What Is the CalChoice Program for Group Health Insurance?

When business owners want to understand options for company health coverage, one question that a group health insurance broker often receives is about CalforniaChoice. Discover what the program is, when it can be a good choice for small businesses, and what alternatives are available.



What Can a Group Health Insurance Broker Tell Me About CaliforniaChoice?

CaliforniaChoice often goes by CalChoice for short and refers to a private health insurance exchange. This marketplace allows an employer to provide coverage from various statewide and regional insurance firms instead of only offering one plan to everyone in the organization.

What Are the Advantages of Using CalChoice?

CalChoice can simplify how a company offers multiple health insurance options to employees. The service bundles plans from many insurers so that a business does not have to work with each one separately. 

Many small businesses appreciate that CalChoice allows them to offer the Kaiser HMO and Anthem Blue Cross PPO plans. The underwriting guidelines for these programs can be difficult for smaller companies to achieve otherwise, but a group health insurance broker can help a company ensure they meet the requirements under CalChoice.

Additionally, employees place a premium on benefits such as vision, dental, chiropractic, and life insurance. CalChoice can make it easier to offer these ancillary benefits, which can help companies attract top talent who value having those coverages.

What Are the Challenges To Using CalChoice?

CalChoice mandates that clients have 70% participation. Individual insurance companies may ask for as little as 25% participation, making it easier to comply when using just one insurance firm.

CalChoice also has additional administrative fees of $30 or $50. This is not part of the insurance coverage, and a representative may neglect to mention it in the initial quote. The additional expense may be an unwelcome surprise to companies on a tight budget.

Another challenge to using CalChoice is that it has many insurance choices, which seems to be a good thing on its surface. However, employees may struggle to make decisions about coverage and delay choosing a plan. 

Confusion about coverage might also occur because plans from the same provider can vary, and doctors who are in-network on one program can be out-of-network on another one from the same insurer. A good group health insurance broker can work with an organization to help employees understand their options. 

One other consideration is if employees want a Preferred Provider Organization health plan, the only option currently available with CalChoice is Anthem Blue Cross. PPO plans tend to offer access to more doctors and hospitals, which can be an advantage for individuals who travel often or want to have more choices in which medical organizations they use. 

What Is an Exchange?

The term exchange can be confusing to people shopping for insurance. The word simply refers to a single marketplace or forum to purchase various types of health insurance. When the Affordable Care Act went into effect in 2010, states set up public exchanges to help individuals, families, and small businesses purchase affordable insurance. 

California’s state exchange is Covered California, which has distinct offerings from CalChoice. CalChoice is a small group private exchange and is currently the only one of its kind in California. A group health insurance broker can help anyone shopping for insurance to compare both options.

While the Covered California public exchange ensures everyone has access to affordable insurance, a private exchange like CalChoice can offer additional options as it operates to compete in the free market. Public exchanges usually only provide medical and dental coverage. Private health insurance exchanges can offer more options for vision and hearing services, as well as 401(k) integration and other kinds of insurance products. 

How Can a Group Health Insurance Broker Help?

Small business owners are busy and rarely have the time to research thoroughly which exchange or plan could be best for their company. Just as intelligent entrepreneurs rely on experienced consultants to guide them in professional, legal, or investment matters, a health insurance broker can help a person make a sound decision regarding company health insurance plans.

Where Can You Find a Reliable Group Health Insurance Broker?

When you’re trying to decide whether to use CalChoice, Covered California, or some other option, the assistance of an experienced professional is invaluable. Talk to a group health insurance broker at Sackett & Associates Insurance Services. We’ll help you simplify your options and take the pain out of health insurance.