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Small Business Employee Benefits and HR Blog

A Guide to State Guaranteed Coverage in California

california guaranteed healthNote: None of this should be taken as legal or tax advice.
 
In a recent post, we provided a state-by-state guide to guaranteed issue individual health insurance. While this guide may be helpful as a national overview, it does not provide state-specific information on th policies or application requirements. Since regulation of insurance is a state responsibility, the process for obtaining guaranteed issue health insurance varies from state to state. The purpose of this post is to provide a concise guide to purchasing guaranteed issue individual health insurance in California. If you have questions, please leave a comment.

In California, there are three different ways to obtain guaranteed issue individual health insurance (assuming you do not already qualify for Medicare, Medicaid or another program):
    1. HIPAA Plans (All individual market carriers are required to offer these plans to eligible individuals)
    2. Conversion Policies (An individuals previous group insurance carrier is required offer these plans to eligible individuals)
    3. MRMIP (The state offers these "state risk pool" plans to eligible individuals)
HIPAA Plans

California's HIPAA program is different from many states because the state risk pool (MRMIP) is not the insurer of last resort for HIPAA eligibles. California meets its HIPAA requirement using the "Federal Fall-back" method. Under this HIPAA approach, all individual market carriers in California are required to offer a HIPAA policy to eligible individuals. If you qualify for a HIPAA plan, you cannot be denied insurance because of pre-existing conditions. For applicable rates and policy options, see the Department of Managed Health Care website.

Conversion Policies

In California, an employee may also be eligible to purchase a guaranteed issue individual "conversion" policy if they lose their group health insurance. This is called a conversion plan because the employee converts from the group policy to an individual policy. When an employee's group plan ends, the group carrier must offer eligible employees (employees with 3 months creditable coverage) an individual "conversion" policy. If you qualify for a conversion plan, you cannot be denied insurance because of pre-existing conditions. For applicable rates and policy options, see the Department of Managed Health Care website.

MRMIP

MRMIP (Major Risk Medical Insurance Program) is California's state risk pool for people with health problems who are not able to buy individual health insurance and are not eligible for the above HIPAA or Conversion plans. Californians qualifying for the program participate in the cost of their coverage by paying premiums. The State of California supplements those premiums to cover the cost of care in MRMIP. Because of funding limitations, MRMIP does sometimes have a wait list. For applicable rates and policy options, see the MRMIP website.