Rate Increases for 2017 Medical Insurance Plans

There will be a significant rate increase for 2017 plans. The reasons given are the end of funding that was available in the first three years to offset rates, the rise in specialty medication and claims from those who enroll during Special Enrollment Periods.

In regard to the specialty medication, sometimes pharmaceutical companies are raising prices of medications when the need for a medication increases. Newer specialty medications can approach $100,000 per course of treatment and/or per year.

Below is the press release from Covered California on July 19, 2016

SACRAMENTO, Calif. — Covered California unveiled its rates for 2017 on Tuesday and announced that some health insurance plans will be expanding into new areas throughout the state to compete for consumers in California.

The statewide weighted average change will be 13.2 percent, up from approximately four percent in each of the last two years. However, most consumers will see a much smaller increase — or pay less next year — if they switch to another plan.

“Shopping is going to be more important this year than ever before,” Covered California Executive Director Peter V. Lee said. “Almost 80 percent of our consumers will either be able to pay less than they are paying now, or see their rates go up by no more than 5 percent, if they shop and buy the lowest-cost plan at their same benefit level. That’s the power of shopping.”

Lee said the opportunities to shop and save show that California has succeeded in building a competitive marketplace for health insurance, with rate increases that are still below trends in the individual market before the Affordable Care Act was passed.

“This is a new era of health care, where the consumer is in the driver’s seat with the power to look easily for a better deal, and where subsidies help absorb the impact of rate changes,” Lee said. “These options did not exist before the Affordable Care Act.”

Some consumers who choose to keep their plan will see a significant increase in their premium for 2017, while others will see a more modest increase, depending on where they live and what insurance plan they have. Consumers will begin receiving notices in October, when they will have an opportunity to review their new rates and change plans for their 2017 health coverage.

For many of those insured, the bulk of the premium increase will be absorbed by the subsidy paid by the government to help enrollees buy health insurance. Approximately 90 percent of Covered California enrollees get help to pay for their premiums. The average subsidy covers roughly 77 percent of the consumer’s monthly premium, and while premiums will rise, the subsidies will rise as well.

“Even though the average rate increase is larger this year than the last two years, the three-year average increase is 7 percent — substantially better than rate trends before the Affordable Care Act was enacted,” Lee said.

Lee said the average rate increase reflects the cost of medical care for consumers, not excessive profit.

“Under the new rules of the Affordable Care Act, insurers face strict limits on the amount of profit they can make selling health insurance,” Lee said. “So, while all plans are experiencing different cost pressures, we can be confident their rate increases are directly linked to health care costs, not administration or profit, which averaged 1.5 percent across our contracted plans.”

For consumers who get a tax credit to lower their costs — which is about 90 percent of those who sign up through Covered California — the amount they pay is impacted not only by the premium choice, but by changes in their tax credit. While the average rate increase is higher than past years, Covered California’s risk mix — the ratio of consumers who are healthy vs. sick — remains one of the best in the nation according to the Centers for Medicare and Medicaid Services (https://www.cms.gov/CCIIO/Programs-and-Initiatives/Premium-Stabilization-Programs/index.html).

Other reasons for rate increases include:
A one-year adjustment due to the end of a funding mechanism in the Affordable Care Act known as reinsurance, which was designed to moderate rate increases during the first three years when exchanges were being established. The American Academy of Actuaries estimates this will add between 4 percent and 7 percent to premiums for 2017.
Special enrollment by some consumers who may be enrolling in health insurance only after they become sick or need care, which seems to have had a significant impact on rates for two insurance plans.
The rising cost of health care, especially specialty drugs.
Pent-up demand for health care now being accessed by those who were locked out of the health care system before the Affordable Care Act was enacted.
Lee said Covered California is working to address some of these issues on multiple fronts. The exchange is aggressively marketing to attract healthy consumers year-round, and it is working to ensure special enrollment is available only to those who meet qualifying circumstances. It is also sampling the special enrollment population to better understand how to make any further improvements needed.

“We work hard to build a robust exchange that drives competition by attracting as many consumers as possible,” Lee said. “Now, consistent with the vision of the Affordable Care Act, we will redouble our efforts to make sure our consumers and potential consumers understand the importance of signing up during open enrollment and remaining covered throughout the year.”

Lee said Covered California’s 11 health insurers are competing across the state for its 1.4 million members.

“The sheer number of enrollees and their overall health means consumers in the individual market are benefiting from competition,” Lee said.

Below is the complete list of the companies selected for the 2017 exchange:
Anthem Blue Cross of California
Blue Shield of California
Chinese Community Health Plan
Health Net
Kaiser Permanente
L.A. Care Health Plan
Molina Healthcare
Oscar Health Plan of California
Sharp Health Plan
Valley Health Plan
Western Health Advantage
Rate details by pricing regions can be found in “Covered California’s Health Insurance Companies and Plan Rates for 2017,” posted online at:http://coveredca.com/news/pdfs/CoveredCA-2017-rate-booklet.pdf

The preliminary rates are subject to a 60-day public comment period and regulatory review by the California Department of Managed Health Care. In addition, the California Department of Insurance will review Health Net’s EPO.

