below as a convenience to consumers who are choosing from among health plans. We make every effort to update this with accurate data as we get it, but provider networks do change. We strongly recommend you check directly with your preferred doctors, hospitals, medical groups and other facilities to find out if they intend to participate in-network in 2016.

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Blue Shield vs. Sutter Health impasse: what to do now as a patient?

Yesterday’s news of Blue Shield of CA and Sutter Health ending negotiations on a new contract caught many by surprise. Local news outlets are now reporting that the dispute is not only over Sutter’s high prices, but also whether the inclusion of an arbitration clause constitutes a fair business practices. See stories from the L.A. Times (Terhune), SF Business Times (Rauber), and California Healthline, which notes 280,000 patients may be affected.

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What are the income thresholds for Covered California?

This question comes up a lot, and it should. What you report in your Covered California application as your household’s Modified Adjusted Gross Income has a huge impact on the amount of tax credits you receive.  It also determines whether you or any children under the age of 19 qualify for Medi-Cal rather than a plan from a private insurer.

The household income also dictates whether you may qualify for an Enhanced Silver plan. This is a different type of subsidy – improving (enhancing) the Silver plan benefits: lower deductibles, lower out of pocket maximum amounts, lower copays for services. The Silver 87 and Silver 94 Enhanced plans are some of the best options available to consumers; if qualified, do not think twice about accepting those plans. The Silver 73 is a small improvement over a standard Silver plan – for those who qualify, it is still reasonable to consider an alternative (such as a $1 Bronze plan, which may be available to those who qualify for Enhanced Silver 73).

Covered California provides a chart showing the different income levels and thresholds for Medi-Cal, Enhanced Silver, and tax credits overall.  it is kind of hidden on the Covered CA site, but you can view it here.

(2015 version) Health Insurance Strategy Guide for CA Individuals and Families

Already know what you want?  Great!  Start here to apply directly to a carrier, or follow the instructions here to apply through Covered California.

Everyone else, please consider the following 6 questions:

1. Will you qualify for a tax credit/premium subsidy in 2015?  If yes, your next steps are clear, and the time to act is now.  Sign up for an account at Covered CA (or log in to your existing account), and please be sure to follow these instructions to assign Allpointe as your agent if you have not already done so.  Were you a Covered CA participant in 2014?  Follow these instructions to renew your tax credits and either renew or change your current plan.  Now your choice is narrowed to: which insurance company (Kaiser, Anthem, Blue Shield, Health Net, or one of 6 regional carriers that may be available depending on where you live) and what metallic level (Bronze, Silver, Gold or Platinum). Please see “Do I need to change plans?” below, especially if you have had Health Net’s PPO in 2014.

2. Can you get below the threshold to qualify for a tax credit?  We have talked a number of individuals and families that are on the cusp of qualifying based on projected 2015 Modified Adjusted Gross Income (MAGI). Talk to your accountant or tax adviser about whether you are eligible to make contributions to a Traditional IRA or Health Savings Account (HSA) in 2015, and if that could reduce your MAGI to get under the threshold for a health premium tax credit. In some extreme examples, a family with parents in their 50’s or 60’s, making a contribution of a couple thousand dollars into an IRA could qualify themselves for ten to fifteen thousand dollars in premium tax credits.

NOTE: We have embedded the Kaiser Family Foundation’s tax credit calculator (with their permission) on our site, here.  You can also view what factors into your Modified Adjusted Gross Income (MAGI) here, from UC Berkeley.

