Tag Archives: Health Insurance Premiums

COVERED CALIFORNIA HEALTH PLANS EXTEND PAYMENT DEADLINE TO JANUARY 15, 2014

coveredcaConsumers Given Nine Additional Days to Make Payment; Coverage Still Effective Starting Jan. 1, 2014

SACRAMENTO, Calif. — Covered California’s eleven health insurance companies unanimously agreed Saturday to extend the deadline for consumers to submit payment for their first month’s premium.

Consumers now have until Jan. 15, 2014 to make payment to the companies. The nine additional days will ease feelings consumers may have of being rushed to pay the invoices they recently received.

The extension also assures health insurance companies time to mail the invoices and for consumers to have received the documents. Payment for coverage taking effect Jan. 1 must be in the hands of the health insurance companies by Jan. 15 and not simply postmarked or in-transit.

Meanwhile, about 200,000 households with coverage due to take effect Jan. 1, and who supplied their email addresses to Covered California, will receive direct notification about the payment deadline extension. Consumers can also visit www.CoveredCA.com  for instructions on how to pay their premium.

Health insurance companies stress that this is a one-time payment deadline extension, and that payment for coverage is due at the beginning of each month.

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. With coverage starting in 2014, 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. For more information on Covered California, please visit www.CoveredCA.com.

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Some health insurance gets pricier as Obamacare rolls out latimes.com

Jennifer Harris needs a new health insurance plan

Thousands of Californians are discovering what Obamacare will cost them — and many don’t like what they see.

These middle-class consumers are staring at hefty increases on their insurance bills as the overhaul remakes the healthcare market. Their rates are rising in large part to help offset the higher costs of covering sicker, poorer people who have been shut out of the system for years.

Although recent criticism of the healthcare law has focused on website glitches and early enrollment snags, experts say sharp price increases for individual policies have the greatest potential to erode public support for President Obama‘s signature legislation.

PHOTOS: The battle over Obamacare

“This is when the actual sticker shock comes into play for people,” said Gerald Kominski, director of the UCLA Center for Health Policy Research. “There are winners and losers under the Affordable Care Act.”

Fullerton resident Jennifer Harris thought she had a great deal, paying $98 a month for an individual plan through Health Net Inc. She got a rude surprise this month when the company said it would cancel her policy at the end of this year. Her current plan does not conform with the new federal rules, which require more generous levels of coverage.

Now Harris, a self-employed lawyer, must shop for replacement insurance. The cheapest plan she has found will cost her $238 a month. She and her husband don’t qualify for federal premium subsidies because they earn too much money, about $80,000 a year combined.

“It doesn’t seem right to make the middle class pay so much more in order to give health insurance to everybody else,” said Harris, who is three months pregnant. “This increase is simply not affordable.”

On balance, many Americans will benefit from the healthcare expansion. They are guaranteed coverage regardless of their medical history. And lower-income families will gain access to comprehensive coverage at little or no cost.

The federal government picks up much of the tab through an expansion of Medicaid and subsidies to people earning up to four times the federal poverty level. That’s up to $46,000 for an individual or $94,000 for a family of four.

But middle-income consumers face an estimated 30% rate increase, on average, in California due to several factors tied to the healthcare law.

Some may elect to go without coverage if they feel prices are too high. Penalties for opting out are very small initially. Defections could cause rates to skyrocket if a diverse mix of people don’t sign up for health insurance.

Pam Kehaly, president of Anthem Blue Cross in California, said she received a recent letter from a young woman complaining about a 50% rate hike related to the healthcare law.

“She said, ‘I was all for Obamacare until I found out I was paying for it,'” Kehaly said.

Nearly 2 million Californians have individual insurance, and several hundred thousand of them are losing their health plans in a matter of weeks.

Blue Shield of California sent termination letters to 119,000 customers last month whose plans don’t meet the new federal requirements. About two-thirds of those people will experience a rate increase from switching to a new health plan, according to the company.

HMO giant Kaiser Permanente is canceling coverage for about half of its individual customers, or 160,000 people, and offering to automatically enroll them in the most comparable health plan available.

The 16 million Californians who get health insurance through their employers aren’t affected. Neither are individuals who have “grandfathered” policies bought before March 2010, when the healthcare law was enacted. It’s estimated that about half of policyholders in the individual market have those older plans.

Obamacare: News and analysis

All these cancellations were prompted by a requirement from Covered California, the state’s new insurance exchange. The state didn’t want to give insurance companies the opportunity to hold on to the healthiest patients for up to a year, keeping them out of the larger risk pool that will influence future rates.