Some insurance carriers will be increasing their coverage areas in 2017:
Oscar will be entering the market in San Francisco, Santa Clara and San Mateo counties.
Molina will expand into Orange County.
Kaiser will be available in Santa Cruz County.
With the expansion of its current carriers, almost all consumers (92.6 percent) will be able to choose from three or more carriers, and all will have at least two to select from.

In addition, more than 93 percent of hospitals in California will be available through at least one Covered California health insurance company in 2017, and 74 percent will be available in three or more plans.

Covered California also is improving its patient-centered benefit designs by increasing a consumer’s access to care by reducing the number of services that are subject to a consumer’s deductible.

Starting in 2017, consumers in Silver 70 plans will save as much as $55 on an urgent care visit and $10 on a primary care visit. In addition, consumers in Silver, Gold and Platinum plans will pay a flat copay for emergency room visits without having to satisfy a deductible, which could save them thousands of dollars.

These improvements build on features already in place that ensure most outpatient services in Silver, Gold and Platinum plans are not subject to a deductible, including primary care visits, specialist visits, lab tests, X-rays and imaging. In addition, some Enhanced Silver plans have little or no deductible and very low copays, such as $3 for an office visit. Even consumers in Covered California’s most affordable Bronze plans are allowed to see their doctor or a specialist three times before the visits are subject to the deductible.

In addition, the contract with health insurers for 2017 ensures consumers select or are provisionally assigned a primary care physician within 60 days of effectuation so they have an established source of care.

“Health care reform isn’t just about making insurance affordable, it’s about doing things to make it easier for consumers to get the right care at the right time,” Lee said.

In May, the Centers for Disease Control and Prevention announced that California’s uninsured rate had fallen to 8.1 percent at the end of 2015, down from 17 percent at the end of 2013, right before the Affordable Care Act began offering coverage.

“We can all be very proud of the extraordinary gains we have made in reducing California’s uninsured rate to a historic low,” Lee said.

About Covered California
Covered California is the state’s marketplace for the federal Patient Protection and Affordable Care Act. Covered California, in partnership with the California Department of Health Care Services, helps individuals determine whether they are eligible for premium assistance that is available on a sliding-scale basis to reduce insurance costs or whether they are eligible for low-cost or no-cost Medi-Cal. Consumers can then compare health insurance plans and choose the plan that works best for their health needs and budget. Small businesses can purchase competitively priced health insurance plans and offer their employees the ability to choose from an array of plans and may qualify for federal tax credits.

Covered California is an independent part of the state government whose job is to make the new market work for California’s consumers. It is overseen by a five-member board appointed by the Governor and the Legislature. For more information about Covered California, please visit www.CoveredCA.com.

This article is from the Los Angeles Times date July 20, 2016

California Obamacare rates to jump

Premiums are set to go up an average of 13.2% next year. Rising medical costs are one reason, officials say.

BY MELODY PETERSEN AND NOAM N. LEVEY

Premiums for Californians’ Obamacare health coverage will rise an average of 13.2% next year — more than three times the increase of the last two years and a jump that is bound to stir debate in an election year.

The big increases come after two years in which California officials had boasted that the program helped insure hundreds of thousands people in the state while keeping costs moderately in check.

Premiums in the insurance program called Covered California rose just 4% in 2016 after rising 4.2% in 2015 — the first year that exchange officials negotiated with insurers. The program insures 1.4 million Californians.

On Tuesday, officials blamed next year’s premium hikes in the program on rising costs of medical care, including expensive specialty drugs and the end of a mechanism that held down rates for the first three years of Obamacare.

Two of the state’s biggest insurers — Blue Shield of California and Anthem Inc. — asked for the biggest hikes. Blue Shield’s premiums will jump an average of more than 19%, according to officials, and Anthem’s rates will rise more than 16%.

For consumers, the effect will depend on whether they get taxpayer-supported subsidies for their premiums and whether they are willing to switch to less-expensive plans that may come with higher co-pays and deductibles. Changing plans could also mean a new network of physicians, which could be disruptive to care for those with chronic conditions.

The rates vary significantly by region and insurer. Los Angeles and the rest of southwest Los Angeles County will see an average increase of almost 14%.

Blue Shield’s preferred provider organization rate in Los Angeles, chosen by 21% of those using the exchange, is increasing by an average of 19.5%. For a 40-year-old single person making $17,820 to $23,760, choosing a silver level plan, the monthly rate currently is $122, while the government pays Blue Shield $196. Next year that same person would pay $170, while the government would chip in $211 a month.

