Cigna+Oscar Small Group California Health Insurance

Cigna+Oscar is a combination of a relatively new medical insurance company (Oscar Health) and one of the oldest medical insurance companies (Cigna).  This is a partnership that uses the Oscar high-tech options for administration and uses the large Cigna PPO provider network.  Cigna made a major investment in Oscar Health and this is more of an integrated partnership than if Oscar Health had merely rented the Cigna provider network. As they describe the relationship: Cigna + Oscar is a joint venture providing fully-insured small group health insurance. This partnership is a 50/ 50 risk sharing arrangement between the two companies. (Source: Cigna+Oscar 2023 Small Group Plans Broker Sales Kit.)

Strengths

Price Competitive: In 2023 Cigna+Oscar has been very price competitive for full network PPO plans when compared to all other insurance companies in California.  Their rates have been 10-15% less than Blue Shield or Anthem and more than 15% less than other insurance companies in some areas.

Large Provider Network: In addition to this price advantage, Cigna+Oscar offers a very large network of PPO providers in their Open Access Plus network.  A large provider network is a good thing. In-network medical providers have agreed to discount their fees, so that Cigna+Oscar members pay less for medical services from these doctors and hospitals.  The Open Access Plus Cigna+Oscar PPO network has many hospitals, doctors and other medical professionals and the number of medical providers is comparable to the other insurance company full-networks.

Cigna+Oscar also offers a small network option, the Local Plus PPO and EPO network.

Low prices, a large provider network, and comparable benefits have made this a good option for small business medical insurance in California.

Challenges

No HMO option: Unfortunately, Cigna+Oscar only offers PPO and EPO small group medical insurance plans. An EPO is an “Exclusive Provider Organization” which is like a PPO except that there is no out-of-network benefit.  This means that on the EPO plan Cigna+Oscar will only pay for services from contracted doctors and hospitals in the EPO.  If you use an out-of-network doctor or hospital, the insurance won’t pay anything.  This limitation only applies to the EPO. The PPO plans have an out-of-network benefit.

Because Cigna+Oscar does not offer an HMO, employees who had been on an HMO plan can enroll in the Cigna+Oscar EPO plan.  The EPO is similar to the HMO plans in that neither plan offers an out-of-network benefit.

New to the California Small Group Market: The combination of Cigna+Oscar is relatively new and we must wait to see if the lower price will last after the first year.  The current low Cigna+Oscar rates could be “teaser” rates where they are low for a year then increase upon renewal.  Even if the current rates increase in a year, small businesses will get the benefit of lower rates for a year. The Affordable Care Act prohibits insurance companies from asking medical questions, so, if the Cigna+Oscar rates increase next year, a California small business could easily change to a different insurance company without concern that some employees wouldn’t be eligible because of pre-existing medical conditions.