The health insurance in California is unique unto itself. The state offers several plans for children and low income adults and people with disabilities.
For Children California Offers:
- AIM Program (Access for infants and mothers). This program offers medical assistance for infants and pregnant mothers.
- The CHIPS program offers medical care for children ages 2-18.
- California Children Services (CCS) this is a state run program that provides health insurance benefits for children with qualifying disabilities.
- The Healthy Families Program provides health and dental benefits for children from low income families.
For Adults California offers:
- CalMedicare which helps senior citizens who need assistance to pay Medicare premiums.
- County Medical Services Program (CMSP) this is a county by county program that helps low income residents in finding health benefits.
- Medi-Cal is a state health benefits program provided to California residents with low incomes and or expensive disabilities.
California also offers a pre-existing condition insurance program. This is a program for California residents that have been declined for insurance within the last 12 months and have been uninsured for the last 6 months. Resident that get this health insurance must pay a premium.
Individual Insurance Plans
Most California residents receive their health care coverage through their job or the job of their spouse or parent. However, there are plenty of insurers that offer individual or family insurance policies.
California Group Insurance Plans
In California business owners can buy group insurance plans for as few as two employees. These types of plans are not inexpensive, but group members cannot be declined for coverage and they cover expenses that individual plans may not cover like maternity coverage. In California a small group medical plan usually cost between $300 to$700 for an individual and $700 to $2,000 for a family.
Types of Insurance in California
In California, there are two types of health insurance plans. Fee For Service Plans and Managed Care Plans.
Fee For Service Plans
In a fee for service plan, you select your medical provider and the insurance company pays for all or part of the cost in accordance with the terms of the policy. Usually the insurer pays a percentage of the cost, and you the insured pay a small percentage of the cost called coinsurance. These plans are usually offered through employer sponsored plans, but can be purchased by individuals who purchase private insurance. The quotes for Fee for Service Plans are more expensive than for managed care plans.
Managed Care Plans
There are three types of Managed Care Plans, HMO’s, PPO’s, and POS’s. Many Americans are enrolled in managed care plans because they are cheaper than Fee For Service Plans.
Health Maintenance Plans
In a Health Maintenance Plan (HMO), you pay a fixed cost for your medical care. You are then assigned a physician that is selected by the HMO. The HMO will then take care of all your medical needs, and you will only have to pay a small deductible. HMO’s require you to use their physician, except in emergencies. HMO cost are relatively low because they use the economy of scale to hold down expenses.
Preferred Provider Organization
Preferred Provider Organizations (PPO’s) are managed care plans that are able to get low cost contractual arrangements because they represent a large group of patients. Many government and union plans are PPO’s. In a PPO, you are not required to see a specific provider, but you will receive a discount if you use a provider in the PPO network. Generally you will be required to pay a small copayment ($20 to $30). Quotes for PPO’s are lower than fee for service plans.
Minimizing Health Insurance Cost
- Since health insurance is expensive holding down your insurance cost, will probably be a priority. Below is a list of tips that might assist you in holding down your health issuance cost.
- Increase the amount of your deductible: A higher deductible will lower your insurance cost.
- Increase the amount of your co-payment: A higher co-payment will lower your insurance cost.
- Eliminate overlapping coverage’s like Cancer insurance.
- Eliminate incidental coverage’s like dental and vision coverage.
- Eliminate coverage for non physical services like psychiatric treatments.
- Make a single payment: If you make a single insurance payment at the beginning of the plan year you will reduce your insurance cost.
It is important to remember that having adequate health insurance should be a key part of your financial planning.