“We’re paying more for less,” said Jamie Court, president of Consumer Watchdog in Santa Monica. “Insurers are limiting access to doctors and hospitals while also demanding a higher price.”

Horacio Chavez, 34, of Boyle Heights said he made less than $25,000 last year as an education coordinator at a youth center. He currently pays a $100 premium for a Covered California plan that he uses for an annual checkup and a safety net in case of emergencies.

“I do want healthcare — I want the peace of mind that if anything happens to me that there’s some kind of coverage,” Chavez said. But “a 13% hike … that’s going to affect people.”

He said he’s already barely making ends meet trying to pay his rent, student loans from the University of Chicago, car payments and his health insurance premium.

“I’m already living check to check,” Chavez said.

Covered California officials defended the system Tuesday, saying that the competition among insurers offering coverage on the exchange was working to keep rates lower than they otherwise would be.

“California has a very competitive marketplace,” said Peter Lee, executive director of Covered California.

Obamacare has significantly reduced the number of uninsured Californians. Since the state’s health insurance exchange began offering coverage in 2014, the share of Californians without health insurance has fallen from 17% at the end of 2013 to 8.1% at the end of last year, according to officials.

Rates are expected to jump in other states too, although complete details won’t be available until later this year.

An analysis of 14 metro areas that have already announced their 2017 premiums found an average jump of 11%. The changes ranged from a decrease of 14% in Providence, R.I., to an increase of 26% in Portland, Ore., according to the analysis by the nonpartisan Kaiser Family Foundation.

The federal healthcare-  .gov   exchange provides insurance under the Affordable Care Act in 38 states. California and a few other states operate their own exchanges.

Around the country, several insurers, including giant UnitedHealth, have stopped selling health plans on the exchanges, and a number of new nonprofit health insurance co-ops have gone out of business.

Those decisions have fueled charges from the law’s critics that Obamacare isn’t working.

Former Secretary of State Hillary Clinton, the presumptive Democratic presidential nominee, is pushing a number of specific steps to ease price pressure on consumers, including allowing Americans ages 55 to 64 to buy into Medicare.

Republican presidential nominee Donald Trump has argued the health law should be repealed.

The health law’s next enrollment period begins a week before election day.

The state and federal health insurance exchanges provide coverage to about 12 million people nationally, representing just a fraction of the nation’s total insurance market. The vast majority of Americans — more than 250 million people — are in health plans purchased through an employer or provided by a government plan such as Medicare or Medicaid.

But the exchanges are a pillar of the Affordable Care Act’s program for guaranteeing Americans’ insurance coverage. And monthly premiums have become a closely watched barometer of how the law is performing.

Covered California’s Lee told the House Ways and Means Committee on July 12 that 2017 would be “a transitional year” for Obamacare, with rates seeing “significant adjustments” across the nation.

He said one reason for the increase was the end of a program designed to keep rates down during the insurance exchange’s first three years. The program had assessed a fee on all health insurers and then redistributed those funds among carriers whose members had the highest medical expenses, Lee said.

Lee added that some insurers had also not charged enough in the first two years because they didn’t have full data on the medical costs or health status of those signing up. Now they’re adjusting to account for those higher costs.

Mia Campitelli, a Blue Shield spokeswoman, said Tuesday that the insurer’s average 19.9% premium increase was “driven by our members using more healthcare services than we expected,” as well as the phaseout of the federal mechanism that had kept rates down in the law’s early years.

Anthem spokesman Darrel Ng said: “Factors such as increased use of medical services and added costs of drugs and medical therapies put upward pressure on rates and underscore the additional work that needs to be done to moderate the growth in healthcare costs.”

The financial pain for most Californians getting insurance through the exchange will be muted because 90% get taxpayer assistance to cover the premiums.

Americans making less than four times the federal poverty level — about $47,000 for a single adult or $97,000 for a family of four — qualify for the assistance.

Nonetheless, Americans who make too much to qualify for subsidies are likely to feel the brunt of the higher premiums. That will probably increase pressure on the new president — Democrat or Republican — to review the exchanges in 2017 for ways to make health plans more affordable.

A year ago, Lee wrote an op-ed in The Times saying that Covered California’s power in negotiating with insurers was allowing Obamacare to work in the state.

“We now have the full picture in California, where we are proving that health insurance exchanges can keep prices in check,” he wrote.

Though the Affordable Care Act has improved care for millions of Americans — for example, insurance companies can no longer set lifetime limits on care or exclude anyone because of a preexisting condition — the 6-year-old law contains few controls on overall costs.

Spending on the country’s medical system averages more than $10,000 for every American, according to statistics released by the Obama administration this month, far higher than any other nation. melody.petersen

@ latimes.com   noam.levey@latimes.com   Times staff writer Soumya Karlamangla contributed to this report.

RICH PEDRONCELLI Associated Press

“CALIFORNIA has a very competitive marketplace,” said Peter Lee, executive director of Covered California. Above, Lee discusses the program last year.

