What is really happening in the Obamacare California Marketplace?
By Marc Derendinger
Let me start by framing this up in a big picture: The changes to the California health insurance industry can be characterized as a restructuring of the existing market, not a destruction. Under the new structure (Obamacare) California private insurers continue to operate and will offer services through the following channels:
- Existing distribution network
- Private healthcare exchanges
- Public healthcare exchanges (individual & small business)
It’s news to many, but there is truly no “government Obamacare plan” in California. In some respects, this is a private market solution to public needs: For example, private health plan insurers who participate in the public exchanges are serving three markets needs:
- Applicants who earn over 400% of the Federal Poverty Level (FPL)
- Applicants who earn between 139%- 400% of FPL
- Medi-Cal (up to 138% of FPL)
In the new Obamacare California health plan structure, the healthcare exchange serves the function of “a starting point” for all 3 markets, and can be useful later in moving families off Medi-Cal and transitioning them back to the “premium-paying” world. It does not replace the private market, rather it complements it. Under the current system, it is a costly leap for Medi-Cal recipients to enter the private pay insurance world. Time will tell if the new structure helps reduce costs or is negated by the cost of new subsidies.
Do you qualify for lower rates with a Premium Assistance Subsidy? Find out here.
There are additional details covered by the Obamacare Rate Guide and California Buyer Guide, but you should also seek out your local Certified Insurance Agent. There is no additional cost and the benefit to you is access to professional guidance, as you use your new plan or in the event you wish to change plans later. Compare the new health plans here: CoveredCA-ComparisonChart and Paper Application.
Editor’s Note: Marc Derendinger has 30-years experience in the California health insurance marketplace and serves on the agent advisory group for the State of California Department of Healthcare Services California Partnership for Long-term Care. His insurance brokerage is located in San Jose and advises many well-known organizations e.g. San Jose Police Officers’ Association, City of Campbell, City of Santa Clara, plus individuals and family businesses throughout Northern California.California License No. 0563986