3. Is the tax credit worth it?  We recommend clients consider their participation in the Covered California exchange carefully.  If your expected tax credit is small, consider:

  • There is a greater choice of plans outside of the exchange
  • There are larger networks of providers available outside of the exchange
  • Applying directly to a carrier outside of the exchange is a much faster application, cuts out a layer of bureaucracy, and is guaranteed coverage

4. Do you need to change plans?  We recommend everyone review their current plan choice for total cost and the network of providers offered.  However, two large groups of clients should strongly consider changing plans:

  • Those who have a Covered California Health Net PPO – the network of providers will be decimated in 2015
    • Consider a move to Blue Shield, Anthem Blue Cross, or even Kaiser while preserving your tax credits
  • Those who have a 2013 Cigna plan that was grandfathered in for 2014 – Cigna will eliminate all of these plans, use a new network that excludes Sutter Health, and their 2015 rates have leapfrogged the market
    • Consider a move to Assurant (great provider network) or Anthem Blue Cross (also no Sutter Health, but at a much lower price point)

5. Have your providers changed plans?  While most of the big provider network changes for individual plans changed at the beginning of 2014, smaller changes can still occur as providers and carriers will periodically renegotiate terms. The biggest recent example of this was Anthem Blue Cross and Stanford Health ending their relationship back in September — only to resolve their contract dispute a few days ago.  Sutter Health and Palo Alto Medical Foundation are currently negotiating 2015 contracts to remain in-network with Blue Shield and Health Net individual PPO plans, but this has not been completed.

Please check out our guide on how to search the carrier networks, as well as what to ask your doctor or other provider, to ensure that they are in-network for you in 2015.

6. Should you choose a different metallic-level plan?  The vast majority of individuals chose Bronze or Silver plans in 2014, and we expect that to continue. For those with specific health needs and/or predictable, high medical expenses, a Gold or Platinum plan can make sense.  Here are a few strategies to consider when making your choice:

  • Go for the Gold Bronze (but pair it with a low-cost accident rider that will pay your deductible)
  • High-deductible plans compatible with a Health Savings Account (HSA) are still a very good strategy for healthy individuals and families.
    • Learn more about HSA’s here
    • For two-person families, we recommend reducing risk by applying separately
    • The accident rider can be used with an HSA plan as well, offsetting a lot of the financial risk that comes with a high-deductible plan
  • Seek out alternate plan designs that meet your specific needs
    • Assurant Health continues to offer several plans with lower out of pocket maximums than any other plans on the market (some as low as $2,000) – these can be a good fit if you are having a baby, a scheduled surgery, or other predictable, large medical (or prescription) expenses in 2015

Most carriers have released their 2015 plans and rates for quoting, allowing you to quickly run quotes for you and your family that can be sorted by carrier, price, deductible and metallic level. Please consider scheduling a call with us to help determine the best plan choice for you in 2015.

Risk Management Strategy: Go for the Bronze (but add accident coverage)

You are thinking about going with the lowest possible premiums and choosing a Bronze plan, maybe even pairing it with a tax-advantaged Health Savings Account.  The deductible is high — what if you had some unexpected medical expenses and had to pay the first $4,500 or $5,000 before your health insurance started kicking in?  Things happen.  A fall from your bike, a car accident, tearing your ACL while snowboarding … or just walking down your front steps.

In general, for healthy individuals and families, we think the lower premiums offered at the Bronze and Silver level are the right way to go.  And as a way to manage your total financial health risk, pairing your high-deductible plan with a low-cost accident policy can offset that risk when the unexpected happens.

For $20/month, a single individual can have their full $4,500 or $5,000 deductible paid for (less a $250 deductible) in the event of an accidental injury. 

For $43/month a family of four can have their full $9,000 or $10,000 deductible paid for (less $250 deductible) in the event of an accidental injury.

The Accidental Medical Expense policy is our recommendation to pair with a high-deductible plan.

Some clients may be interested in the alternate Accident Fixed Benefit policy, which pays a flat dollar amount for specific services received in the event of an accidental injury.  This plan pays cash benefits without regard to whether your health plan already covers it. In general, this plan is a better fit for clients who choose a Silver-level plan but still want to reduce their total financial risk.  Some examples of cash reimbursement: $100 for a doctor visit, up to $300 per day in the hospital, and up to $1,500 for an air ambulance.

See plan details for both options and get an immediate quote here.