Blue Shield Will Cancel All Grandfathered Plans On January 1, 2017

Your Blue Shield of California Grandfathered Individual and Family Medical Insurance Plan will no longer be available after December 31, 2016. You will be automatically enrolled in what Blue Shield considers to be an Affordable Care Act (aka Obamacare) plan that is similar to your current plan.

Starting January 1, 2017 you will qualify for a Special Enrollment Period which will allow you to switch to another company with an effective date of no later than March 1, 2017. Using the Special Enrollment Period may not necessarily be in your best interest, for example, if you use part of a Blue Shield deductible between January 1, 2017 and March 1, 2017, this amount may not carry over to another company. A similar situation may exist with the Maximum Out of Pocket limit.

We should discuss your plan change within Blue Shield or to another company during Open Enrollment which begins on November 1, 2016 for an effective date of January 1, 2017. I will be sending an e mail in the middle of October to set up phone appointments to discuss all your options.

Blue Shield will be notifying you beginning this month.

 

 

Costs top healthcare concerns

This article from the Los Angeles Times, dated June 11, 2016 indicates that the cost of healthcare is a primary concern for our country. It also indicates that there is much confusion regarding Obamacare.

In my opinion the cost of healthcare will decrease significantly when physicians understand nutrition, exercise and psychological well being and will be able to effectively communicate this to patients. Everyone must be responsible for incorporating this in their lives.

USC DORNSIFE/LOS ANGELES TIMES POLL
Costs top healthcare concerns
A poll finds state residents more worried about rising prices than access.
BY DAVID LAUTER
WASHINGTON — Six years after President Obama signed the Affordable Care Act, the health reform law has gained acceptance from a majority of California voters, but the cost of getting healthcare remains a major concern, eclipsing worries about having insurance, according to a new USC Dornsife/Los Angeles Times poll.

The widespread worry about costs indicates a potential shift in the debate over healthcare, at least in this heavily Democratic state.

Nationally, the political debate has been stuck for most of the last six years on Republican efforts to block Obamacare, but that gridlock could lessen after the election.

In both parties, lawmakers increasingly have been hearing complaints from their constituents about the cost of care, and polls have found that prescription drug prices, surprise medical bills and other pocketbook issues concern voters more than the future of the health law.

Echoing that national trend, almost two-thirds of voters in the USC/Times survey say they worry “very much” about rising health costs, with only 10% saying that is not something they worry about.

Just slightly more than half say that lack of insurance is something they worry about a lot, and roughly three in 10 say they were not worried about it.

Latinos, however, were an exception, reporting equal levels of unease about cost and having insurance — three-quarters said they were very worried about each.

Cost concerns were most widespread among those in their 50s and early 60s. Indeed, that age group consistently showed the highest levels of anxiety on a series of healthcare concerns.

By contrast, those over age 65, most of whom are covered by Medicare, were the least likely to express worry about healthcare issues.

For a significant number of voters, the healthcare law itself takes blame for rising costs. Just over half of those surveyed said they believed that costs for average Americans have “gone up a lot” because of the law, compared with roughly one-third who said that the law had not caused that to happen.

As with many aspects of the healthcare debate, partisanship plays a big role in shaping beliefs about rising costs: Republicans by overwhelming margins blame the law, while Democrats were split closely on whether it’s responsible.

Most Americans have been forced to confront increased costs for health coverage for years — a trend that began long before the passage of the reform law.

Employers have continued to shift costs to their workers, mostly in the form of higher deductibles and co-payments. Although those higher costs may not have been caused by the new law, many blame it.

The law clearly has raised costs for one relatively small slice of Americans — mostly healthy, self-employed people with middle-class or higher incomes who were previously able to buy low-cost policies on the private market.

The new law requires those people to buy more comprehensive policies, which provide greater coverage, but at a higher price. Covering sicker customers who used to be denied insurance has also led insurers to raise some premiums.

Low- and middle-income Americans get subsidies under the law that lower their monthly premiums, but higher-income Americans do not.

More than three-quarters of California voters acknowledge the biggest effect the law has had — reducing the number of Americans who lack health coverage. By 77% to 15%, voters said that the law had achieved that goal.

Since the new law’s coverage expansion began in 2014, some 20 million previously uninsured Americans have gained coverage, and the share of American adults under age 65 who are uninsured has dropped from one in five to about one in eight, according to numerous private and government surveys.

But on that point, too, partisanship colors perceptions. Among Republicans, 28% in the current survey said that the new law had not led to more people having insurance. Among Republicans who identify with the tea party, 48% took that view, compared with 31% who said the law had reduced the number of uninsured.

The public’s view remains split on another of the law’s major accomplishments, as well — ending the ability of insurers to deny health coverage because of preexisting health conditions. The poll found 59% of voters saying that coverage could no longer be denied, while 21% said that had not happened.