Peter Lee, executive director of Covered California, said the state and insurers agreed that clearing the decks by Jan. 1 was best for consumers in the long run despite the initial disruption. Lee has heard the complaints — even from his sister-in-law, who recently groused about her 50% rate increase.

“People could have kept their cheaper, bad coverage, and those people wouldn’t have been part of the common risk pool,” Lee said. “We are better off all being in this together. We are transforming the individual market and making it better.”

Lee said consumers need to consider all their options. They don’t have to stick with their current company, and higher premiums are only part of the cost equation. Lee said some of these rate hikes will be partially offset by smaller deductibles and lower limits on out-of-pocket medical expenses in the new plans.

Still, many are frustrated at being forced to give up the plans they have now. They frequently cite assurances given by Obama that Americans could hold on to their health insurance despite the massive overhaul.

“All we’ve been hearing the last three years is if you like your policy you can keep it,” said Deborah Cavallaro, a real estate agent in Westchester. “I’m infuriated because I was lied to.”

Supporters of the healthcare law say Obama was referring to people who are insured through their employers or through government programs such as Medicare. Still, they acknowledge the confusion and anger from individual policyholders who are being forced to change.

Cavallaro received her cancellation notice from Anthem Blue Cross this month. The company said a comparable Bronze plan would cost her 65% more, or $484 a month. She doubts she’ll qualify for much in premium subsidies, if any. Regardless, she resents losing the ability to pick and choose the benefits she wants to pay for.

“I just won’t have health insurance because I can’t pay this increase,” she said.

Most Americans are required to have health coverage starting next year or pay a fine of $95 per adult or 1% of their income, whichever is greater. The fines increase over time.

A number of factors are driving up rates. In a report this year, consultants hired by the state said the influx of sicker patients as a result of guaranteed coverage was the biggest single reason for higher premiums. Bob Cosway, a principal and consulting actuary at Milliman Inc. in San Diego, estimated that the average individual premium in 2014 will rise 27% because of that difference alone.

Individual policies must also cover a higher percentage of overall medical costs and include 10 “essential health benefits,” such as prescription drugs and mental health services. The aim is to fill gaps in coverage and provide consumers more peace of mind. But those expanded benefits have to be paid for with higher premiums.

The federal law also adjusts how rates are set by age, a change that gives older consumers a break and shifts more costs to younger people. Rates by age can vary by only 3 to 1 starting next year as opposed to 6 to 1 in some cases now in California. People in their 20s just starting their careers may earn so little they qualify for subsidies. But that might not be the case for consumers who are slightly older and earning more.

“It has the effect of benefiting people in their 50s and 60s and shifting costs to people in their 20s and 30s,” said Patrick Johnston, president of the California Assn. of Health Plans. “Benefits are being increased for all, but it’s not government subsidies for all. Some will pay more.”

Rates would be going up regardless of changes from the healthcare expansion. The average individual premium will climb 9% next year because of rising healthcare costs and increases in medical provider reimbursement, according to Milliman’s estimates.

Some consumer groups have questioned whether insurers are inflating their rates under the guise of the healthcare law changes.

“We believe the prices are higher than they should be,” said Jamie Court, president of Consumer Watchdog, a Santa Monica advocacy group. “This is giving a bad name to the Affordable Care Act.”

State regulators checked the insurance companies’ math and underlying cost projections for next year, but they don’t have the authority to deny increases. Under federal rules, insurers can be ordered to issue rebates if they don’t spend a minimum amount of every premium dollar on customers’ medical care.

“The rates aren’t going up because insurance companies are pocketing more money,” Lee said. “That is what it takes to pay the claims and deliver the healthcare.”

Javier Lopez, 38 and a self-employed aerospace engineer in Huntington Beach, pays about $750 a month for an Anthem Blue Cross plan for his family of four. His premiums may rise nearly 20% next year for a new policy because his current plan is being phased out.

Lopez says he’s willing to absorb that one-year jump if it means the government can rein in future rate hikes.

“I’m hoping with this reform,” Lopez said, “we won’t see big increases year after year.”

chad.terhune@latimes.com

Twitter: @chadterhune

Some health insurance gets pricier as Obamacare rolls out – Page 2 – latimes.com.


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Covered California giving agents lip service – Articles – Employee Benefit Adviser

Some California agents are not happy with the way the state-run health care exchanges are treating them and there are many more road bumps to cross in the near future, said a San Diego-area broker.

