We\’ve discussed the premium subsidies that are available to those making up to 400% of poverty towards the purchase of health insurance in California but that\’s just the start for reform changes. There\’s also a \”benefit subsidy\” for those Californians that make up to 250% of the Federal Poverty Level. This portion was designed to offset the obvious deductibles, coinsurances, and copays that would hit people at a lower income level more. Let\’s take a look at how California addressed this requirement on the plan.

California\’s take on the benefit subsidy for health insurance

The original ACA bill required that people making up to 250% of the FPL would have richer benefits for the same costs in essence. Originally, the State discussed moving people up a level if they were under 250% of the FPL. There are four basic metallic plan levels which are the Bronze, Silver, Gold, and Platinum with increasing benefit levels and costs. The original thought was that if you made 200-250% of poverty, you would be kicked up a level. For example, if you purchase the Silver plan, you would get the Gold benefits for the cost of the Silver. If you made between 100%-200%, you would get kicked up two levels. For example, if you picked the Silver and made 150% of poverty, you would get the Platinum benefits for the price of the Silver. This was the original rumor but California (as it\’s know to do) decided on a different course.

Multiple plan options at the Silver level based on income

Essentially, they created multiple Silver plans based on your income level. When you look at the Plan Benefits released by the State for Exchange plans, you\’ll see three different options for the Silver plan with 100%-150% of FPL, 150%-200% of FPL, and 200-250% of FPL at the top of the benefit matrix. This reflects the three different levels of benefits. You\’ll also see that the benefits change with each plan option with the 100%-150% plan having very very rich benefits (no deductible, low copays, low co-insurance). The next level up at 150-200% is still very rich relative to anything out on the market but less rich than the 100-150% plan. The 200-250% continues this trend forward. There are no additional plan options beyond the 250% since the law required richer benefits up to 250% of poverty. Obviously, your income level now greatly affects the cost you will pay both for health insurance and for actual medical costs.

Silver is the new color for subsidized health insurance

If you make under 250% of poverty (estimate around $30K for an individual or $55K for a family of four…more detail here on the levels), you\’ll likely find better values in the Health Exchange and you will choose a Silver plan. Which Silver plan depends on on your income level (the three different percentages of the FPL above). It will be hard to justify going any other direction for health insurance for those making under 250% of poverty. If you make over 250% of poverty but under 400%, the bronze will probably make sense depending on the cost for yourself. You will receive premium subsidies but the cost difference between the bronze and silver might make the Bronze more attractive. If you make over 400% of poverty, costs will likely be very high across the spectrum of Metallic plans on the individual family market.