On that question, the division did not appear primarily partisan. Instead, some of the groups whom the new law was designed to help most appeared least aware of one of its central elements.

Latinos, those younger than 30 and people with incomes under $30,000 were all less aware of the change regarding preexisting health conditions than whites and those who were older or more affluent. Among Latinos, for example, though 48% said the law had accomplished that goal, 30% said it had not.

That lack of awareness of one of the law’s main achievements marks a “messaging failure” by the law’s supporters, said Anna Greenberg, the Democratic pollster whose firm forms half of the bipartisan team that produced the survey for USC and The Times.

The White House and its allies have struggled at times to convey a message about the law, in part because for many Americans, it remains an abstraction.

Just over half of those surveyed said the law had no effect on themselves or their families. That’s by design: The law was written to cover the uninsured while minimizing the effect on people who get coverage through their jobs, as most working-age Americans do.

That has cost Obama politically. The views that most Americans have of the law have been shaped less by direct experience than by partisanship, according to Drew Altman, the president of the Kaiser Family Foundation, which has carefully tracked opinion about the health law.

Only about four in 10 of those who supported the law in the poll also said it had made their own families’ healthcare better.

Overall, 53% of the state’s voters favor the law, with 31% favoring it strongly. An additional 12% said they opposed it because it did not go far enough, while 27% said they opposed it because it went too far.

Those who said the law did not go far enough do not consistently back liberal views on how to replace it.

Only 40%, for example, supported a single-payer system — the sort of healthcare solution advocated by Sen. Bernie Sanders in his campaign for president.

By contrast, those who support the law backed the single-payer idea 69% to10%. Overall, just over half of the state’s voters supported it, with about one-quarter opposed.

The state’s voters divided evenly on the question of whether to repeal the law’s requirement that people have insurance.

Opinion on that question split along predictable partisan lines with one significant exception — Latinos, who generally back the law, also supported repeal of the mandate, by 57%-37%.

Most California voters have a positive view of their own healthcare and a somewhat positive view of healthcare in the state, the poll found. Seven in 10 rated their own healthcare as “excellent” or “good” while just under three in 10 called their care “fair” or “poor.”

Ratings were highest among those earning more than $100,000 a year and among those aged 65 and older, which reflects the generally positive view that Americans have of Medicare.

Asked about the state of healthcare in California, 44% called it excellent or good, while 34% said fair and 14% poor.

Ratings were gloomier about healthcare nationwide, with only 30% calling it either excellent or good, 39% fair and 25% poor.

The poll for the USC Dornsife College of Letters, Arts and Sciences and the Los Angeles Times was conducted jointly by the Democratic firm Greenberg Quinlan Rosner Research and the Republican firm American Viewpoint. It questioned 1,500 registered California voters from May 19-31. The margin of sampling error is 2.9 points in either direction for the full sample. david.lauter

@ latimes.com  .
DAVID BUTOW For The Times

 

Eliminating Confusing Health Plans

It has been my experience as an insurance broker that some insurance companies have far too many plan designs which are very confusing for the consumer. Hopefully changes will be adopted to make the process of choosing a plan more consumer friendly.
Below is a partial excerpt from Covered California’s Daily News, dated March 9, 2016 which discusses the issue.
________________________________________
New Analysis Urges Shift to Patient-Centered Benefit Designs to Cut Costs and Help Consumers Get Care
Posted: 09 Mar 2016 02:52 PM PST
Lessons Learned in California Can Help Avert a Collision Between Conflicting Reform Initiatives

SACRAMENTO, Calif. — A new analysis urges state-based marketplaces, the employer-sponsored insurance market and health insurance plans to take action and move toward plan benefit designs that put consumers first, and remove existing barriers to getting needed health care.
In an article written in the New England Journal of Medicine by Dr. Elliott Fisher, Director of The Dartmouth Institute for Health Policy and Clinical Practice, and Covered California Executive Director Peter V. Lee, both stress the importance of patient-centered benefit designs to reach the next level of health care reform.

“Health plans, states and employers should take to heart the lesson that offering a lot of different designs does not serve consumers well,” Fisher said. “Too many health plans, in exchanges and the employer sector, offer confusing benefit designs with out-of-pocket costs that prevent people from seeing their doctor.”

Lee said Covered California has a model that has worked for its consumers since the agency opened its doors in 2014.

“Covered California has led the way in the fight for consumers by shaping benefit designs that help consumers make apples-to-apples comparisons and to get the health care they need,” Lee said. “A good patient-centered benefit design is critical to making sure consumers get the right care at the right time.”

Fisher and Lee noted that the current health care system seeks to improve care and cut costs through provider-focused and consumer-focused reform initiatives that directly conflict with one another.
For example, provider-focused initiatives encourage physicians, hospitals and other providers to coordinate and improve care to lower costs. However, the consumer-focused approach discourages people from seeing their provider because of increased cost-sharing.

