Subsidy through the Exchange

California Bans Short-Term Insurance

This is a very sore subject with us!  California legislatures BANNED ‘short term’ health plans.  Not regulated them, BANNED them!  Did I wake up in Russia or what?  They are now putting many people in an ridiculously awful situation.  Pay double their mortgage for health insurance premiums or go without ANY kind of health insurance!  How is that serving ‘all the people’?  Short of discussing universal health care (which could take a very long time and we can do another blog about that), we have people that will have serious issues and this needs to be fixed ASAP!  WE NEED HELP! 

We understand what they are trying to do.  If they FORCE everyone into traditional insurance, then the premiums would decrease for everyone.  Sounds good in concept but #1 problem, most healthy young people are choosing NOT to buy traditional insurance and there is pretty much NOTHING we can do about it at this point so everyone’s premiums skyrocketed. #2 problem?  The insurance companies MUST cover pre-existing conditions with no limit.  So if younger, healthy people aren’t getting in and all you have is most sick people, what happens to the premiums?  You don’t have to be a rocket scientist to figure this out.  


Our CA legislatures did not think about certain segments of our population that are being severely punished by their action.  The 1st problematic scenario is this, premiums have doubled or tripled for people that have income over the limits set by the government for a subsidy (financial help from the government with their premiums and/or benefits), the middle class and they cannot afford the premiums any longer.  Many times it’s DOUBLE their mortgage especially in the Los Angeles, San Diego or the San Francisco area.  They would normally be paying through the nose for health insurance premiums ($4,500/mo for a family of four or $1,500/mo for a single person in a Silver PPO plan).  Last year, many decided to go commando and not have any insurance at all.  Enter ‘short term’ plans (some call them skinny plans).  They do not follow ACA guidelines (affectionately known as ObamaCare) and their premiums more affordable than the plans that do follow ACA guidelines.  At least they were covered for some things instead of nothing at all, right?  And yes, just like traditional insurance, some short term plans are better than others.  

The 2nd problematic scenario?  We have a large population of people that are US citizens that live abroad.  They do come back to the US for visits however because they spend 99% of the time in another country, they do not have traditional ACA compliant insurance while living abroad.  We used to be able to pick up a ‘short term’ plan for the couple weeks while they were in CA.  Now, thanks to this legislation, there is NO OPTION FOR THEM EITHER!  So if something medically happens to either of these groups of people, they will have to spend down ALL their assets and possibly declare bankruptcy.  These are good, hard working, middle class people that are being put in an AWFUL position.

We hear ‘experts’ saying that ALL ‘short term’ plans are horrible.  That’s not the case!  Because we pride ourselves on leaving no stone unturned to put our clients in a better health and wealth position, we sourced out some very good short-term plans for clients that would have gone UNINSURED because the premiums were so high for them. 

Here’s the other issue.  Losing a ‘short term’ plan didn’t qualify as a ‘Special Circumstance’ to obtain a regular ACA compliant plan, even if they wanted to go back to one.  So they were left, literally hanging!  So there was a glimmer of good news today (albeit, very small glimmer).  This just released from Covered CA, they will allow a Special Enrollment Period (SEP) for consumers who will be affected by this ban.   They will have 60 days following the last day of their short-term coverage to enroll in a Covered CA health plan.  The last lawful ‘short term’ plan in California will expire on March 31, 2019, therefore the last possible day to enroll in a Covered CA health plan for consumers affected by this ban will be May 30, 2019.

We do have a few solutions remaining so call us if you’re in this predicament too.  And while you’re at it, call your CA State legislator!

Hoffman Insurance Resources is an independent insurance brokerage agency specializing in Medicare and individual/family health plans.  We are contracted with over 40 companies, Covered CA certified and Medicare certified with 13 carriers.  Physically located in the Los Angeles area, we are also contracted in many states throughout the country.  We pride ourselves on doing what’s right for our clients (whether we make money or not), educating you, being your advocate after the sale and exceeding your expectations. We accept only the insurance company commissions so there are NO extra charges for our assistance and guidance.  From ObamaCare through MediCare…we truly Care!  Check out our reviews on Yelp and Google 🙂      323.455.4961



