If you didn’t sign up for individual health insurance in California during the open enrollment period, you’re not stuck. A little known state program, Major Risk Medical Insurance Plan (MRMIP), may be your saving grace. While no insurance company will offer you coverage outside of the open enrollment period unless you have a special circumstance, we just learned that the State of California’s MRMIP plan will enroll individuals into their “high risk” plan at any time of the year.
The Major Risk Medical Insurance Program is funded by the state’s tobacco tax. This is a link to the MRMIP plan description and application. To be eligible you must:
- Meet the California residency requirement (i.e, not be out of state for more than 210 consecutive days); and
- Not be eligible to enroll in Medicare Part A or B; and
- Not be eligible to enroll in any other health insurance plan, including COBRA or Cal-COBRA.
You’ll also need a letter from an insurance company that has declined to offer you coverage within the previous 12 months. If you meet this criteria you should contact BenefitsCafe.com, 800-746-0045 and we can assist you with the MRMIP application. We’ll become your agent and can assist you should you have any questions or difficulty – all at no additional cost.
No Enrollment Waiting Period and No Limit on Enrollment Duration
As of September 2015 MRMIP has no waiting period to enroll onto the MRMIP plan. This is a big deal because before Covered California came into existence, MRMIP had a year’s long waiting list to get on the plan. Also, years ago, MRMIP restricted coverage to a 36 month coverage period. No longer. Now, there is no wait to enroll and no limit on the duration of MRMIP coverage.
NOTE:You’ve got to enroll by the 10th of the month for coverage to begin the 1st of the following month and coverage only begins the first of each month.
Here are a few things that you should understand about the MRMIP individual plan:
MRMIP plans satisfy the mandate that everyone have medical insurance coverage. This means that enrollees don’t have to pay the Federal Tax Penalty for medical insurance. This is truly unbelievable. The Affordable Care Act (ACA, Obama Care) requires that all medical insurance plans have “Minimum Essential Coverage” or “MEC.” This prevents people from buying really low cost plans with skimpy benefits. Surprise, surpise, the Federal government has exempted all state run high risk programs from the MEC requirement. That’s important because a unique feature of the MRMIP plan is that it limits the annual calendar year benefit to $75,000 and $750,000 lifetime. Such low limits by any other insurance plan would violate the MEC requirements, but not on this plan.
At our prompting, MRMIP posted this FAQ which states that “MRMIP has been granted permanent MEC designation” by the Federal government. So, despite these low yearly and life-time benefits, the MRMIP plans will enable an enrollee to avoid the Federal income tax penalty.
NOTE: The FAQ is very important because it directly refutes page 2 of the MRMIP brochure which advises applicants that “if you have only MRMIP coverage in 2015, you may be subject to a tax penalty for the 2015 tax year. (You may have to pay a penalty of the higher of $325 per adult or 2% of your household income).” Again, according to the FAQ, MRMIP coverage satisfies the IRS requirement for health insurance coverage.
Pre-Existing Condition Exclusions and Waiting Period: The PPO plan has a “Pre-existing condition” exclusion. This means “any condition for which medical advice, diagnosis care, or treatment,including use of prescription drugs, was recommended or received from a licensed health practitioner during the six months immediately preceding enrollment in the MRMIP. For subscribers and dependents enrolled in a PPO, there is a pre-existing condition exclusion period of three months. During this period no benefits or services related to a pre-existing condition are covered. However, subscriber contributions are paid during this period.” See page 4 of the brochure. The HMO has a 3 month “waiting period” where coverage won’t begin (and you don’t pay any premium) for 3 months after enrollment. This applies to people with no prior coverage. After the third month, coverage begins without limitation to pre-existing medical conditions.
An interesting note is that according to the MRMIP staff, coverage in a short term policy will not impact one’s ability to obtain a MRMIP plan. Also, the time on a short term plan will count towards the three month pre-existing waiting period. So, if you have a short term policy for three months and then move to a MRMIP plan, you will not have a pre-existing exclusion or waiting period. See the section on “short term coverage” below.
What are the benefits of the MRMIP individual plans?
MRMIP Plan Benefits (NOTE: the calendar year and lifetime limits described above apply to both plans)
Anthem Blue Crossoffers a $500 deductible PPO plan with $25 Dr. Office visit copayments. The plan pays 85% for most services in-network and 50% for out of network services. See page 9 of the brochure. The calendar year out-of-pocket limit is only $2,500 per member, $4,000 per family. A major feature of the PPO plan is that it includes the FULL ANTHEM PPO provider network, not the limited PPO networks that are coupled with other Anthem individual plans.
Kaiser Permanente offers an HMO plan plan with a $500 calendar year deductible. You must pay the deductible before you can begin to pay copayments for medical services. The plan has $20 Dr. Office visit copayments and $200 per day in-hospital charges. The calendar year out-of-pocket limit is only $2,500 per member, $4,000 per family.
What are the rates of the MRMIP individual plans?
MRMIP uses only three variables to determine the rates: geographic area, age and plan type (PPO or HMO). One interesting feature is that the rates use “age bands” so that it is the same rate for a person age under age 15, age 15-29, 30-35 and then 5 year age categories. The rates for these plans seem pretty affordable compared to the rates for unsubsidized individual coverage. For example, a 34 year old in Los Angeles (area 5) would pay $378.31/month for the Anthem PPO and $332.67/month for the Kaiser HMO plan.
What about short term medical insurance?
Short Term Coverage: Short term medical insurance plans had been the only option for people who didn’t enroll during the open enrollment period. Short term policies however often exclude coverage for pre-existing prescription medicine and other conditions. Worse yet, the short term policies normally do not meet the “minimum essential benefits” (MEC) criteria and a person with a short term medical plan must likely still pay the tax penalty associated with having no health insurance. If you’re not eligible for the MRMIP plan, you may want to enroll in a short term plan. The staff at BenefitsCafe.com can assist you with selecting and applying for a short term policy.
MRMIP may be a life saver to those who can’t otherwise obtain coverage. Click here to get the MRMIP application and give us a call at 800-746-0045.