Here in the Southland, nestled in the midst of the collided conurbations of Los Angeles and San Diego, we have avoided the cold snaps that have swept across most of the nation and avoided the worst of the government disaster known as ObamaCare.
California is one of thirteen states (plus D.C.) that is running its own exchange and while it hasn’t produced the headlines of its federal counterpart (no one can do it as badly as the Feds.) Covered California has certainly produced its share of bureaucratic snafu and Federal parallels which would be amusing if real people weren’t losing their doctor and their plan.
If you actually wanted to cover the uninsured as the President claimed, what was being done in metropolitan California up until the end of 2013 was about as good as you could get without harming the free market. Programs like Orange County MSI provided essential coverage to those making less than 200% of the federal poverty level ($31K for 2 people plus $8K per additional person); with some modest co-pays ($4 - $25).
MSI got people out of the emergency rooms to a big extent saving the whole system a lot of money that ultimately the insured pick up. The co-pay system, when they had it, provided an accountability to prevent abuse of the system. Doctors contributed by accepting less than 100% re-imbursement like they do with Medicare.
The week of Thanksgiving the letters went out that MSI was being cancelled at the end of the year and that recipients should enroll in Covered California. All of a sudden Charles and Lorraine (not their real names) were scrambling. Both in their fifties she has a heart condition and diabetes, and the ability to renew monthly medications was under threat.
After calling the hotline they found someone to help. Charles had tried to fill out the form online but had gotten stuck being asked the expiration of an ID that didn’t have one. As a result of his attempt the agent (who revealed she is paid $400-$500 per completion) had to start a new app. under Lorraine’s name.
There were over seventy plans available ranging from $2/month to over $600 (for couples making less than $30K). The agent was able to guide them somewhat. They wanted to keep their doctor and pharmacist. The latter they would be able to do but their doctor was not listed. Even his office didn’t know what plans they would be in.
The problem with the really cheap plans is they don’t cover anything and I mean almost nothing. They are basically catastrophic plans so if any person goes over $6K a year in costs then Covered California picks up the rest. You also avoid the IRS fine (I mean tax). They explained to the agent that if they had $6K in medical expenses on their income, that in itself would be catastrophic but she couldn’t help.
Eventually they did find a cheap plan for about $50/year with co-pays roughly triple what MSI charged but some alarming gaps in certain coverages. They enrolled and the agent told them to contact her when they received a welcome packet from the insurer because the plans are not active until the insurer receives a payment.
On the 4th of January they received medical cards in the mail and on the same day a notification from the agent that the first month’s billing be paid by the 6th. But they hadn’t received a bill! (or the welcome packet). Charles notified the agent by email of the status and called the insurer. After a few minutes on hold of a 44 minute advertised wait time he was hung-up on.
Next he went online! He discovered that Lorraine was not listed as a new member but he was. The bill pay was not available but payment deadlines had been extended to the 15th. After his first online message resulted in the browser freezing he was able to message the insurer from inside the payment section explaining his situation (maximum 1000 characters).
Across the Orange Curtain in L.A. County (so named because of the abrupt change in voting patterns as you cross the zig-zag shaped county line) Ricky and Carolyn (also not their real names) had been experiencing similar problems. Their agent, a woman also very active in FreedomWorks, has done a marvelous job explaining the complexities to many Californians. Prior to that they had not known what they would do since Carolyn lost her job last year and the health insurance for a family of four with it.
Many people who go through the process online on their own are heading for a whole separate sticker shock a year from now. I had asked the agents about income verification and they revealed to me that each plan will be tied to the 2014 Federal Tax Return. So if you’ve made up the numbers you’ll be found out at tax time and will then have to pay back whatever subsidies you didn’t qualify for.
Also if you play around with the Covered California website qualifying for enough time you can qualify yourself for Medicaid, as people around the country have been doing with the ObamaCare website. Again though when you file taxes next year your return will immediately be compared to your application, and those people in government sponsored plans will be assessed and billed if they have made more money than they initially declared.
If Republicans win Congressional elections in 2014 (possible) and are smart (less likely) when this wave of new billing hits it will be the wave of anger sufficient to overturn the ObamaCare monstrosity altogether. Voters will demand change! Will Republicans put a knife to the throats of Democrats or just pat them like a dog and invite them to golf to talk about a bi-partisan compromise?
