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Covered California: Cost Of Health Care Coverage Increases

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Covered California: Cost Of Health Care Coverage Increases
Covered California: Cost Of Health Care Coverage Increases
Covered California: Cost Of Health Care Coverage Increases GUESTS:Gary Rotto, director of health policy and strategic communications, San Diego Council of Community ClinicsJan Spencley, executive director, San Diegans for Healthcare Coverage

Our top story officials are declaring that the rate are a success. Rates are only going up 4%. Included in the good news Sandy Arrigo increase is even left at 2.8%. There is a wide range of insurance fluctuations. People who have group covers with employers may see significant rate hike. Here are my guest Gary of San Diego clinics. Gary welcome back Thank you we have Jan welcome to the show Some states are expecting double digits in this increase rate. I think California is a competitive marketplace. We have more hospital help systems and community health systems and managed care. Our risk of better known. They didn't know what this population would bring but now they have experience. Finally those plans in our region with 40% of enrollment came in as the Lois. So our rates really went down. From 2011 to 2014 the average insurance policy was going up 10% per year. We brought it down by 4% and that is a huge achievement. In California health officials can negotiate with insurance companies. This is not the case everywhere January provided public testimony when you covered California. They asked what type of model should be having California? I think you mentioned this Jan what part has enrollment played and keep in the rates low? We have a pretty good distribution. There was something about enrolling only young people, but that is not true. We would like more young people but it is across the board it is a mixture. There are very few children because most of the children and up in Mehdi. As were looking at what our average calls, we want to make sure that every business has it needs spread out. We want a balance and make sure that people that need a lot of attention get what they need. Period we had a lot of young people that set I see the value of having insurance because you can have a preventative care visit a part of your care. About how many people in San Diego are insured? We do not know because at a given day we have people that am role in different plans. It takes into consideration what we have enrolled who wear previously insured versus those that were uninsured. If you really look at it it is estimated around 300,000. If you best we see people all the time who have coverage and this month they don't because they lost their job. You have people who are covered by California but you do not know how long that will last. If you think about it prior to all this research of trying and re-enrolling thousands of applications on month but all those people do not qualify. What does this do to the cost of insurance? We note in a good economy that there are people that come in and out. From my understanding it is somewhat built in wit that rate. We have really reduced the insurance rate. That means that anyone plan for insurance will pay less. When I say that it is built in especially our help Center, they have an estimate of what they believe of people that will be on a sliding scale fee and they have built that in. We try to find additional coverage for people because their coverage is such narrow more margins and what they can afford to do with the insurance that they have. We are heading into the third open enrollment. This November, what have you learned that you will be doing this time around. We have a grant that was just awarded so this time we are building upon the success. We want to be a place that people can come and that grant has made that possible. People do not understand how to pick which one so that's where we will work with many individuals to help them decide. We can also be working with an extended family. We will sit down and really walk people through the process. We will make sure that we have people bear that can represent each culture each native language so that people will feel comfortable. Will have to work harder, we will have to work harder to find the uninsured and we need to find those that did not even apply. A huge issue is retention. We want people to open their male and make sure that they open it if they are enrolled in covered California. Let me interrupt you there is a flip side about the good reads. People who have other insurance may see their rates be boost as high as 19%. Should they change plans? The first thing is that they will not know about the rate hike unless they do something. If you don't review your options please come to us because we are out here. I think that is extremely important to review all of your options. We just said the second lowest plan is the benchmark. We solve no increase in the benchmark. That would be like you got and an allowance to buy insurance the allowance stayed the same but the insurance got higher. One of the things we need to remember is the great change that caused all the plans to offer the same incentive plans. So what people need to do is say let me see what this plan offers compared to what another plan may offer. We level the playing field with standardized benefits so that they cannot turn you away. The only two areas of competition are price and network. If you're seeing doctors in a network, you have an established relationship. This will help you be able to pick other doctors. There is a change come in this fall for smaller companies that provide group insurance. It will need to meet standards that Gary was just talking about. Some of these companies do not meet those standards. Therefore the people that are playing into these policies at work their premiums may go up significantly. How do you think this will play into the picture? What if it is the same benefits you tend to have a more stable population. If you are a small employer if you can't afford to all for your employees a good plan at a good rate please do not do it. We can provide meaningful coverage for those employees. Also have to consider that an employee may offer a policy to the worker but not to the family. So the question that that employee has to ask where does my family go? A lot of times and employer may offer to the family but they do not always pay for it. So whenever the employer offers for the family they cannot go to covered California even though they are responsible for paying their own insurance the company only takes care of the employee. [ Indiscernible - multiple speakers ] Like to think Jan and Gary both for coming today.