We are pleased to offer these accident riders through Assurant Health.  If you are applying for an Assurant Health medical plan, you can easily add the accident rider on during your application.  But you can select one of these accident riders, even if you have a Kaiser plan, or a Covered California plan, or any other carrier — even if you have coverage through your employer.

How to Search Your 2015 Provider Network (and what to ask your doctor’s office)

Allpointe provides the information below as a convenience to consumers who are choosing from among health plans. We make every effort to update this with accurate data as we get it, but provider networks do change. We strongly recommend you check directly with your providers to find out if they intend to participate in-network in 2015.

Anthem Blue Cross of CAsearch providers here

PPO network: Pathway PPO / Pathway X PPO
EPO network: Pathway – Tiered EPO /Pathway X – Tiered EPO
Notable exclusions: Sutter Health (2015 update: some Sutter hospitals will be included in Anthem’s 2015 Pathway networks, including CPMC, St. Luke’s, Alta Bates Summit, and Novato Community Hospitals – some Sutter doctors may be covered as well – please check with them directly); Palo Alto Medical Foundation; Stanford Health (contract resolved 11/20/14 update: the contract resolution does not apply to Anthem individual Pathway PPO or EPO plans)
Out of state access for non-emergency?: Yes, through national BlueCard PPO/EPO

Ask your doctor: “Are you a participating provider in Anthem’s Pathway PPO or EPO network in 2015?”

Assurant Healthsearch providers here

Network: Aetna Signature Administrators PPO
Notable exclusions: None – Assurant will offer the widest network of health providers to California individuals and families in 2015
Out of state access for non-emergency?: Yes, Assurant provides a strong national network through the ASA and other partner networks

Ask your doctor: “Are you a participating provider in the Aetna Signature Administrators PPO network in 2015?  I am considering an Assurant Health plan and they contract with Aetna to use their PPO network.”

Blue Shield of California – search providers here

PPO network: 2015 PPO for Individuals & Families (including Covered California)
EPO network: 2015 EPO for Individuals & Families (including Covered California)
Notable exclusions: University of California hospital and provider networks; PPO subscribers are typically unable to access EPO providers in neighboring counties and vice-versa.  1/5/2015 update: Blue Shield ends contract negotiations to continue with Sutter Health as an in-network provider.
Out of state access for non-emergency?: Yes, through national BlueCard PPO/EPO network.

Ask your doctor: “Are you a participating provider in Blue Shield of CA’s Individual PPO/EPO for Individuals & Families in 2015?”

Cignasearch providers here

Network: LocalPlus PPO
Notable exclusions: Sutter Health, California Pacific Medical Centers, St. Luke’s Hospital, Palo Alto Medical Foundation
Out of state access for non-emergency?: Yes, subscribers get access to Cigna’s strong Open Access Plus PPO network when traveling to regions without a Local Plus network

Ask your doctor: “Are you a participating provider in Cigna’s LocalPlus PPO network in 2015?”

Health Net – search providers here

Network: 2015 PPO – Individual & Family (not available through Covered CA)
Notable exclusions: Health Net’s direct PPO plans will offer the second-best network to Assurant; AVOID: Health Net’s Covered CA EPO plans
Out of state access for non-emergency?: Yes, subscribers get access to Health Net’s national PPO through First Health

Ask your doctor: “Are you a participating provider in Health Net’s off-exchange individual PPO network in 2015?”

Kaiser Permanente – search providers here

Network: HMO, by region – Northern California / Southern California
Notable exclusions: Members exclusively use Kaiser’s HMO network of providers
Out of state access for non-emergency?: No, only for emergencies.

Ask your doctor: “Are you available for me to choose as my Primary Care Physician?”

Regional Carriers and Other Network Variations

Please note we have provided information here for the six major California insurance carriers, and the networks that they offer primarily in Northern California. Please contact us if you have questions about the regional carrier networks (e.g., Chinese Community Health Plan, Western Health Advantage, Sharp, etc.), or network variations from the major players (e.g., Anthem or Health Net HMO networks in some regions of the state).