California Healthline Daily Edition

Summaries of health policy coverage from major news organizations

State Approves Covered California Rates Following Actuarial Review

California regulators approved proposed premium rates for individual health plans offered through the state health insurance exchange after actuaries determined that the prices were reasonable, according to a release by the Department of Managed Health Care, the Sacramento Business Journal reports (Robertson, Sacramento Business Journal, 7/15).

Exchange Details

The exchange -- called Covered California -- primarily will serve individuals and small businesses.

Supporters hope that the exchange will function similarly to websites like Amazon and Expedia, allowing users to choose among various health plans through an easily navigable online store.

The exchange is expected to open for registration in October, and an estimated five million people will purchase plans through the exchange in 2014 (California Healthline, 7/15).

Details of Actuarial Review

State actuaries reviewed individual plans from 13 insurers participating in the exchange, including:

  • Alameda Alliance for Health;
  • Anthem Blue Cross of California;
  • Blue Shield of California;
  • Chinese Community Health Plan;
  • Contra Costa Health Services;
  • Health Net;
  • Kaiser Permanente;
  • L.A. Care Health Plan;
  • Molina Healthcare;
  • Sharp HealthCare;
  • Valley Health Plan;
  • Ventura County Health Care Plan; and
  • Western Health Advantage.

The actuaries examined:

  • Anticipated medical and administrative costs;
  • Utilization trends; and
  • Profits (DMHC release, 7/15).

The plan rates range from 2% above to 29% below the average 2013 premium that small employers pay in California's most populous regions, according to the Journal.

Details of Rate Approval

Brent Barnhart, DMHC director, said, "Upon close scrutiny, the DMHC found that the plans have justified their proposed premium rates."

Anne Gonzalez -- a Covered California spokesperson -- said the exchange now must sign final contracts with the insurers, which should be completed by the end of the month (Sacramento Business Journal, 7/15).

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