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Exchange Updates Price Reducer

The big news on Monday from Covered California — that premiums will rise by a modest average of 4% in 2016 — was not the only significant news from the exchange about premium costs.

At Monday’s press conference announcing next year’s premium rates, Covered California Executive Director Peter Lee said the exchange is updating technology on the website that could dramatically reduce the cost of insurance.

Lee said the shop-and-compare tool can make a significant difference in premium cost.

“In Los Angeles County … there are two rating regions, and in one of them the weighted average of [rate] increase is less than 2%,” Lee said, “but if you shop around, you could see premiums go down by 11%.”

Rate increases are much higher in Northern California than they will be in Southern California, rising about 7% in the north part of the state next year, Lee said.

“Those in Northern California can limit [that 7% increase] to an average of 1%,” Lee said.

When you can comparison-shop, Lee said, you can find better deals in your area.

“Health care is local,” Lee said. “And competition is a key driver for costs.”

At this point, he said, we’re not really talking about the Affordable Care Act anymore; rather, the public dialogue now is focused on getting more value from the insurance coverage so many people now have.

“This is no longer Obamacare,” Lee said, “this is health care in America.”

One way to bring the cost of care down further is to have more consumer input and action, he said. “We want to have competing networks. Consumers need to shop,” Lee said. “Physicians and hospitals need to recognize that what they’re charging will be challenged by competition.”

Beth Capell, policy advocate for Health Access California, said buying health care insurance now is a lot like buying a car.

“In the old pre-ACA world no one knew the prices and before we had standard benefits there was just no way to compare,” Capell said.

Now when you look at the rate structures in the different regions and among the different insurers, she said, it’s clear where the deals are.

“It’s almost like having Edmond’s or the [Kelly] blue book in front of you,” she said. “Now you can shop for coverage. Now not everyone will do that every year, I don’t buy a car every year — but at least now you can shop.”