What are the Best Covered California Plans for 2023?

Covered California is the state-run ACA exchange offering Californians affordable health insurance options. Open enrollment is near, spanning the months of November 1 2022-January 31, 2023. This article will highlight the most affordable Covered California plans using the persona of a 30-year-old female who does not smoke, has no disability, and makes $70,000. 

What are the Best Covered California Plans?

We’ve highlighted 19 health insurance plans offered by Covered California insurers based on the lowest deductible and monthly premium for 2023. For this article, we used the persona of a 30-year-old female who does not smoke, has no disability, and makes $70,000 to gather our data. Additionally, we used the zipcode 90011 to account for the highest population based on U.S. Census Bureau Estimates. Results are also based on medium-use doctor visits and low-use prescription drugs. 

19 Best Covered California Health Insurance Plans based on Lowest Deductible and Monthly Premium

Source: coveredca.com

Defining HMOs, PPOs, and EPOs 

Health insurance terms can be confusing. To save you several google searches, visit the Mira article to familiarize yourself with the most common terms you’ll come across when navigating your insurance process. 

Health Maintenance Organizations (HMOs)

HMOs usually limit coverage to care among doctors working for or in contract with the HMO. Out-of-network coverage is generally not covered except in cases of emergency. Coverage may also depend on whether you live or work within the area they service. 

Features of HMOs include: 

• Typically have lower insurance premiums and out-of-pocket costs
• Lots of flexibility in choosing providers
• Requires a primary care physician (PCP) referral before seeking specialty care
• If out-of-network providers are used, expect to pay entirely out-of-pocket

Preferred Provider Organization (PPO)

PPOs allow you to choose your preferred physician or healthcare provider, whether in-network or out-of-network. This means you don’t need a referral from a primary care physician to visit other providers.

Features of PPOs include:

• Typically have higher premiums than HMOs or POS plans
• Those enrolled can freely seek specialists and out-of-network physicians without a referral
• A great option for those requiring frequent and various care and who can afford higher premiums

Exclusive Provider Organization (EPO)

EPOs are a budget-friendly managed care option. They are typically more restricted in their coverage and only cover in-network services. 

Features of EPOs include: 

• Usually have a more extensive network than HMOs
• May not require a referral from a primary care physician.
• Premiums are higher than HMOs but lower than PPOs

What Should I Consider When Picking a Health Plan?  

When looking for a health plan, you should consider a few things. First, you must consider your health needs, finances, and how much you can afford. These things will likely change as time goes on, but understanding before selecting will help you make the best decision.

What are your health needs?

When picking a health plan, you want to consider your health needs. This includes what medications you currently take, chronic conditions like diabetes, and how often you need to see your medical provider. If you frequently visit specialists, needing a referral from your PCP can be more difficult than helpful. Finally, consider whether you plan on making any major life changes soon.

Life changes can include:

• Having a child
• Getting married
• Retiring early
• Moving
• Switching careers

Once you’ve figured out your health needs, you can move on to the next step of deciding which health plan is best for you. Some health plans also provide you with dental and vision care.

If you’re looking for a health plan to cover you and your family, you can still consider the above to help rank your options. If you’re married, your spouse may receive health insurance through their job; check to see if their plan offers more benefits.

What’s your financial situation?

After you’ve thought about your health needs, take the time to calculate your budget moving forward. Including things like housing, transportation, and even entertainment costs is important. Then you can see how much of your budget can go toward health insurance.

If you’re someone with an income that fluctuates, such as a freelancer or short-term contracted employee, you should think about how this will impact your budget at its highest and lowest. For people who live in cities with a high cost of living, you will find that the average cost of health insurance for one person varies compared to cities with a low cost of living. 

You’ve done your budget and understand how much your current lifestyle affects your finances. Be mindful not to blow all your money on health insurance, as you still need a savings account. We’ve even figured out a few things to keep in mind when lowering your expenses.

How much can you afford?

You have your health needs and budget figured out. Now you can select the health plan that will best meet your needs. If you find that you will have a high deductible, you can offset that with a service like Mira that offers a significant discount on lab tests and prescriptions.

Average Marketplace Premium for California by Metal Tier, 2018-2023

Source: KFF

If you decide to select a high deductible health plan (HDHP), you will find that you will have a lower monthly premium. These plans are typically helpful to relatively healthy people who don’t plan to have significant medical expenses. You can pair an HDHP with a Health Savings Account (HSA), which allows you to use your pre-taxed funds towards medical expenses like copays and deductibles. However, you cannot use this to pay for your monthly premium. 

What if you frequently travel?

If you travel a lot and need coverage during this time, look at PPO plans. Preferred Provider Organization plans will give you access to out-of-network coverage and allow you to see specialists without a referral. These plans do often come with a high premium.

Source: coveredca.com

Source: coveredca.com

What happens if you can’t afford any plan on the exchange? 

