Listen: What’s Up With The Covered California Rate Increases?

Covered California’s open enrollment bus tour makes a stop in Sacramento last November. (Ana B. Ibarra/California Healthline)

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Covered California’s announcement last week that 2019 premiums are going up nearly 9 percent, on average, unleashed plenty of complaints aimed at Washington, Sacramento and the health care industry as a whole.

The state exchange pointed a finger at the Trump administration and congressional Republicans who removed the federal penalty for going without health coverage — a key pillar of the Affordable Care Act. Covered California said rates would have risen by 5 percent if the mandate remained in place. Without it, an estimated 260,000 Californians may drop out of the individual market next year, leaving behind a sicker and more expensive pool of policyholders.

The rate increases are smaller than in the past two years. Still, consumer advocates chimed in with complaints about “sabotage” by Republicans in Washington seeking to undermine the ACA. They also faulted state leaders in Sacramento for not taking steps to shore up the state marketplace.

For instance, a proposal for additional state subsidies to help people pay their insurance premiums didn’t make it into the state budget. California lawmakers also didn’t pursue an individual mandate and penalty at the state level. Two states, New Jersey and Vermont, went that route.

Some consumers said successive rate hikes year after year have taken a toll and left them wondering whether they can afford to keep shelling out hundreds of dollars each month for coverage.

Covered California said the biggest reason for higher premiums was that U.S. medical costs keep increasing at an alarming rate, far outpacing general inflation and wage gains for workers.

Frustration with the current system has made single-payer health care a hot topic in the California governor’s race and in other election contests across the state. In light of rising premiums in Covered California, consumer advocates said California’s next governor and the legislature should revisit the Health Care Price Relief Act, an ambitious proposal that would set reimbursements for doctors, hospitals and other medical providers in the private-insurance market for both employers and individuals.

The rate-setting proposal faced heavy opposition from hospitals and physician groups, and it got shelved in May.

Peter Lee, executive director of Covered California, and Chad Terhune, senior correspondent at Kaiser Health News and California Healthline, discussed these  developments and what’s ahead with host Libby Denkmann on Southern California Public Radio.

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