What You Pay

Here we are going to look at the types of expenses you have to pay if you get an individual plan for yourself or your family through Covered California. Then, we’ll look at what factors can make those expenses higher or lower.

Expenses

When it comes to individual plans you will need to pay a monthly premium, plus additional fees each time you get a service.

The Monthly Premium

The monthly premium is a set amount of money you have to pay each month to be part of a plan, regardless of whether you use any health care that month.

Example

Stephen is single and makes more than $48,560 per year, meaning he has to pay the full premium for his individual plan (the government won’t help him pay for it via tax subsidies). He’ll have to pay about $200 per month for the plan he’s chosen.

Additional Fees When You Get Care

Each time you get care, you may need to pay additional fees. Which of these fees you have to pay and how much you have to pay depend on your plan; some plans only have copayments, while others have copayments, coinsurance, and deductibles.

Copayments are a set amount you have to pay for a medical visit or service. The exact amount of the copayment varies depending on the service you get: medications, visits to specialists, lab tests, x-rays, emergency room visits, and other services can all have different copayment amounts.

Example

Under Stephen’s plan, he has to pay $40 each time he visits a specialist, $20 for each prescription drug, and $30 for each lab test.

Coinsurance is a set percentage of the cost of a visit or service that you must pay.

Example

Under Stephen’s plan, he has to pay 20% of the cost of any surgery. So, if his surgery costs $5,000, he has to pay $1,000 and his insurance covers the rest.

A deductible is a set amount of money that you pay out of your own pocket each year before the insurance company will begin to pay for certain services, including hospital care, emergency room visits, and brand-name prescription drugs. Once you have paid the deductible, you do not have to pay it again until the next calendar year.

If you are under 30, you can sign up for a catastrophic plan with a high deductible. You will have to pay the deductible before this type of plan will pay for most Essential Health Benefits, though you will be able to see your primary care provider up to 3 times and get preventive care without paying the deductible.

Tip: If you have to pay a deductible before your health plan will pay for your medications, shop around to see where you can get them cheaper. Some stores may have generic medications much cheaper than your usual pharmacy – as low as $5 or less for some medications.

Example

Under Stephen’s plan, there is a $2,000 annual deductible before his plan will pay for hospital care. If he needs to stay in the hospital for several days to recover from his surgery, he will pay the first $2,000 of his stay. After he has paid that amount, he also has to pay 20% of the rest of the cost. If he goes back to the hospital later in the year, he will not have to pay the deductible again.

Maximum Out-of-Pocket Expenses

Each plan has a maximum amount you have to pay each year in fees for medical services (copayments, coinsurance, and deductible). This cap for your out-of-pocket expenses does not include the money you spend on your monthly premiums. The exact amount of your out-of-pocket maximum will depend on your plan and can range from $2,000 up to $7,350 for an individual or $14,700 for a family.

Example

Stephen gets a plan through Covered California that:

  • Has a $200 per month premium
  • Requires $40 copayments for visits to his doctor and $20 copayments for generic medications
  • Requires 20% coinsurance for hospital care and outpatient surgery.
  • Has a $2,000 deductible.
  • Has a $5,000 out-of-pocket maximum.

When Stephen has an automobile accident and goes to the emergency room, he has to pay his full $2,000 deductible, because he hadn’t yet paid it this year. The accident also forces him to have major surgery that costs $15,000. He’s already paid his annual deductible, so now he just has to pay his 20% coinsurance, which means he pays $3,000 for the operation and his insurance plan covers the rest. Between the $2,000 he paid for the emergency visit and the $3,000 he paid for the operation, he has spent his entire out-of-pocket maximum for the year.

Stephen has to stay in the hospital for 3 days as he recovers from his operation, and he also needs to take a number of medications to help the recovery and prevent infection. Usually he would have to pay 20% coinsurance for the hospital stay and a $20 copayment for each medication; but because he already spent his out-of-pocket maximum this year, he doesn’t have to pay anything – his insurance plan will cover it all. In fact, other than his $200 monthly premium, Stephen will not have to pay anything for any of his health care for the rest of the year.