Studies show the proportion of Americans with employer-sponsored coverage involving deductibles of more than $1,000 has increased from 10 percent to 46 percent since 2006, with many plans requiring people to fully meet their deductible before receiving any coverage for primary care. A 2015 National Bureau of Economic Research study showed the adoption of a high-deductible health plan in a relatively high-income population led to a 10 percent reduction in the use of preventative services and an 18 percent drop in physician visits, with the greatest reductions occurring in the sickest patients.

“We want consumers to be able to see their doctor when necessary, so their health care needs can be met in the most effective and efficient way possible,” Fisher said.

The authors cite California’s approach as an example of how it might be possible to avoid this collision between provider- and consumer-focused efforts. Covered California, the state’s insurance exchange, requires plans to adopt patient-centered benefit designs that allow consumers at every metal tier (cost-sharing split between insurer and enrollee) to visit their primary care physician without the cost being subject to a deductible. “When a consumer is able to get the right care at the right time, it cuts down health care costs for everyone,” Lee said.

The Centers for Medicare and Medicaid Services recently announced it would allow health insurance companies to offer patient-centered benefit designs on the federal exchange.
“This is a good step for consumers,” Lee said. “However, more needs to be done if we are going to reach the next level in health care reform.”

The article, “Toward Lower Costs and Better Care – Averting a Collision between Consumer- and Provider-Focused Reforms,” is available atwww.nejm.org/doi/full/10.1056/NEJMp1514921.

About The Dartmouth Institute
Since 1988, The Dartmouth Institute for Health Policy and Clinical Practice has been working to find solutions to some of the most challenging problems in health care delivery. Our goal is to help create an affordable, high-performing health system for everyone.

About Covered California
Covered California is the state’s marketplace for the federal Patient Protection and Affordable Care Act. Covered California, in partnership with the California Department of Health Care Services, was charged with creating a new health insurance marketplace in which individuals and small businesses can get access to affordable health insurance plans. Covered California helps individuals determine whether they are eligible for premium assistance that is available on a sliding-scale basis to reduce insurance costs or whether they are eligible for low-cost or no-cost Medi-Cal. Consumers can then compare health insurance plans and choose the plan that works best for their health needs and budget. Small businesses can purchase competitively priced health insurance plans and offer their employees the ability to choose from an array of plans and may qualify for federal tax credits.

Covered California is an independent part of the state government whose job is to make the new market work for California’s consumers. It is overseen by a five-member board appointed by the governor and the Legislature.

Insurance premiums spark new front in Obamacare war

In this the second year of implementation of the Affordable Care Act, premiums have not stabilized but it is probably an unreasonable expectation of the giant upheaval in a the health insurance system. The coming years will be the litmus test, hopefully the trend of large rate increases will turn around.

Below is an article from the Washington Examiner, date July 6, 2015.

Republicans target big increases as evidence that healthcare law isn’t working

Insurance premiums have quickly become a new front in the Obamacare fight, with opponents pouncing on big increases and supporters and experts countering the increases won’t be so bad.

The fight started last month when insurers were required to disclose estimated 2016 rates of 10 percent or more for Obamacare customers. Some figures grabbed headlines, especially with certain insurers calling for 50 to 70 percent increases.

The premium spikes vary by state and insurer. For instance, some plans in Florida are actually proposing reduced premiums, but 13 plans want rate increases of 10 percent or more, including Time Insurance Co.’s 63 percent hike.

Republicans say the higher rates are evidence that the law is hurting Americans and not lowering healthcare costs.

“The whole point of Obamacare was to make health care more affordable. But premiums aren’t going down; they’re going up — way up,” said Rep. Paul Ryan, R-Wis., chairman of the House Ways and Means Committee, in a recent hearing.

“The model we’re on in the Affordable Care Act is not sustainable,” said Rep. Mike Kelly, R-Pa., at the same hearing.

This is the first time since Obamacare’s passage that insurers can look at a full year’s worth of claims data and calculate premiums, Rep. Pete Roskam, R-Ill., said at the hearing. He added that the premium spikes are not growing pains.

“The law created a number of temporary programs to pay out billions in taxpayer funds during the first few years to lower costs seen by individuals and to protect big insurance companies against financial losses,” he said. “But those programs are beginning to phase out, and as the government is slowly taking off the training wheels, Obamacare is looking pretty wobbly.”

Supporters counter that any increases aren’t finalized and will have a modest impact overall.

“We have just the bad news,” said Kathy Hempstead, who directs coverage issues for the Robert Wood Johnson Foundation.

One analysis found that Obamacare customers as a whole may only see a modest increase.

The research firm Avalere looked at proposed rate filings in seven states and the District of Columbia. The average premiums for silver plans, the second cheapest option and a popular choice for Obamacare enrollees, will increase nearly 6 percent, Avalere said.

