While the individual health insurance market represents only about 7% of those covered by health insurance, it is an important indicator of how the market is performing. Currently almost 1.6 million California consumers are covered through Covered CA, the state health insurance exchange.
Covered CA recently announced rate increases for 2022 of 1.8% average statewide. A search of the Dept of Insurance website does not show the filed rates as yet, so we cannot see how Shasta County will be effected. Historically our increases are higher than the average due to the demographics of our region.
The California pool is bragging that this is their 7th straight year among the top 5 states with lowest Plan Liability Risk score. This score effectively rates the health of the participants in the plans and whether the premiums are enough to cover the risk. This year it was partially attributed to the expanded enrollment. A larger pool including younger and healthier people will reduce the net costs to the plans.
Deferred care due to the pandemic kept costs lower. It remains to be seen, when that will increase again. Or maybe Americans are learning to reconsider elective procedures?
Consumer premium costs for those covered on the Exchange and eligible for subsidies have decreased dramatically. The American Rescue Plan as well as CA state-specific subsidies have cut many folks premiums by half or more. Some Insureds are paying as little as $1 month for high deductible plans.
The Supreme Court rejected the latest challenge to the Affordable Care Act (ACA) last month. This established that the ACA will continue to be the law of the land as we close in on the 10th anniversary of the Act. Of course, that does not preclude a new administration from issuing executive orders to further undermine it in the future.
AHIP, the American Association of Health Insurance plans has called for an extension of the expanded subsidies into 2023 with the statement that 18 million Americans could face substantial increases in their share of premiums.
At the same time AHIP is pushing back on the Biden administration’s effort to extend enrollment periods by another month. According to AHIP, “ Extending the open enrollment period could disincentivize consumers from enrolling in comprehensive coverage for a full 12 months and place consumers at risk for disruptions in care.” Most people can understand both of these requests.
First, the effects of loss of these subsidies is clearly going to be an incredible burden and will bring us back to the reality of health insurance premiums and the relationship to the actual cost of care. Second, why would anyone pay premiums continually, if they knew they could simply enroll in a plan when they knew they needed something, then cancel and enroll again later?
These are both legitimate concerns. California has extended their enrollment periods multiple times. In fact it was driving us all a little crazy. My preference is to maintain Nov 1 to Dec. 15th as the open enrollment period. In my experience, regardless of the deadline, most people wait until the last minute to take action. This gives everyone a one year benefit period and it is completed before the Christmas holidays. We can concentrate on family and other priorities.
AHIP also expressed concern about returning to standardized plans. I prefer standardized plans so the consumer and agents are not exhausted by trying to find the glitch in the non-standard plans. Typically they weren’t that much different and simply confused people.
For example, a plan that offered 3 up-front office visits to a high deductible option would cost as much as $50 monthly more than the alternative. Three Primary care visits would not have cost $600.
When the ACA was passed in 2010, I committed to working to help it succeed. It has been a roller coaster ride with much of the tumult caused by the previous administration and opposition party. With the Supreme Court hopefully ending the chaos, it is time to get serious and start addressing the reality of the American health care financing and delivery systems.
American spend too much for too little. It is much like the current infrastructure bill. Spending a staggering amount of money, one would expect thousands of miles of improvements. If France can build 1 kilometer of rapid transit infrastructure for about $260 million while the US costs run closer to $900 million per kilometer, should we ask some questions about “bang for our buck”?
The cost benefit analysis shows our healthcare system needs dramatic improvement. Anthem subscribers are currently on edge as Anthem and Dignity battle out their contracts. Shasta Regional has cancelled their Anthem contract, but like Dignity will provide “continuity of care”, according to CEO Casey Fatch. Is this really how we want to proceed in the future?