Speaking at America’s Health Insurance Plans 2013 State Issues Conference in Arlington, Va., Bill Hammett IV, president at Hammett Health Insurance Services, said that in the buildup to Oct. 1, California exchange officials relied on brokers heavily and told them they would be an invaluable resource. However, as the exchange has rolled out, “that has not been the case. … The exchanges are only giving us lip service,” Hammett said.

In the most populous state in the nation, California’s agent population represents millions of people between employer clients and their employees, Hammett, past-president of the San Diego chapter of the National Association of Health Underwriters, explained.

While there are more than 17,000 licensed insurance agents in the state, as of last week, only 1,200 have been registered to sell in the health exchange. Yet, Hammett said 5,400 community organizers and unions have been licensed to sell on the exchange. “We [agents] are a little upset,” he added. “There is growing unrest in the agent population with the exchanges.”

With another 5,000 union and community organizers still to be licensed and just 3,000 more agents, those who traditionally were the main source of health insurance will be outnumbered five-to-one, Hammett said. “We are concerned about that, the exchanges living up to their word” to use our services, he said.

In a release, MD Sam Smith, president of the California Association of Health Underwriters said that the group’s leadership has been in constant contact with Covered California and addressed a number of issues found to be holding up the certification process.

Smith further stated the Covered California is “rapidly working through the backlog of agents waiting for formal notice of certification and the uploading of their certified agent status.” Covered California projects that the current backlog will be clear by Tuesday, Oct. 22.

Hammett also believes the exchanges have been misleading about how many employers will drop coverage. Of his 200 employer block, many of them are talking about cutting employees hours to 29 hours a week in order not to be required to provide health insurance coverage, he said. One of his restaurant clients worked with Hammett to determine all 11 of the chain’s eateries could afford only three full-time employees each, and plan to move the other employees to under 29 hours a week.

Further, Hammett said he expects more bumps in the road as the true reach, or lack thereof, of the insurance offered through the exchanges becomes known to consumers. For example, doctor networks, he said, have been kept under wraps on the exchanges. Talking with his insurer friends, he believes they will be “uber skinny” and some major hospital providers are just not going to be in the networks.

13 Comments

Posted by: Phil L | October 21, 2013 4:56 PM

I have no doubt that the Exchange disaster is not a cause of concern for single payer activists because they would be happy to have Obamacare fail so that they can point to the failures of the supposed market-based system, and replace it with Single Payer. The sole purpose of the Exchanges, which duplicate an already efficient and robust broker distribution network, is as a vehicle for them to impose Single Payer. This is already apparent in the design of the coveredca.com website which looks like it was designed by single payer activists without any input from insurance agents. Agents are barely mentioned in the website, and hard to find. The photo above the link to find agents show 4 youthful individuals with mickey mouse looking headsets on top of their heads. They look more like toll free number clerical operators than licensed insurance agents and employee benefit consultants. Whereas the photo above the Certified Enrollment Counselor link shows 4 corporate-looking business people. I don’t know what CEC’s are supposed to look like, but I have been to Healthy Families certification meetings. They don’t look anything like what’s in the covered ca photo. They would look out of place in a corporate conference room.

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Posted by: Phil L | October 21, 2013 4:48 PM

The coveredca.com website is designed to try to downplay or hide the true cost or premium for the plans that people are enrolling into. They try to only show what the cost is after deducting the subsidy that one qualifies for. There are two reasons I can think of why the Administration would want to do this: 1) They don’t want the American taxpayer to know just how monstrous the amount of money is that they will be paying to subsidize everyone, 2) They don’t want you the buyer to know how expensive it would be when you either lose your subsidy or when the Govt. stops funding the subsidies.

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Posted by: Phil L | October 21, 2013 4:37 PM

On Oct.1, after finally completing every possible requirement they asked of me over a 2 month period (i.e. application, classroom, online modules, exam, documents and fee payment) it took the Covered California Exchange another 17 more days to certify me. During these 17 days I called multiple times, endured hour-long phone holds, writing multiple emails and contacting all the Exchange officials I could find, before I was finally certified. And that only happened after I resent to them documents that they had lost for 17 days. Even with the agent certification, I am unable to advise clients because we don’t have access to either the provider networks nor to off-exchange plans. I would be doing a disservice to my clients and a possible liability to me if I were to help them enroll into a plan where they have to go out of network to see their doctors. Moreover, it would be an omission on my part to tell them to enroll into an Exchange plan without having seen what other off-exchange plans are available in the marketplace.