The cost of private individual health plans on California's state-run market will increase about 4 percent for the second straight year, evidence the strategy of forcing insurers to compete is controlling costs, program officials said Monday.

The average premium will rise 4 percent in 2016, a slight decrease from the 4.2 percent jump in 2015, said Peter Lee, executive director of Covered California.

The average increase in Southern California is 1.8 percent, for a total of $296 a month, compared to 7 percent, or a total of $384 a month, in Northern California. Southern Californians can get better rates because the region has more provider competition.

The exchange also added two new participants for the first time — United Healthcare, the nation's largest health insurer, and a New York startup called Oscar.

Lee said California's 2016 rates are proof that the Affordable Care Act is working in the state. He credited California's aggressive approach on haggling with insurers.

"The health plans know that if they price their products too high and consumers know it's too high, because it's an apples-to-apples comparison, they will not get enrollment," Lee said in an interview.

The announcement was applauded by consumer groups and health advocates.

"While any increase in premiums may be hard on family budgets, this relatively small jump means California made sound decisions in establishing the structure and powers of the exchange and requirement that all plans meet Affordable Care Act standards," said Betsy Imholz of Consumers Union, the advocacy arm of Consumer Reports.

Larry Levitt of the nonpartisan Kaiser Family Foundation said Covered California appears to be gaining momentum with several major insurers jockeying for market share and substantial enrollment. It's unclear how the rest of the private market will look yet, he said.

"This shows how a stable, competitive individual insurance market can work," Levitt said.

One of the main goals of President Barack Obama's health overhaul was to slow increases in health care costs and premiums.

There had been some concern that some insurers around the country were requesting rate increases above 10 percent, saying their new customers turned out to be sicker than expected.

California hopes competitive prices will translate to strong enrollment later this year. Covered Californiasigned up more than 1.3 million people during the second enrollment season. That figure fell short of an initial 1.7 million target.

Nearly 90 percent of Covered California enrollees qualify for financial assistance. Those enrollees drew down $3.2 billion in federal subsidies, or an average of $436 a month per household, in 2014, the most recently available, according to Covered California. A projection for next year was not available.

For 2016, an individual making between $16,242 and $47,080 may qualify for subsidies, while a family of four making between $33,465 and $97,000 may also qualify. Those making less would be directed to the state's Medicaid program for the poor.

Levitt said signing up more people will be a key to keeping premiums down. He noted a huge variation in premium changes across state, ranging from a 10 percent drop to a 23 percent increase.

California is among the few states that set up exchanges as an active purchaser, which allows the state to negotiate with insurers. It also imposes standardized benefits for participating plans.

Lee said California goes further than other states by deciding which health plans get to participate in individual and small business markets.

The state also made a decision early on not to extend policies that did not comply with new Affordable Care Act requirements. Lee said the move helped the state establish one risk pool to negotiate better prices.

Covered California officials say Southern California consumers can save nearly 10 percent by moving to a lower-cost plan within the same benefit design. Meanwhile, a Northern California consumer can minimize their increase to 1 percent by doing the same.

California's 2016 rate increase appears to fall in line with individual markets in other states.

A June analysis of premium changes by the Kaiser Family Foundation, a clearinghouse for information on the health care system, says consumers buying individual coverage through exchanges can expect their 2016 premiums to go up an average 4.4 percent for mid-tier plans compared to 2015.