III. California's Approach to Providing Affordable Insurance for Documented Mexican Immigrants: Private Binational Health Insurance
California permits certain licensed insurance companies to sell employer-sponsored health insurance to documented Mexican immigrants that offer the majority of care in Mexico. Known as binational health insurance plans, they are so-named because they offer medical coverage in networks that include health care providers in the United States and in Mexico. The 1975 Knox-Keene Health Care Act (Knox-Keene) authorized California insurance companies to sell binational health insurance plans that offered health care services in California and in Mexico. More than twenty years later, Knox-Keene was amended to permit Mexican companies to also sell binational plans, provided they met Californian regulatory requirements. Knox-Keene binational plans are limited to employer-sponsored health insurance and can only be sold to documented Mexicans residing in California.
Though binational health insurance has existed in California since the 1970s, for many years Californian health insurance companies did not sell binational health insurance plans. However, when Mexico's Sistemas Médicos Nacionales, Sociedad Anónima (SIMNSA) was licensed under the Knox-Keene amendment in 2000 and began to sell binational health insurance, a strong market emerged. Encouraged by SIMNSA, other California-based private health insurance companies soon developed their own binational health insurance products. Blue Shield of California, HealthNet, Sekure Healthcare, and an Employee Retirement Income Security Act (ERISA) plan offered by the Western Grower's Association are examples of Californian companies that have begun to sell binational plans.
Most binational plans sold by Californian companies offer emergency and preventative health care services in California and Mexico. Southern California, Tijuana, and Mexicali generally constitute the coverage areas. For services not available in Mexico, Californian companies can refer subscribers to covered health care providers in California. Health maintenance organization (HMO) and preferred provider organization (PPO) plans are available.
SIMNSA plans are similar to Californian company plans in that they offer HMO and PPO plans; however, they differ slightly because, except for emergency care which is covered in California and in Mexico, SIMNSA offers their subscribers coverage exclusively in Mexico.
The California Department of Managed Health Care (DMHC) supervises binational health insurance plans. The DMHC requires Californian companies to ensure their Mexican health care providers maintain state health care standards. The DMHC can also impose fines and revoke licenses when Californian companies do not comply with state health regulations. The DMHC cannot directly enforce California state regulations on Mexican companies, but it can revoke their licenses to sell binational plans in California.
Employers and their employees who choose binational plans receive significant financial savings. For example, HealthNet's “Mexi-Plan” costs $75 per month, forty percent cheaper than comparable U.S. employer-sponsored health plans. For a family of three, HealthNet's “Salud con HealthNet” costs under $4,800 per year. Compared with the average of $20,000 spent on health insurance by U.S. families with employer-sponsored plans in 2011, binational plans are significantly more affordable for documented Mexican immigrants.
Encouraged by relatively low costs, employers in southern California have begun to offer binational health insurance plans to their Mexican immigrant employees. Employment sectors with a high number of Mexican workers that have not traditionally offered employer-sponsored health insurance, such as the textile, agricultural, and service sectors, have seen increased health care coverage through binational plans. It is estimated that 150,000-200,000 Mexican immigrants have enrolled in a binational health insurance plan since 2000. However, over two million Mexican immigrants in California remain uninsured. This exposes weaknesses in California's system. Explanations vary. Some point to the geographical restrictions in the plans. Others say the tenuous immigration status of many Mexican immigrants makes them reluctant to frequently cross the border. Still others say not enough employers and qualified documented immigrants know about binational health insurance. Before Arizona would sanction private binational health insurance, it would behoove the state to address the challenges seen in California's system.