What Affects How Much You Pay

The amount you pay for these expenses if you get an individual plan through Covered California depends on 5 main factors:

  • The level of health plan you choose
  • The type of plan you get
  • Your family’s income
  • Where you live, and
  • Your age.

Note: Health plans used to charge people more based on their gender or whether they had pre-existing conditions. That is no longer allowed. People can only be charged more based on the factors listed here.

Health Plan Levels

There are 4 different levels of plan available to most people:

  1. Platinum plans have the highest monthly premiums and the lowest fees when you get medical care.
  2. Gold plans have slightly lower premiums and slightly higher fees when you get medical care.
  3. Silver plans have lower premiums. The fees for medical services depend on your family’s income; if you make less than 250% of the Federal Poverty Guidelines (FPG), the fees may be as low as a gold or platinum plan.
  4. Bronze plans have the lowest monthly premiums and the highest fees when you get medical care.

You may see these plans listed with percentage ratings (60%, 70%, 73%, 80%, 87%, or 90%). The higher the percentage rating, the lower the fees you have to pay when you get medical care. Note: These percentage ratings do not reflect what percentage of your family's expenses your plan will pay for. They are based on averages for thousands of families and how much your plan actually ends up paying for your family could be much higher or much lower than what the percentage rating says, depending on the services your family needs.

Health Plan Types

There are 3 main types of private health plan available through Covered California:

  • Health Maintenance Organizations (HMOs) have a specific network of health care providers, including doctors, hospitals, labs, and pharmacies. You choose a primary care provider (PCP) from their network. When you have a medical problem that isn’t an emergency, you may need to see your PCP first. If your PCP thinks you need to see a specialist, your PCP will write you a referral to see another doctor in the network. You can only get services outside your network in an emergency.
    • The Bottom Line: HMOs have lower costs and less paperwork than PPOs, but you have fewer choices of health providers.
  • Preferred Provider Organizations (PPOs) also have a network of doctors, but you can usually see any doctor in the network, including specialists, without a referral from a primary care provider (PCP). You can also see a doctor outside of the PPO network, but you will have to pay a higher portion of the bill.
    • The Bottom Line: PPOs offer more physician choice and don’t require much paperwork if you stay in their network. They usually have a deductible and your premium and total out-of-pocket costs may be higher than in an HMO.
  • Exclusive Provider Organizations (EPOs) are similar to HMOs. They have a specific network of health care providers, including doctors, hospitals, labs, and pharmacies, and you are not allowed to get services outside that network unless there is an emergency. However, their network of providers is usually smaller than an HMO’s. Unlike an HMO, you do not need to have a primary care provider (PCP).
    • The Bottom Line: EPOs usually have limited physician choice like an HMO, but do not require a PCP referral in order to get specialist care. EPOs have the lowest premiums.
Plans with Health Savings Accounts (HSAs) Help Families with Higher Income Most

Some health plans on Covered California let you create Health Savings Accounts (HSAs) to set money aside to help you pay for certain approved medical expenses. For example, you could use the money in this account to pay for expenses like doctor’s visits or prescriptions that aren’t paid for by your insurance before you meet your deductible.

You decide how much money to put into the account, up to a certain limit. The big advantage of these is that they let you save the money tax-free. The higher the rate of taxes you pay on your earnings, the more they help you. If you don’t have a high tax rate, they probably aren’t going to help you much. Some of these plans have a trade-off that they have higher deductibles or copayments, so they could actually make health care more expensive for some people.

To learn more about Health Savings Accounts, visit the U.S. Department of the Treasury’s website.

