Getting ready for fall's open enrollment for healthcare? Brace yourself for higher premiums, especially if you reside in this sunny part of the country.
Just two months ago, the Affordable Care Act, also known as Obamacare, was lauded for helping California reduce its uninsured rate to 8.1 percent last year — a record low for the Golden State (which had a 17 percent uninsured rate in 2013) and a full percentage point below the national uninsured rate for 2015 of 9.1 percent.
Supporters of the landmark 2010 health care reform law often point to California as the poster child for Obamacare’s success, so a recent announcement by Covered California, that premiums for policies on that state insurance exchange will rise by an average 13.2 percent for 2017, came as a shock to many.
The double-digit rate hike comes on the heels of two years of premium increases closer to 4 percent in California.
“Even though the average rate increase is larger this year than the last two years, the three-year average increase is 7 percent — substantially better than rate trends before the Affordable Care Act was enacted,” Covered California Executive Director Peter V. Lee said in a statement.
Lee says insurers’ planned premium hikes in California reflect the rising cost of health care, including the hefty price tags on specialty drugs. But that does little to soften the blow for consumers, says Kaiser Health News.
“While these rates hikes aren’t as bad as the annual double-digit increases before the Affordable Care Act, that’s not much comfort to consumers who don’t see their paychecks increase by the same percentage,” said Anthony Wright, executive director of Health Access, a consumer advocacy group.
According to the Los Angeles Times, two of California’s biggest insurance companies — Blue Shield of California and Anthem Inc. — are implementing the biggest hikes there, 19 percent and 16 percent increases, respectively. What the premium increases will mean for Californians insured through Covered California depends on a number of factors, including in which region they live and which insurer provides their coverage — as well as whether they qualify for subsidies under the ACA to help pay their premiums.
“The impact will depend on whether they get taxpayer-supported subsidies for their premiums and whether they are willing to switch to less-expensive plans that may come with higher co-pays and deductibles,” explains the Los Angeles Times. “Changing plans could also mean a new network of physicians, which could be disruptive to care for those with chronic conditions.”
The health insurance exchanges are online marketplaces where consumers who don’t receive insurance through an employer can compare and purchase private health insurance. California is one of a dozen states that operates its own health care exchange as designed under the ACA. The federal exchange, www.healthcare.gov, is the default exchange for residents of states that chose not to establish their own marketplaces.
In total, the state and federal health insurance exchanges have provided insurance for about 12 million Americans, the Times reports.
Covered California’s anticipated hike in premiums is the latest blow to the ACA, which has been under attack by critics since President Barack Obama signed it into law in 2010.
UnitedHealth, the nation’s largest health insurer, announced in April that it was exiting all but a handful of state insurance marketplaces, citing financial losses.
Check out “Obamacare Insurance Premiums Higher in 45 States.”
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