Learn What Steps You Need To Take To Minimize The Increases
Covered California just announced health insurance rates are rising in 2017. This is not just a Covered California issue.
If you get your insurance directly from an insurance company you will see your rates rise as well. It has never been more important to understand the steps you need to take to keep your costs down.
We’ll show you what the California health insurance rate increases are going to look like. Then we’ll show you what steps you can take to make sure that your 2017 rates don’t skyrocket.
Quick Overview Of 2017 California Rate Increases
What Are the 2017 Rate Increases In California?
The rate increases will vary depending on the health insurance company and the type of plan you have. In San Francisco rate increases will be between 0.4 and 24.8%, with Kaiser being the only health insurance company below double-digits.
In Los Angeles, you will see a range of -5.1 to 32.3%, and Kaiser, LA Care, and Molina limiting their rate increases to 7.5% maximum. A special note in Los Angeles is that Molina Healthcare will be decreasing all their 2017 rates. The San Diego market will see rate increases of -1.7 to 31.5%, where Kaiser and Molina keep their 2017 rate increases below 7.5%.
Anthem PPO, Blue Shield PPO and Health Net HMO subscribers will experience the greatest increases in price throughout California. Small regional carriers like Valley Health, Sharp Health, Western Health, and Molina Healthcare, along with Kaiser Permanente, tend to have the smallest rate increases in areas where they exist.
These numbers demonstrate how important it is to shop for health insurance in 2017. The Open Enrollment Period for 2017 begins Nov 1, 2016, and runs through Jan 31, 2017. During this period you can take the steps we’ll outline below to keep your health care costs down.
How Will The 2017 Rate Increases Affect Me If I Am Insured Through Covered California?
Each year we help the Ginsberg’s shop for a plan that best fits their needs. Their main concern has always been to keep their doctors. During the first two open enrollment periods the Ginsberg’s did not qualify for subsidies, so we selected the lowest cost option that their Scripps doctors accepted.
In 2016 their financial situation changed and they were able to get premium assistance by applying on Covered California. Their choice was to enroll in a Blue Shield PPO policy as this was the only network on Covered California that their Scripps doctors accept.
Unfortunately, the average rate increase for their current policy is 18.2% in 2017, one of the highest rate increases in San Diego. They now have an important decision to make between three choices.
Keep Their Current Plan And Doctors?
Their first choice is they can keep their doctors and their current Blue Shield policy, but only if they are willing to bite the bullet and pay significantly more for their monthly premiums. If the Ginsberg’s $1,572/mo coverage with Blue Shield gets the average increase of 18.2%, their new 2017 rate will be $1,841. An astounding $286/mo increase.
How Important Is Keeping Your Current Doctor?
Or they can choose a new medical group first. If so, We will search to see what networks the new medical group accepts. Then provide them with quotes showing the costs of the new plans (including any subsidies they qualify for) and our recommendations along with the pros and cons of the options. Finally we’ll help them update their Covered California application to select the new coverage.
As an example doctor switch, let’s say the Ginsberg’s go with the Sharp medical system and a Sharp Health Plan. Sharp is a regional carrier and has one of the largest networks in San Diego County. Sharp is raising their costs by only 4-8%, so it is very likely they can lower their monthly premiums. The 2016 cost of Silver 70 at Sharp is $1,581. With an average 2017 increase of 4.7%, the new Sharp Silver 70 cost might be $1,655/mo. A savings of $185/mo by switching doctors.
[jbox vgradient=”#d8d8d8|#ffffff” shadow=”0″ jbox_css=”border:1px solid #9d9d9d; width:300px; float:left;” title=”Major Medical Groups In San Diego” title_css=”color:#2267ae; border-bottom:3px solid #9d9d9d;”]In San Diego county the three largest medical groups are Scripps, UCSD, and Sharp
[/jbox]Downgrade Their Plan?
Their last option is to keep their doctors, and move down to the Bronze level from their current Silver level. Since both of the Ginsberg’s are over sixty years old, this move might under-insure them and probably won’t be the best choice.
However, it is a move you might want to consider if you are not fully utilizing the benefits that your current plan offers.
If your doctors are available in multiple networks on Covered California, then you have an additional choice. You can look for a plan with a better price point. Comparison shopping the Covered California plans at SPF Insurance is very simple to do. All the options available on the Covered California exchange are standardized plans (see the sidebar below).
As the numbers show, shopping for your health insurance is going to be important in 2017 to avoid the rate increases.
What Can I Do If I Purchase Health Insurance Off The Exchange?
[jbox vgradient=”#d8d8d8|#ffffff” shadow=”0″ jbox_css=”border:1px solid #9d9d9d; width:300px; float:right;” title=”Standardized Health Plans Versus Non-Standardized Health Plans” title_css=”color:#2267ae; border-bottom:3px solid #9d9d9d;”]
On Covered California all health insurance policies are standardized. This means that a Silver 70 from Anthem has the same benefits as the Silver 70 from all other insurance companies.
This makes shopping at SPF Insurance simple.
If you don’t qualify for subsidies and you apply to get health insurance directly from an insurance company, you will also find the standardized designs. However, along with the standards you will see that some insurance companies have designed non-standardized options.
These non-standard plans are unique. Each non-standard design will have different benefits and be offered by only a single insurance company.
