California Healthline Daily Edition

Summaries of health policy coverage from major news organizations

Covered California Decides To Allow Quality Ratings Next Year

On Thursday, the Covered California board voted to release quality ratings for health insurance plans offered on the exchange during the open enrollment period next year, the Sacramento Bee reports (Cadelago, Sacramento Bee, 10/24).


The Affordable Care Act requires states by 2016 to provide quality information for all plans participating in health insurance exchanges.

California previously was among several states that said they would implement a new quality rating system for health insurers during open enrollment this fall, two years earlier than required under the law.

However, California officials in August announced that they no longer planned to post the quality ratings early because data only would be available for certain plans (California Healthline, 10/23).

Covered California Executive Director Peter Lee said that issuing ratings for only a portion of policies could:

  • Cause consumers to misinterpret information;
  • Dissuade individuals from signing up for coverage; or
  • Give unfair advantage to certain insurers (Sacramento Bee, 10/24).

Letter From Three Insurers

On Monday, three large insurers sent a letter to the board criticizing the decision to delay posting quality ratings for health plans participating in the state health insurance exchange.

The letter was sent by:

  • Kaiser Permanente;
  • Sharp Health Plan; and
  • Western Health Advantage.

The insurers wrote that "there has never been a compelling reason to deny [quality rating] information to consumers."

They noted that exchanges in three other states -- Colorado, Maryland and Oregon -- already display quality data.

"We strongly urge that the display of health plan quality ratings go forward as originally planned, in the interest of both transparency to consumers and fair competition among Covered California's plan partners," they wrote (California Healthline, 10/23).

Details of Covered California Board's Decision

The five-member board voted to disclose available quality ratings next year.

Susan Kennedy -- a Covered California board member -- said, "I understand the argument about misinterpretation and fairness, but I think we have to err on the side of being fair to consumers first and foremost." She added, "I feel pretty strongly about including as much data as we have access to on quality and doing it now."

She also said that consumers could just as easily misinterpret data if the exchange only offered pricing information and not quality ratings.


On Thursday, Garry Maisel, president and CEO of Western Health Advantage, said that for months prices have been discussed as the incentive for potential customers. However, he said that "quality has got to be the issue that closes the deal," adding, " Because if this is not all about quality in the end then Covered California is going to fail and the federal exchange is going to fail."

Consumers Union and certain health policy groups suggested that Covered California next year provide caveat language for unrated plans, such as "not rated yet -- new carrier" or "in progress" (Sacramento Bee, 10/24).

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