Avalere also noted that the low-cost silver plan options are likely to be smaller than the silver plan as a whole. Premiums for the lowest- and second-lowest silver plans in the seven states and D.C. will increase on average 4.5 percent and 1 percent.

A separate analysis from the nonpartisan Kaiser Family Foundation found that in 11 major cities the cost of a regular silver plan would be on average 4.4 percent higher in 2016 than this year.

Premiums must be finalized by October. That way customers facing a high premium can choose a different plan during the next open enrollment this fall.

Another reason why the rates could change is states need to conduct reviews themselves.

Obamacare requires states to report on any premium increase trends and recommend whether certain plans should be excluded from the exchanges, according to the National Conference on State Legislatures.

In 2011, the federal government started to work with states to strengthen or alter their rate review programs. If a state doesn’t have the resources to conduct the required review, the Department of Health and Human Services will do it, the National Conference on State Legislatures said.

“The carriers really have to be able to explain their rates, and that is part of the point of the whole medical loss-ratio regulations,” Hempstead said.

The medical loss ratio is another new regulation installed under Obamacare. It requires insurers to devote 85 percent of the cost of a premium on medical care and the other 15 percent on administrative costs.

The ratio ensures that insurers don’t devote too much of their costs to overhead.

Amid the rhetoric over the premium increases are certain trends that could affect the insurance market as a whole.

Many Blue Cross Blue Shield insurers kept premiums in marketplaces comparatively low with small increases from year to year, but that varies considerably across the country, according to a study of trends for market place plans done by the foundation and the left-leaning think tank Urban Institute.

The report looked at the cheapest silver plans in 30 states. Some insurance companies were reluctant to enter the Obamacare marketplaces in 2014 and when they did the plans were more expensive.

However, the report projects insurers will lower premiums to keep prices low to attract enough customers buying insurance through the Obamacare marketplaces.

But for opponents of Obamacare, the proposed increases represent a long-standing criticism about the law’s ability to battle healthcare costs, which was levied even before the exchanges opened in 2014.

Cigna Completes Acquisition of Sterling Life

An announcement from Cigna dated July 1, 2015  follows.

Cigna recently completed its acquisition of Sterling Life Insurance Company (“Sterling”). Based in Bellingham, WA, Sterling primarily offers Medicare Supplement policies to individuals. We will integrate Sterling within Cigna’s U.S. Individual segment and currently plan to migrate business processing to our Austin, TX, facility, which services our existing individual Medicare Supplement business. We are working directly with Sterling’s management on the transition, which we expect to take about 12 to 18 months.

Roberts again shows independent streak

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This article from the Los Angeles Times dated June 26, 2015 is a follow up to the Supreme Court decision to uphold the Affordable Care Act.