These Bronze, Silver, and Gold non-standard options are required to have the same actuarial value as the standardized versions. For example, the Silver 70 plan has a 70% actuarial value (meaning that the insurance company will pay 70% of all your medical expenses), and the non-standard Silver designs must have a 70% actuarial value, plus or minus 2%.
Most of the time these non-standard plans don’t fit what people are looking for. The primary reason is that if the insurance company designed it offer a lower deductible (a benefit improvement), then the insurance company will reduce the benefits somewhere else (like making lab tests and xrays subject to the deductible, instead of a copay) in order to maintain the 70% actuarial value.
[/jbox]Those of you that buy health insurance off exchange, directly from an insurance company, or through the SPF Insurance website have a bit more flexibility. Off the Covered California exchange there are more choices available.
The Rickman family of 4 is fairly typical in San Diego County. Dad seldom goes to see a doctor, but works near UCSD in La Jolla and has always gone there. Mom has a favorite Ob/Gyn (at Arch Health Partners) she has gone to for over 10 years. The two girls are healthy and only do annual checkups at Arch Health Partners. Next fall the oldest daughter will begin college at University of Nevada at Las Vegas (UNLV).
The Rickmans currently have a Blue Shield PPO policy because it was the lowest cost plan that provided both UCSD Medical and Arch Health Partners doctors. This fall the family will have some choices to make.
Rickman Family Off Exchange Choices
- Will they keep Blue Shield or look for a lower cost option?
- Can Dad switch to an Arch Health Partners physician with the rest of the family?
- How to provide health coverage for the daughter at UNLV?
As we saw in the Ginsberg’s example, it would be possible to find lower cost coverage. The non-standard Silver plans that Blue Shield offers are between $41/mo to $81/mo lower cost currently. We’ll weigh the pros and cons of these non-standard designs in an upcoming post.
This would probably be the lowest cost option for the family. However, we will still have to come up with a solution for the college daughter.
Getting a separate plan for the college daughter is probably the route to choose. Anthem Blue Cross and Blue Shield of California both offer the Blue Card nationwide PPO network so she can get coverage in both states.
Ultimately, I think the best option for the Rickman family is going to be a combination of Blue Shield and Sharp Health. Mom, Dad, and the youngest daughter can sign up with Sharp, while the college daughter enrolls with Anthem or Blue Shield (which ever is lower cost).
The next best option is for Mom and youngest daughter to be with Sharp, while Dad and college daughter apply with Anthem or Blue Shield.
The FINAL 2017 rate increases and premiums will not be available in Quote Engines until the middle of October or the beginning of November. Once the rates are available we can begin the analysis to determine what your best choices are.
Key Tips For The 2017 Open Enrollment Period
- PPO and EPO networks get the largest rate increases this fall. While these plans certainly offer greater flexibility to visit any physician in the network, they do tend to cost more.
- HMO networks typically have the lowest current prices. And this fall they will experience lower rate increases, so it’s worth considering a move to an HMO network. [jbox vgradient=”#d8d8d8|#ffffff” shadow=”0″ jbox_css=”border:1px solid #9d9d9d; width:300px; float:right;” title=”We Support Do-It-Yourselfers” title_css=”color:#2267ae; border-bottom:3px solid #9d9d9d;”]
- Health Insurance company networks change every week. Just because your physician is in the network this year, does not mean he or she will be there next month or next year. Ask your doctors if they are considering any network changes before the open enrollment period starts. Then verify which networks your physician accepts.
- To verify the networks your physician is in, we’ve created a California Doctor Search Tool page. This page includes all the provider search links from the health insurance companies, along with instructions about how to use the tools correctly!
- Molina Healthcare is not increasing rates in some regions, so they are worth considering. However, you can only enroll with Molina through Covered California.
- In many regions of California, Kaiser Permanente will probably gain many converts from other insurance companies.
- In regions where small regional insurance companies operate, they will get increased interest in their plans.
- The biggest enrollment losers in 2017 could be the major health insurance carriers in California.
- The biggest financial loser in 2017 will be all of us that have individual or family health insurance in California.
Whether you let a broker at SPF help you through the process, or you do everything yourself, the price you pay for your health insurance will be the same.
We are creating this website to support all our customers, including DIYers. You’ll find unique information on this website that directly helps you decide what is right for you.
If you have questions, call us and we’ll quickly give you the answers you need.
All we ask is that you use the “Apply Now” links inside the quotes you receive from SPF Insurance. That way SPF gets paid by the insurance company you chose, and we can continue to provide the information, tools, and recommendations for you to use.
[/jbox]The more you know the better prepared you will be to navigate the 2017 open enrollment period.
It does not matter whether your coverage is through Covered California or directly with a health insurance company. With the exception of a tiny percentage of California, you will see price increases this fall. Let SPF Insurance and our website help you through the enrollment process so you can minimize 2017’s higher health insurance prices.
Key Take-Aways From The 2017 Covered California Rate Increases
- Keep same policy – and pay the full 2017 rate increase
- Downgrade to lower benefit level – you’ll reduce your rates, but you may have higher costs for medical services
- Shop For New Coverage – I expect this to be the route most people will take
- Pick The Plan First – and then select the physician from that network
- Pick The Doctors First – then use our proven 4 step method to get the best health insurance policy for your situation
This fall one of the major decisions you will be faced with is “Do You Change Your Doctor In Order To Reduce Your Premium Increases In 2017?” The answer to this question will determine what your choices are during the 2017 Open Enrollment period.
If you decide to change your doctors, then the main choice becomes:
OR