Private Health Insurance in California
Obamacare requires that most Californians enroll in a health insurance plan or face tax penalties. Many Californians buy their plans through Covered California, but the state-run health insurance exchange isn’t the only option. You can purchase health insurance outside the marketplace.
People who qualify for subsidies benefit a lot from buying through the exchange. But if you’re not eligible for lower premiums on a health plan because your income is above 400-percent FPL, selecting health insurance outside the marketplace is logical.
Open Enrollment Outside Covered California
The primary thing you should know about enrolling through the private market is that you must still sign up during the open enrollment period. In 2014, all private insurance carriers in the market adopted the open enrollment period of Obamacare. Outside this period, you’ll only find short-term plans that don’t meet the minimum essential requirements and won’t protect you from tax penalties.
Why Shop Outside of Covered California?
There are many reasons to shop for health insurance outside Covered California:
- You don’t earn enough income to qualify for the government subsidy. The annual income limits to be eligible for the government subsidy for 2017 are $47,520 for an individual and $97,200 for a family of four. The government subsidy is available only through the Covered California marketplace, but even if you don’t earn enough, you may use it to compare plans.
- You want a wider variety of plans. Because not all plans in California are sold through the marketplace, shopping health plans outside the exchange may be necessary to gain access to all the available plans on the market.
- It’s outside open enrollment or you’re looking for short-term insurance. Unless you qualify for special enrollment, you may only purchase marketplace health plans during the open enrollment period. If you wish to buy a short-term plan or travelers insurance, you may need to shop outside Covered California during as well as outside of open enrollment.
- You’re eligible for catastrophic coverage. Although catastrophic health coverage isn’t offered through the Covered California marketplace, there are situations where you can qualify you for catastrophic coverage. In such instances, you’ll need to buy outside the marketplace.
Will I Pay More if I Buy Insurance Outside Covered California?
Without taking the government subsidy into account, you won’t pay more for a health plan regardless of where you shop. In most cases, you’ll be reviewing the same health plans if you buy through Covered California or not.
Prices are highly regulated. The only factors that can affect the cost of your health plan are your age, family size, income and contributions from your employer. Your health history won’t affect the price of the plan.
Should I Shop for Health Insurance Outside Covered California?
If you’re barely or not eligible for the government subsidy, you should weigh all your options. You might still choose a plan in the marketplace, because even the costliest subsidized plans are generally cheaper than an unsubsidized plan. But again, health care costs sometimes go above premiums, and the more healthcare services you need, the more practical it will be to compare all your options.
The good news is you’ll never be restricted to one plan under the Affordable Care Act. You can switch your plan anytime during the open enrollment period. But once open enrollment ends, you’ll be restricted to the plan you’ve chosen until the next open enrollment period. In general, the more government subsidy you qualify for, the practical it becomes to shop outside Covered California or buy a non-marketplace plan.
How to Buy Private Health Insurance Plans in CA
If your income doesn’t qualify you for the government subsidy, you can buy private California health insurance plans in three ways:
- Directly from the insurance company
- With the help of an insurance agent or broker
- From an online health insurance seller
If you have any questions about California private health insurance, you can contact us for assistance at (707) 571-7590. We’ll be happy to help.