With Covered California’s Great Reveal, It’s Time to Do Our Research
By Dena Mendelsohn on Monday, August 3rd, 2015
Monday July 27th, was a big day for Californians who buy their own health insurance: it was the day Covered California, our health insurance Exchange, revealed the 2016 premium changes they negotiated with carriers. For many who saw the headlines, there was a collective sigh of relief. Hundreds of thousands of Californians are seeing the smallest health insurance increases proposed in years. Even better, those who shop around during open enrollment may save big on premiums. On average, consumers that shop around and switch to the lowest-cost plan in the same tier they have now could save 4.5 percent on premiums in 20016—in parts of Los Angeles, the savings may be up to 11 percent.
Many northern Californians who buy individual health insurance plans, however, will see rate increase proposals averaging 7 percent if they stay on their current plan. By shopping around, consumers in the most significantly impacted regions can limit their rate increase to an average of 1 percent by changing plans while staying in the same tier. Although still lower than pre-ACA rate increases, any increase—justified or not—will impact consumers. For those with the flexibility to change carriers—and potentially provider networks—change may indeed be good.
As anybody who buys health insurance knows, it’s not the averages that matter as much as the price that each individual pays. Starting the week of August 3rd, Covered California’s website will host a 2016 Shop and Compare Tool, where Californians can get an early peek at their plan and price options, assuming the proposed rates are finalized. Rather than relying on headlines and averages, we encourage consumers to check out the tool and plug in their specifics. In addition to seeing what purchasing options they’ll have for 2016, consumers should check out whether they qualify for financial help. Nearly 90 percent of people enrolled currently through Covered California get financial help that significantly reduces their premiums. Consumers not already enrolled through Covered California may find they are eligible for subsidies that they did not expect. For example, a family of four qualifies for tax subsidies with income of up to $97,000.
Don’t want to purchase your individual health plan through Covered California? You don’t have to. All plans sold on the state’s Exchange will also be available outside the Exchange, along with additional plans that have not been vetted by Covered California. But remember: Covered California is the only place you can get the financial help, so it’s always worth checking to see if you qualify before you shop elsewhere.
While you’re researching your options, we at Consumers Union will be researching as well. All the 2016 rates announced by Covered California are subject to review by the state regulators, the Department of Managed Healthcare (DMHC) and the California Department of Insurance (CDI), and will be until the end of September. This is consumers’ and advocates’ chance to take a peek at all the reasons carriers claim to need to increase rates and to call out when the carriers’ claims don’t measure up. Want to join us? Learn more about the rate review process and how to submit comments with our FAQ and our rate review site. Check out the rate filings on DMHC’s rate review site and the California Department of Insurance’s site. We’ll post and tweet our comments using #ratereview as we submit them.