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Posted by: Michael L | October 21, 2013 4:00 PM

Sam and Bill are doing the right thing by holding the exchange accountable to explain how and when the rest of the agents can get certified. I am extremely proud to have worked at Covered CA over the past year to help get thousands of CA agents ready for the new marketplace. Since I left, they have continued to host agent webinars and launched the agent training and website. We’ll see if the backlog is cleared by Oct 22nd. The exchange (and your customers) need agents to be successful!

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Posted by: Jerry T | October 21, 2013 3:35 PM

Not to sound abrasive folks, but, do not be naive. ACA 2010 has as one objective to run insurance agents out of the health care industry. Salesmen are not required in a one payer system. Were there salesmen for Medicare when it was introduced in 1965? Navigator is just a synonym for bureaucrat/gov’t employee and union member paying dues to ultimately be funneled into Congressional coffers at election time. What is our commission on an individual product sale? E.G. say, it is 20% 1st year on $5000 annual premium. That is $1,000 per case. Insurance companies were promised they would be “relieved” of that commission burden if they would support ACA. How? No agents, no commission, to say nothing of their ad campaigns.Gov’t would benefit by increased tax revenue on the insurance companies by this marginal difference in expenses. One payer system makes all of that happen and more. Insurance Companies are supposed to land a windfall through ACA. No? Have you observed the insurance companies’ stock prices since, oh, say, 2010? How much did the insurance industry fight ACA?Those uncertified CA agents appear to me to be the guys and gals who elected to change careers; sell something else other than health insurance.The only reason groups are exempted from the Oct 1 mandate is because the gov’t was concerned its website could not handle the volume. The individual mandate has crashed its systems all by itself. Just wait until groups fall into the mandate. Whatever your group insurance commission income is, blow it a kiss in 2014/15, assuming gov’t websites get fixed. Just sayin’.

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Posted by: mikebraun1 | October 21, 2013 2:20 PM

I am not surprised. In Ca the end goal is to fill the coffers of political appointees and grassroots community organizations. There was a ton of money turned into Acorn and the like.

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Posted by: Michael L | October 21, 2013 2:12 PM

Sam and Bill are doing the right thing by holding the exchange accountable to explain how and when the rest of the agents can get certified. I am extremely proud to have worked at Covered CA over the past year to help get thousands of CA agents ready for the new marketplace. Since I left, they have continued to host agent webinars and launched the agent training and website. We’ll see if the backlog is cleared by Oct 22nd. The exchange (and your customers) need agents to be successful!

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Posted by: Paul W | October 21, 2013 1:50 PM

Is really true that unions and community organizers are selling insurance on the exchange without insurance agent licensed? If anyone thoughts this change would go over smoothly, they need to have their head examine. Typical of we Americans, we will bitch about anything that don’t happen instantaneously and when it does, then we will bitch about it happening to fast.

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Posted by: Dean B | October 21, 2013 1:49 PM

Things are certainly not even that good on the Federally Facilitated Exchange. The certification process was stopped dead in it’s tracks n Oct 1, and has yet to come back on line. But, if you want a true idea of who the administration wants actually selling insurance, take a look at the training and materials provided through the Navigator certification as opposed to what is provided to agents/brokers. They are actually told how the Exchange looks, and given detailed instructions on how to use it, field by field, and where to go for assistance and answers. Their resources are far superior to ours. Make NO mistake–the Obama administration does not want us selling Obamacare.

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Posted by: Wes B | October 21, 2013 1:47 PM

We shouldn’t forget about the Medicare drug expansion that occurred about a decade ago. You would have thought the world was coming to an end with the level of animosity that was generated because of growing pains and the learning curve. But people got through it and now don’t think much about it. Are people really that much more impatient and vile-tempered now? This will pass also, if people can calm down a bit.

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Posted by: Diane | October 21, 2013 1:16 PM

Technical glitches “be darned” the true nightmare is this is not “affordable” nor does it provide “care” as in “access to care”. The plan was to run agents & brokers out! If OOP & deductibles are still high, many are still not receiving health care. What health insurance problem did this solve besides pre-existing & 20 somethings riding parental coat tails??

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Posted by: Joy P | October 21, 2013 1:00 PM

Absolute nightmare! From taking an hour to contact them for information to ease of use for our web portal to faxing applications to a fax machine that rarely answers. Should have been turned over if we have to have this exchange to the private industry to run.

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Posted by: sussman | October 21, 2013 12:53 PM

As usual, Bill gets it and pulls no punches. California and Maryland (my state) were supposed to be “stars” with their own Exchanges, and although broker certification is doing just fine here, getting someone insured (or into the system) has been an ongoing nightmare.Lynda Sussman

via Covered California giving agents lip service – Articles – Employee Benefit Adviser.


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