California State Penalty

California has a minimum penalty of $800 per adult and $400 per dependent child under 18 for residents who do not have coverage as of 2022. You may also use the tax penalty calculator to estimate what you may owe. Californians must have qualifying health insurance coverage, pay the penalty when filing a state tax return, or get an extension from the requirement. 

To qualify for an exemption, you must complete an application through Covered California or claim your exemption when you file your state tax return. Below is a guide on how to apply for an exemption based on the two options.

Claiming Exemption when Filing State Taxes

To claim an exemption when you file your state taxes, check if your income is below the state tax filing threshold. Exemptions you can claim include:

• A short coverage gap of three consecutive months or less
• Unable to afford health coverage based on actual income reported on state tax return
• Certain non-citizens who are not lawfully present
• Citizens living abroad or residents of another state
• Members of:
  • A health care sharing ministry
  • A federally recognized tribe
  • Individuals eligible for services through an Indian health care provider or the Indian Health Service Incarceration
  • Enrolled in limited or restricted-scope Medi-Cal or similar coverage

Applying for Exemptions Through Covered California

The 3 exemptions you can apply for through Covered California are General Hardship, Affordability Hardship, or Religious Conscience. To apply, you must meet the criteria under your exemption and gather the required information. This will typically include basic information such as your date of birth, social security number, proof to support your claim of hardship, etc. 

Additional Savings 

The recent passage of the Inflation Reduction Act (IRA) in August of 2022 expands financial coverage options for Californians to receive more care and savings. Before this law, Californians whose incomes were too high to qualify for financial help were provided a state subsidy, also known as premium tax credits. With additional funding from the federal government through the IRA, coverage is expanded for everyone receiving the state subsidy in the past. To check if you qualify for extra coverage, check out the shop and compare tool to view your estimated savings. 

How to enroll for Covered California

There is one application portal for Covered California, and you can apply online, with a certified enroller, or by phone. Before starting your application, ensure you have the necessary basic information, such as your email, DOB, SSN, Federal Tax Information, income information, etc. Next, follow these steps to ensure you choose the best plan that fits your needs.

Step 1: Have All Relevant Information Ready

Step 2: Know What You Should Consider When Browsing Plans

Step 3: Select the Best Option for Your Needs

We've created a short guide to help you if you want more guidance.

Covered California Frequently Asked Questions (FAQs)

Below are some frequently asked questions about health insurance in California we gathered for you.

What health insurance terms should I understand during this enrollment period?

We’ve gone over PPO, HDHP, and HSA. You should also know what a Flexible Spending Account (FSA), Self-Pay Pricing (SPP), and Special Enrollment Period (SEP) are. We have a list with a few more insurance terms that will help you during this enrollment period.

What requirements do I need to meet to be eligible for coverage in California?

Residents of California who don’t have access to affordable health insurance coverage can get a health plan through Covered California. Additionally, most immigrants qualify for coverage as well. The following groups include: 

• Lawful permanent residents (green card holders).
• Lawful temporary residents.
• Persons fleeing persecution, including refugees and asylees.
• Other humanitarian immigrants, including those granted temporary protected status.
• Non-immigrant status holders (including worker visas and student visas)

What are the benefits that my plan is required to provide?

Your plan is required to provide the following 10 essential health benefits: 

1. Ambulatory patient services (outpatient care you get without being admitted to a hospital).
2. Emergency services.
3. Hospitalization (like surgery and overnight stays).
4. Pregnancy, maternity, and newborn care (both before and after birth).
5. Mental health and substance use disorder services, including behavioral health treatment (this includes counseling and psychotherapy).
6. Prescription drugs.
7. Rehabilitative and habilitative services and devices (services and devices to help people with injuries, disabilities, or chronic conditions gain or recover mental and physical skills).
8. Laboratory services.
9. Preventive and wellness services and chronic disease management.
10. Pediatric services, including oral and vision care (but adult dental and vision coverage aren’t essential health benefits).

When is the special enrollment period?

If you miss open enrollment, and you’ve had a qualifying life event such as having a baby, a change in income, or health insurance loss, you may be able to apply 60 days prior or 60 days after the event to enroll in a health plan. To see if you qualify, go to healthcare.gov and fill out a few questions. The site will direct you to either answer more questions or to the site for Covered California.

Bottom Line 

Covered California is the state-run ACA exchange offering Californians access to quality and affordable care with or without financial assistance. Open enrollment begins November 1-January 31, 2023, so it’s essential to familiarize yourself with the health insurance process during this timeframe. Depending on your income, it might be best to enroll with Covered California or purchase directly from a health insurance company. To ensure you get the most accurate offers, use the shop and compare tool on their website to determine what’s most cost-effective for you. 

If you’re looking for a more affordable alternative to health insurance, memberships such as Mira exist and might be a better fit for you. For just an average of $45 per month, members get access to low-cost urgent care visits, affordable lab testing, and discounted prescriptions at up to 80% off. Sign up today and start saving on healthcare!