Dive Brief:
- L.A. Care Covered, described as the largest publicly run health plan in the U.S., has arranged a process to allow their members to pay health premiums with cash by visiting retail locations that are part of the PayNearMe network, including 7-Eleven and Family Dollar Stores.
- The free service is intended to serve customers who do not have a traditional bank account. According to a study by Jackson Hewitt Tax Service, one in four Americans who were previously uninsured and now qualify for federal subsidies do not have a bank account. Those customers must otherwise utilize pre-paid debit cards or money orders.
- L.A. Care has estimated that as many as 25% of its marketplace customers pay each month by mailing in money orders.
Dive Insight:
L.A. Care is the first health insurer to partner with the PayNearMe network.
The federal government has required that health plans accept payment through options that don't require a credit card or checking account, but it has not required that they accept cash—something questioned by advocates for "unbanked" households, where members are typically low-income and trying to avoid bank-related fees.
L.A. Care does not expect the PayNearMe service to increase its administrative costs.
When customers visit a store, they will scan a bar code from their phone at the register and then pay accordingly. Payments will post to L.A. Care within 24 hours.
"What goes in is cash, and what comes out is an electronic payment," PayNearMe CEO Danny Shader told Kaiser Health News. "We think everybody ought to do it."