Highlights of the Senate Healthcare Bill

The Senate health bill resembles the House health bill with a couple of changes. I’m sure there will be tons more changes before this passes. Here are some of the highlights:
-Eliminates ObamaCare’s mandate that every American carry insurance.
-The Senate also backs away from some last minute House concessions that would have allowed states to opt out of several protections for those with pre-existing conditions, but insurers would not be allowed to charge higher premiums to those with pre-existing conditions.
-Subsidies will continue for 2 years although they are coming up with a new formula to determine who gets a subsidy and who much. Fewer middle class folks would get help because only those earning up to 350% of the poverty level would qualify, rather than the 400% threshold contained in Obamacare.
-Eliminates the ‘Enhanced’ plan benefits.
-Loosens requirements in Obamacare that health plans all cover a basic set of benefits like no limits on coverage.
-Phases out Medicaid’s expansion program and caps Medicaid (MediCal in CA) spending. It basically puts the entire Medicaid program on a budget, ending the open-ended entitlement that now exists.
-Repeals, retroactively to the beginning of 2016, the “employer mandate,” which requires large employers to offer health insurance to workers or be fined.
-Repeals the 3.8 percent tax on net investment income, to the start of 2017.
-Strips Medicaid funds from Planned Parenthood clinics for one year.
-Health plans that offer abortion services would not be eligible for the subsidies.
The bill is likely to come to the Senate floor next week. They’d like to get it done before the 4th of July recess.
The Senate has 52 seats and the bill would have to pass by 50 with Vice President Mike Pence breaking the tie.  They may have already lost one vote — Senator Rand Paul, Republican of Kentucky, has indicated that the bill is too liberal for him.

On Covered CA and getting a subsidy on your health insurance? BE AWARE!

Opening your mail as you normally do and to your surprise, there’s a letter from Covered CA saying ‘Congratulations, you’re eligible for MediCal’!  Well, in all fairness, they don’t actually say ‘Congratulations’ but you get the gist.  This is what is transpiring right now as thousands of Californians that receive a subsidy, are getting pushed into MediCal because their income on their Covered CA account is $1 too low.  Yes, you read that correctly.  If you are $1 off, you too could lose your doctor!

Why?  The government released the 2017 Federal Poverty Limit Chart that gives guidance to which plans you are eligible for based on your MAGI (modified adjusted gross income) that you reported in Covered CA.  Why they don’t release this at year end, we’ll never know.  That would make too much sense!  For most people, your MAGI is Line 37 on your personal tax return.  If you receive social security and/or tax exempt interest, that’s added to your AGI to come up with your MAGI also.  If that figure is off by $1, instead of that amazing Silver 94 plan you’re enjoying, you could get that wonderful letter saying ‘Welcome to MediCal’.  Or if your MAGI is $1 to high, you could be pushed from the wonderful Silver 87 plan to the not so great Silver 73 plan (HUGE difference in benefits!).  It is vitally important that you check your Covered CA account, look at what income is reported to see if you are in danger and if so, get it changed asap!  I would even go so far as building a buffer for when it’s increased next year.

This mostly affects self employed people because you’re able to write off expenses from your income.  And the income in your Covered CA account is a guess-ti-mate anyway because how on earth are we supposed to predict the future?  I’m sure your tax person could find an extra dollar or two.  And if they can’t, we’ll get you to someone that can!  Are you making too much money?   Did you know that you could put money into an IRA or 401(k) and that would lower your MAGI?  And if you’re self employed, always make sure your tax pro is deducting your health insurance.

Here’s an idea!  Would you rather have someone deal with this for you and not have to pay them any extra?  It’s your lucky day!  While Covered CA really doesn’t advertise it very well on their website (not sure why), you can have an advocate on your side to take care of things like this and it doesn’t cost you ANYTHING extra!  You’re read that right, you won’t pay one extra dime to have us keep up with things like this AND MUCH MORE!   We accept just what the insurance companies pay us.  If you already have an agent and they aren’t pro-active like we are, while they may be really nice, it’s time to change agents!  Once we find out that Covered CA is utilizing the new chart, we review each account to see if they are in danger.  If Covered CA has to be called or your case needs to be appealed, we do that for you. We’re that breathe of fresh you’ve been looking for 🙂

Call or email us and we’ll walk you through how to easily add us as your advocate on your Covered CA account or your ‘off exchange’ health insurance plans.

Debbie Hoffman, Insurance Designs