This Tuesday, August 1, Covered California released the proposed rates for the 2018 individual market. It is estimated that rates will increase by an average of 12.5% across the state to keep the states’ individual market stable. Covered California adopted a policy for health plans to submit two different versions of their rates: (1) assuming continued payment to fund CSRs and (2) a “separate CSR surcharge to “load” any costs to fund this program onto Silver-tier.” The reason why the CSR surcharge only applies to silver-level plans is because only individuals (between 139%-250% FPL) enrolled in these plans can benefit from CSRs.

In southwest Los Angeles, the expected regional rate increase is 13.2%. Consumers in this region will have access to Blue Shield (PPO, HMO), Healthnet of CA (HSP, HMO, and PPO), Kaiser Permanente, L.A. Care (HMO), Molina Healthcare (HMO), and Oscar (EPO).

Why are rates increasing in California?

  • 7% is due to increases costs of providing medical care
  • 8% arises from the end of a federal health insurance tax holiday
  • 3% from the insecurity over the ACA

Covered California plans to address the uncertainty for consumers by spending approximately $106 million on marketing, which Peter Lee, Covered California executive director, considers “an investment in better rates.”

 “Covered California remains robust and strong, and we are pleased to welcome back all 11 plans to compete in regions across the state,” said Covered California Executive Director Peter V. Lee. “While there is ongoing uncertainty and a lack of clarity at the federal level, consumers who need affordable health insurance will continue to have good choices in Covered California next year.”

Open Enrollment Period Changes

Due to Federal Regulations from April 2017, the 2018 Open Enrollment Period will be from November 1, 2017 to December 15, 2017. This period is shorter than the open enrollment period for previous years. Please help spread the word!

Individual Market in 2018

Anthem Blue Cross of California is withdrawing from 16 out of the state’s 19 regions due to uncertainty on whether the federal government will pay for cost sharing reductions (CSRs) in 2018. Beginning next year, Anthem will only offer plans in three Covered California Rating Areas, including Region 1 (Redding/ Far North), Region 7 (Santa Clara County), and Region 10 (Stockton/Modesto). It is important to note that these changes will not affect people with Anthem’s Medi-Cal, Medicare Advantage, and employer-based insurance. Overall, Anthem will cover 108,000 consumers across California in these regions (41% of their current enrollment). Covered California estimates that 84% of doctors contracted by Anthem are also accessible through other health plans.

Competition & Choice

  • Blue Shield of California is increasing its HMO component to a greater part of Region 2 (Marin, Napa, Solano, Sonoma counties) and Region 12 (Ventura, San Luis Obispo, Santa Barbara counties) and expanding to cover Region 5 (Contra Costa County) and Region 6 (Alameda County) from partial to full coverage.
  • Health Net is providing a new PPO product in some ZIP codes in Region 3 (Sacramento, El Dorado, Yolo counties) and Region 17 (Riverside, San Bernardino counties) and the entireness of Regions 15 and 16 (Los Angeles County), Region 18 (Orange County) and Region 19 (San Diego County).
  • Oscar Health Plan of California is offering a new EPO product in some ZIP codes in Region 15 (Los Angeles County).