Your Family’s Income

Families that make less money and don’t have employers who provide affordable coverage get government help paying for their health care. The amount depends on your family’s income:

  • If your family makes 400% of the Federal Poverty Level (FPL) or less, the government helps pay for your premium via tax credits. That means you pay less each month.
  • If you make 250% of the FPL or less and get a silver plan, the government also pays to reduce your copayments, coinsurance, deductible, and out-of-pocket maximum. That means you’ll pay less each time you need medical services. If you do not get a silver plan, the government will not help you with these expenses.
Health Coverage Income Limits for Your Family
How the government helps pay for your coverage via tax credits

Depending on your situation, you may qualify to have the government help pay for your individual health plan via tax credits. Here's how it works:

  1. When you sign up at Covered California, you give details about your family's situation. Covered California reviews that information instantly. If your family qualifies for government help to pay for individual coverage, Covered California tells you and lists insurance options for you.
  2. Your insurance options list the full cost of the monthly premium, how much of that premium the government will pay each month, and how much you will pay each month. The way the government helps pay the premium is by giving you a tax credit every month, so you don't have to think about it during the year. All you have to do is make sure you keep paying your part of the premium.
  3. In January or February, the government will send you a form listing how much your total health care tax credits were for the previous year. You will need this form at tax time, because it is possible the government paid more or less than it should have for your health coverage. If so, this will be sorted out when you file your taxes.

Where You Live

Different providers offer different plans in different parts of the state and the prices of these plans vary.

Your Age

The older you are, the higher your monthly premium. However, older people can only be charged a premium that is at most 3 times as high as a young person would be charged.

Things to Think About

When you use Covered California to get health coverage, you can control 2 of the things that affect how much you pay for your coverage: you choose the level of plan you want (platinum, gold, silver, or bronze) and what type of plan you want (HMO, PPO, or EPO).

Here are some questions to think about as you compare plans:

  • Do you qualify for government help paying for your health coverage?
  • How high a premium can you afford to pay each month?
  • How often do you visit the doctor or need other medical services? Try and add up the copayments you would need to pay for those appointments each month. Can you afford those?
  • Do you like your current doctors? Which types of health coverage do they accept? Are you willing to switch doctors to save money?
  • Are you okay with having a primary care physician who refers you to specialists when you need them? Or do you prefer being able to set up appointments with specialists on your own?
  • Are you comfortable with having a deductible for hospital care, outpatient surgery, and emergency room services?

Each family has a different situation, and the right answers for you will depend on your specific needs. For example, if you know you will have to go to the doctor a lot, you may want to make sure that you don’t have high copayments. Or, if you hardly ever go to the doctor, you may prefer to have a lower premium.

Try out CoveredCA's Shop and Compare Tool to see how much you might have to pay each month for a silver level plan.

Example

Sonia, Anthony, and their two little children are getting health coverage through Covered California. Sonia makes $53,000 per year (a little more than 200% of the Federal Poverty Line for a family of four) at her job, but her employer doesn’t offer health coverage for its employees, so her family has to pay for an individual plan. Anthony is a stay-at-home dad.

Sonia is a little nervous since her family doesn’t make a lot of money, but she knows that there is supposed to be an affordable option for every family, so she decides to check out Covered California. Covered California asks her for some basic info, including where they live, how much income the family has, and the age of each family member.

Once she’s answered these questions, Covered California displays a set of options for herself and her family, and she finds that her family qualifies for a government-subsidized silver-level plan, with a premium she can afford, low copayments, and no deductible.

If you can no longer afford your plan

Usually, when you sign up for a plan through Covered California, you need to stay on the plan for the entire calendar year. So, if you are signed up for 2019, then you can’t leave that plan until 2020.

However, there are certain situations when you may be able to change plans mid-year:

  • If your income changes and you gain or lose eligibility for government help paying for your coverage
  • If your health provider is not meeting its obligations
  • If you move
  • In other life-changing circumstances, such as having a child or getting married

The first one is the key. If your income goes down and you can’t afford your plan anymore, you need to report your change in income to Covered California. You may qualify to get Medi-Cal or to have the government increase how much it pays for your current insurance via tax credits (meaning that you have to pay less).

Different Requirements for American Indians

If you are a member of an American Indian tribe recognized by the federal government and you earn less than 300% of the Federal Poverty Level ($36,420 per year for an individual, $75,300 for a family of four), you will not pay any copayments or deductible for the health insurance plan you get through Covered California.

American Indians can also change health plans up to once a month.