WASHINGTON — Since becoming chief justice 10 years ago, John G. Roberts Jr. has been determined to show that the court he leads is made up of impartial jurists, not politicians in robes.   In the phrase he used at his confirmation hearings, each justice is “like an umpire” at a baseball game — not favoring one team over the other.   On Thursday, Roberts showed again his willingness to brush aside partisan politics and forge a middle ground on some of nation’s most divisive issues, writing a 6-3 decision that upheld the broad reach of President Obama’s healthcare law.   It was the second time in three years that Roberts had led the Supreme Court to uphold the Affordable Care Act, also known as Obama-care. The decision surprised and disappointed some of the conservatives who had once hailed his appointment.   “We might as well call the law … RobertsCare,” said Ilya Shapiro, a lawyer at the Cato Institute, a libertarian think tank in Washington.   When Roberts spoke of being an umpire, “a lot of people on the left sneered,” said Neal Katyal, who served as acting U.S. solicitor general in Obama’s first term. “Today’s decision shows he really meant what he said. It’s a profound statement about the difference between law and politics.”   Roberts cringes at the regular references to the “conservative bloc” or the “liberal wing” of the court. Last year, he was pleased when the justices were able to agree unanimously in a much higher percentage of their cases.   Thursday’s decision sent a particularly loud message about a nonpartisan court because the chief justice gave a generous reading to a liberal law passed by a Democratic-controlled Congress.   But the decision is not a sign that Roberts has become a liberal or shifted strongly to the left, as some allege.   On the same day, Roberts joined three conservatives in dissent when the majority held that the Fair Housing Act forbids practices that have a “discriminatory effect” on racial minorities even if there is no intentional discrimination. In 2013, he voted with conservatives to strike down part of the Voting Rights Act.   His decisions on easing campaign finance rules, including Citizens United, which gave corporations and unions the ability to make unlimited contributions to political causes, firmly established Roberts’ record as a conservative.   But on most issues, the chief justice has shown himself to be most comfortable in the moderate middle and unwilling to push the law too far to the right or too quickly.   In April, he joined with the court’s four liberal justices to uphold a Florida law that prohibited elected judges from personally soliciting campaign contributions. Roberts supports the 1st Amendment right to spend freely on campaigns, but judges are not politicians, he said.   In other alliances with liberals, he helped forge a 6-3 majority to rule that a police officer may not detain a car stopped for a traffic violation so a drug-sniffing dog may be brought to the scene. He also joined a 5-4 opinion by Justice Ruth Bader Ginsburg that freed a Florida fisherman from federal obstruction-of-justice charges for having tossed overboard several undersized red grouper.   Further evidence on how Roberts sees his role could come as early as Friday in the court’s decision on gay marriage. It’s widely expected that a majority of justices will declare the right of gays and lesbians to marry nationwide, but given Roberts’ growing independent streak, combined with the impact that case will undoubtedly have on his legacy, some are wondering whether the chief justice will find a way to side with liberals in what would be a landmark decision.   Roberts’ reasoning in the healthcare case showed several of his characteristic traits — a desire for moderation as well as a concern over the real-world impact of the court’s decisions, particularly on business.   Had the justices ruled for the conservative activists who sued the administration, more than 6.4 million people could have lost their health coverage. That in turn could “well push a state’s individual insurance market into a death spiral,” Roberts said.   It would be “implausible,” he said, to think the Congress that passed the healthcare law intended to limit its tax subsidies to the 13 states that established an exchange, or marketplace, of their own.   He rejected the claim brought by conservative activists who pointed to one part of the law that said subsidies were limited to insurance policies bought on an exchange “established by the state.” This hyper-technical reading of one phrase did not make sense and was contradicted by other parts of the law, he said.   “Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them,” he wrote.   Duke Law professor Neil Siegel called the majority opinion “a masterpiece of legal craft, good sense and fidelity to the law at a time when political polarization threatens to spill over into the judiciary.”   But the three conservative dissenters accused the majority of “interpretive jiggery-pokery” and “somersaults of statutory interpretation” to fix a political, not legal, problem.   “This court’s two decisions on the [healthcare] act will surely be remembered through the years,” wrote Justice Antonin Scalia, joined by Justices Clarence Thomas and Samuel A. Alito Jr. “And the cases will publish forever the discouraging truth that the Supreme Court of the United States favors some laws over others, and is prepared to do whatever it takes to uphold and assist its favorites.”   In most cases, Roberts is still more likely to vote with the court’s conservatives. University of Chicago Law professor David Strauss said the final word about the Roberts court wouldn’t come until it weighs in on broad major issues like abortion and race.   “But the chief justice has made it clear that he meant what he said in his confirmation hearings: The big decisions should be made by the people who won an election, whether the court agrees with them or not, as long the justices don’t have to distort the law to do that,” Strauss said. david.savage@latimes.com

Getty Images   CHIEF JUSTICE reenforced his statement that each justice is “like an umpire.”

WIN MCNAMEE Associated Press   JOHN G. ROBERTS JR. says he dislikes the references to the “conservative bloc” or the “liberal wing” of the U.S. Supreme Court, which he’s led for a decade.

Cancellation of Individual and Family Medical Policies For Non Payment of Premium

Insurance Companies no longer reinstate individual and family plans for non payment of premium.

Individual and family plans can only be purchased during open enrollment which is closed until November2015.

Individuals and families who qualify for a Special Enrollment Period can purchase plans. Non payment of premium is not a qualification for a Special Enrollment Period.

The Internal Revenue Service will impose a penalty if you do not have a medical insurance plan that may amount to thousands of dollars.

Please pay your premiums when your bill is received.

If you have not paid your premium by this time of the month, I would strongly encourage you to call the membership services number on your ID card and pay the bill. A late or lost check may result in a cancellation for non payment.

Open Enrollment for 2015 Individual Health Plans

If you would like to review your plan options for 2015 we need to set up a phone appointment during Open Enrollment. Open Enrollment begins November 15th and will continue until December 15th for a January 1, 2015 effective date. Open Enrollment will close on February 15, 2015 with the last effective date being March 1, 2015. Individual health insurance policies cannot be purchased beyond March 1, 2015 unless one qualifies for a Special Enrollment Period.

If you would like to set up a phone appointment please let me know. Here is what I will need before setting the appointment;

If you think you are eligible for a subsidy, send me your ESTIMATED 2015 MODIFIED ADJUSTED GROSS INCOME (MAGI). Your tax consultant should be able to help you determine the amount.

If you know you do not qualify for a subsidy or are not interested please let me know.

I will send you several options of dates and times for an appointment once I have this information. Please understand that appointments book very quickly so I encourage you to respond as soon as possible.

Health Insurance Review

If you would like to review your health insurance policy moving forward into 2104 please send me an e mail with various dates and times beginning 12/9 that you would be available for a phone appointment.

Thanks,

Dennis David

Certified Covered California Agent # 2000001789

Please take a moment and click the URL to view my website dennisdavidhealthplans.com. It helps my business grow!

 

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Dennis David
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Voice 310 836 9893
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