There have been recent changes to California's health insurance market. You should be aware of the changes because rumors are abounding and it's essential you have the correct information.
First, you may have heard a rumor that California is going to eliminate private health insurance companies from the state. This information is false. California has not, and won't be removing private plans from the market.
However, the California legislature did make one significant change to the insurance marketplace. There was a form of health insurance on the market called "short-term" health insurance. This type of plan was developed to cover people when they were in between jobs and didn't have any health coverage.
Critics of the plans said they were "junk insurance" because the coverage they provided wasn't long enough in time and low quality. Earlier in the year, the legislature began approving a bill that would prohibit the sales of the policy. The bill still isn't a law. However, the insurance industry responded by shutting down sales in the state.
People still have the option to purchase "fixed-benefit health plans". These are plans limited to a specific amount of time and provide limited coverage and benefits. These plans are cheaper than traditional health coverage, but as the name implies, the coverage is nowhere near as comprehensive as a regular plan.
How does this affect you?
The effect on you is minimal since these aren't policies most companies would offer their employees. However, if you have a new employee who refuses medical coverage during their onboarding, you might want to make sure they aren't referring to a fixed-benefit plan.
This may seem pointless, but consider the implications to your company if one of your employees has minimal coverage and they aren't entirely covered. You could find yourself with an employee on the verge of economic distress as they struggle with the costs of inadequate coverage.
Is California going to universal health care?
The upcoming election will see California electing a new governor. The Democratic candidate, Gavin Newsom, is a proponent of universal health plans. Universal health plans are policies supported by taxes, and essential medical care is paid for by the government. Thus, the name 'single-payer." This type of insurance is the center of a contentious political debate.
First, if Gavin Newsom is elected governor, there won't be an abrupt change to health coverage. While it's a plan of his, many people oppose universal health care, and there is a tremendous amount of federal legislation that would have to change to implement it at the state level.
Even if there was an implementation of the plan, you probably would still want to offer a health insurance plan to your employees. Universal health care insurance only covers essential care, providing a supplemental insurance plan would help employees receive more benefits.
Culture Insurance is a premier insurance broker in the San Diego area. We work with our clients to help provide comprehensive packages that not only protect employees but also enhance the attractiveness of your company to new hires. If you have any questions about insurance, or how changing legislation could affect you, we encourage you to contact us.