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Covered CA Q&A

We get questions daily on Covered CA and try to answer them as quickly as possible. Here are some questions and answers recently posted by Health Care Shopper you may find interesting:

Covered California Q&A

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• Why Are Rates Higher in Northern CA?
• Why are Networks Restricted?
• Who Sets Prices?
• Continuation of Non-ACA Policies
Why Are Rates Higher in Northern CA?
Posted: 19 Nov 2013 04:50 PM PST
**Question**: Rates are considerably higher in the northern part of the state than in SoCal. What’s up with that? I understand San Francisco being higher because everything is costlier there, but even the rural areas of the north counties are pricier than LA and Orange County. Can you make sense of it? **Answer**: In a nutshell, it’s about population and competition. More population means more hospitals, large medical groups and other providers. That means more competition with more providers willing to contract at lower rates to get a leg up. That translates to a 48% difference in premium rates between San Francisco and Los Angeles for a 40 year old buying the 2nd lowest priced Silver Plan – $373 vs $252.
Why are Networks Restricted?
Posted: 19 Nov 2013 03:07 PM PST
**Question**: There has been much talk about restricted provider networks in the Covered California plans. If the plans have to be the same as those offered outside the marketplace, how are they restricted? Or all all individual plans restricted in comparison to group plans? Can you shed some light on this subject? **Answer**: Individual plan provider networks have been “narrowed” for 2014 as a way of controlling costs. That’s because a smaller number of medical providers are willing to agree to lower contract rates. Carriers who offer qualified health plans in the exchange must “mirror” those plans (including networks) outside of the exchange, so the individual plan networks are identical in the exchange and off the exchange. Group plans will generally have broader networks than individual plans, if not the same as pre-2014.
Who Sets Prices?
Posted: 19 Nov 2013 02:06 PM PST
**Question**: Does the ACA set prices for procedures etc or are insurance companies allowed to charge anything? Also, which insurance company has the best record for not overcharging for procedures? **Answer**: The ACA does not set prices for medical services, nor for that matter does the law set health insurance rates. Insurance companies negotiate with health care providers – doctors, hospitals, etc.- to set a contract rate for each medical procedure or service. There is considerable variance in medical costs between insurance companies for the same service or procedure and also between providers within the same insurance company network, because negotiated contract rates are lower with some providers than others. There is no transparency for the consumer in this system so there is no way to compare the contract rates among carriers.
Continuation of Non-ACA Policies
Posted: 19 Nov 2013 02:37 PM PST
**Question**: I got a letter from Blue Shield that my existing policy would be terminated Dec 31st 2013, and I would be switched over to some new bronze ACA plan for the next year. A few weeks ago I received another letter and that states my current policy can continue until March 31, 2014. What is the significance of March 31st deadline? Has this something to do with the administrative directive Obama administration issued regarding individual mandate? The above letter was before the more recent development of the administration allowing non-ACA policies to continue till the end of the year. In light of that, should I expect yet another letter from BlueShield extending the current policy until Dec 31, 2014? **Answer**: It is possible that Blue Shield will extend current non-grandfathered plans for another year. If so that would be a result of the recent mea culpa announcement by President Obama. The initial Blue Shield extension was ordered by the Department of Insurance because Blue Shield allegedly did not give policyholders sufficient notice of cancellation.

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Obamacare (aka Affordable Care Act) Opens Today

Starting today the state exchanges opened to enroll in health care for January 1st. We know it has been all over the news the past few weeks but we are still getting a lot of questions on what it all means and how to enroll. Do you have to enroll? Do you have to go to the exchange? How much is this going to cost? Where is the “free” healthcare you heard about? There is so much to cover and the answers are specific to each individual. If you need help please let us know. We can answer your questions and help you enroll if you would like. We also have options to get health insurance off of the exchange. Don’t let it overwhelm you; call us today at 661-327-5531 or email Jenni at jennI@crosbyandcrosby.com. We are here to help!