Your Health Insurance Questions, Answered

When it comes to health insurance, understanding your options can be a bit complicated. There are many common points of confusion out there, but let’s set the record straight.

1. Why can’t I enroll in a health plan whenever I want?

In most cases, you can only apply for a new health plan once a year during a period called “open enrollment,” which runs from November 1 through January 31. The enroll-by window is meant to help keep the cost of health insurance down. Without a limited enrollment period, healthy people might wait until they’re sick or injured to purchase a plan, driving up costs for everyone. Imagine if you could purchase car insurance after an accident — car insurance would likely cease to exist. By establishing a limited window to sign up for insurance, companies are assured that they’re serving both healthy and sick members — and that premium costs don’t skyrocket.

If you experience certain life-changing events, such as losing health insurance due to job loss, getting married, having a baby, or moving to or within California, you may be eligible for special enrollment outside the annual open enrollment window.

If your annual household income is at or below 150 percent of the federal poverty level, or if you qualify for Medi-Cal, you can also enroll at any time of year.

2. What makes health insurance a good idea financially?

Health insurance can be a significant monthly expense. Monthly premiums may sound like a lot of money — that is until you take a look at what health care costs. Setting a broken leg can cost up to $7,500. The average cost of a three-day hospital stay is around $30,000. Treating cancer can cost hundreds of thousands of dollars. Health insurance provides an important financial safety net to help protect you from high, unexpected costs like these. When you think of health insurance as an investment in your overall physical and financial well-being, the cost may seem more reasonable.

Plus, health insurance might not be as expensive as you think. Covered California negotiates with insurance companies on behalf of consumers to lower costs, while also connecting members to federal financial help. Many people are unaware that they might qualify for financial help through a free service like Covered California. Roughly nine out of 10 enrollees who use Covered California get financial help to lower the cost of their monthly premiums. Try our quick calculator tool to see how affordable health insurance can be and how much financial help you can receive.

3. Why do I have to pay a deductible and copays when I already pay a monthly premium?

When it comes to the total cost of health insurance, there are typically three components: premiums, deductibles, and copayments. The premium is your monthly payment to secure coverage, the deductible is the amount you’re responsible for before full coverage kicks in — similar to car insurance where you might need to pay a deductible to cover part of a repair — and copayments are set amounts you pay per visit or treatment.

Many insurance plans include both deductibles and copays. A general rule is that policies with higher premiums have lower deductibles and copays, while those with lower premiums have higher deductibles and copays. By offering a diversity of plan options, health insurance companies provide consumers the opportunity to choose a plan that best suits their needs.

Through Covered California, you can choose among four categories of health plans: Bronze, Silver, Gold and Platinum. The benefits are the same for each tier, but they differ in how costs are split between you and your health plan. For the Gold and Platinum tiers that have higher monthly premiums, members aren’t responsible for any deductible at all.

The most important point though is that by selecting a health plan, you are in charge of how much each component might cost. Choose the category of plan that works for your health, your family and your budget.

4. Can I still get health insurance if I have a pre-existing condition?

There was a time when people who had pre-existing health conditions were denied health insurance coverage or penalized with higher premiums. The Patient Protection and Affordable Care Act changed that.

If you have a pre-existing medical condition, you can’t be denied health insurance coverage — and you won’t have to pay more because of it.

5. Why do I need health insurance if I’m healthy?

Health insurance is a smart move for your overall health — plus, it’s the law. Starting in 2020, uninsured California residents may face financial penalties come tax time, unless they qualify for an exemption.

Penalties aside, having health insurance is a critical part of maintaining a healthy lifestyle. Preventive measures such as tests, immunizations, and screenings are often covered at no cost, and may head off costly health issues that could otherwise go undetected. Also, even if you are in good health, eat well and exercise, no one is immune to accidents. Remember that $7,500 hospital bill for a broken leg? Invest in health insurance to give yourself a safety net and to help you stay healthy for many years to come.

Learn more about the basics of health coverage.