Skip to main content

The Cost of Mandatory Maternity Benefits in California

Under CA SB 222, all individual & family health insurance plans in California were required to provide, or add and provide, mandatory maternity coverage to all plan members. 

Prior to July 1, 2012 when the mandate went into effect, plans offering maternity coverage were priced higher in terms of monthly premium to reflect actuarial maternity benefit utilization.  

Because the PPACA allows HHS (federal) to review and approve or reject insurance company rate increases on health plans that are 10% or more, and because the California Insurance Commissioner can make enough bad press for a carrier (he currently does not have rate authority in California--that is pending under AB 52), insurance carriers had to add the benefit and try to make the plans actuarially sound. 

Looking at California's two largest PPO insurers for individual & family plans (HMO plans were and are always required to provide maternity benefits) the effect is a bit stunning.

Blue Shield Life & Health (Blue Shield of California)
On April 17, 2012 I blogged the impending closure and replacement of almost every Blue Shield Life & Health PPO plan.  

The new plans released for July 2012 by Blue Shield Life & Health included the mandated maternity benefits and the competitive premiums for the 'new' PPO plans were initially anywhere from 20-30% above the cost of Blue Cross' similar comparative PPO product.  Initially the Blue Shield plans were a bit difficult to sell against Blue Cross lower premium plans.

As of this writing, Blue Shield Life & Health PPO plans appear stable in the mandated CA market.

Anthem Blue Cross Life & Health (Blue Cross of California)
Unlike Blue Shield, Anthem Blue Cross chose to continue their existing PPO plans into the new mandate and pricing was continued on many plans below the Blue Shield premium levels for comparative coverage.  Rate changes were kept low most likely to avoid HHS rate change scrutiny and bad press.  

The result of not replacing the plans with new plans a higher premium levels (see Blue Shield) has seen the following since March, 2012.

Clear Protection Plus 5000 Closed
CoreGuard Plus 10000 Closed
CoreGuard Plus 7500 Closed
Lumenos HSA 5000 w/Maternity Closed
Clear Protection Plus 1000 Closed

Effective November 1, 2012

SmartSense Plus 1000 standard Rx Closed
SmartSense Plus 1000 upgrade Rx Closed
Lumenos HSA 3000 Single  Closed
Lumenos HSA 4500 Single Closed
Lumenos HSA 3500 Family Closed
Lumenos HSA 1500 Closed

11 PPO plan closures in the last six months.  Members on those PPO plans (except the Lumenos 5000 w/Maternity) are allowed to remain on the plan and in some cases may add new family members.  However, all of these plans are closed for new enrollments except family members as mentioned.

As we move towards full implementation of Healthcare Reform, it will be interesting to see what the insurance carries do both in terms of QHP (Qualified Health Plan) implementation and existing plan pricing.

Dave
www.davefluker.com



Comments

Post a Comment

Popular posts from this blog

Anthem Blue Cross (CA) Adding SilverSneakers® Fitness Program

Anthem Blue Cross (CA) announced this morning that they will be adding the SilverSneakers Fitness Program to California Medicare Supplement Plans A, F, and N.  The added benefit will begin on January 1st, 2017. 

Once approved for release into the market, more states have been added to the list as existing and new members in our marketed plans will enjoy the value-added benefits of the SilverSneakers Fitness program at no additional cost! Effective January 1, 2017, California members in our marketed plans will enjoy SilverSneakers, too.  The program offers members their choice of paths to better health. For those who enjoy a traditional workout setting, SilverSneakers offers access to more than 13,000 fitness locations across the country, including use of classes and guidance from a Program AdvisorTM. In addition, for those who can’t get to a fitness center, SilverSneakers Steps® kits focus on at-home or on-the-go general fitness, walking, strength training or yoga. And if that is not …

Anthem Blue Cross Announces Innovative F Medicare Supplement Plan for CA

Anthem Blue Cross (CA) has announced that they are releasing a new Medicare Supplement (Medigap) Plan for California residents.  The plan will be available beginning January 1st, 2018.

'Innovative F' will offer benefits not covered by a Medicare Supplement base plan.  These will include a hearing benefit (exam, fitting and allowance) and a vision benefit (exam, lens co-pay and allowances for frames and contact lenses).

Anthem states that the Innovative F will have a very competitive premium rate.  Innovative F will include the Silver Sneakers fitness program and will be eligible for the Plan F 'new to Medicare' $20 per month first year discount.  

http://www.davefluker.com/innovative-f-supplement.html



Dave
www.davefluker.com





What Multi State Plan (MSP) Really Means (Covered CA)

Lots of confusion on this term and many people think it involves coverage across state lines.  It does not.

This explanation from Anthem Blue Cross is the best one I have seen:



The U.S. Office of Personnel Management (OPM) Multi-State Plan Program (MSPP) was recently established under the Affordable Care Act. It directs the OPM to contract with health insurance carriers to offer at least two plans (one at the silver level and one at the gold level) in each local exchange. The MSPP is intended to promote competition in the Marketplace and help ensure consumers have more high-quality, affordable health insurance options. All MSPP plans will include “a Multi-State Plan” at the end of their name when listed on the exchange - this designates it as an OPM-sponsored plans.  It does NOT mean that consumers selecting the plan will have health plan coverage in multiple states.Select silver and gold level Individual plans that our company currently offers have been designated as OPM-sponsored MSPP…