- Analysis shows Covered California’s investments in marketing, outreach and patient-centered benefits have led to a consumer pool that is healthier than the national average, resulting in more-stable rates and enrollment.
- The stability extends to California’s off-exchange market, which reflects unsubsidized consumers, where enrollment has remained relatively constant while national off-exchange enrollment has dropped significantly.
- Covered California’s executive director says this report provides yet more evidence to support state and federal investments in marketing and outreach to promote enrollment, which result in lower costs for middle class Americans who do not receive subsidies.
“A healthy pool of consumers is the foundation of the stability of California’s individual insurance market because healthier consumers mean lower premiums for everyone, which helps promote more enrollment,” said Peter V. Lee, executive director of Covered California. “From the start, Covered California has focused on enrolling a healthy mix of consumers, and this analysis provides new evidence that investing in promoting enrollment is essential and pays off in the form of reduced premiums for those who do not receive subsidies.”
The study, titled “National vs. California Comparison: Detailed Data Help Explain the Risk Differences Which Drive Covered California’s Success,” was posted today on Health Affairs, a prominent website devoted to health policy and issues affecting health and health care. The analysis was conducted by Wakely, a nationally recognized health care actuarial consulting firm, along with Covered California’s chief actuary, John Bertko.
The study’s three key findings:
- California’s individual market risk score is about 20 percent lower than the other states’ average risk score from 2015 through 2017.
- Covered California’s risk scores are lower than the national average across every metal tier (Bronze, Silver, Gold and Platinum) for each of the three years examined.
- California’s off-exchange enrollment, where consumers enroll outside of Covered California but generally get the same products at the same prices as they would on-exchange but without the benefit of the federal tax subsidy, remained relatively constant from 2015 to 2017. The rest of the nation’s off-exchange enrollment decreased substantially during that same period. This decrease is important because off-exchange enrollees tend to be healthier than average, and these are individuals who do not have the federal tax credit to make coverage more affordable.
The study pointed to four key reasons why California has been successful in attracting and retaining a healthier mix of consumers:
- California expanded its Medicaid program, known as Medi-Cal, and studies show that states that expanded Medicaid coverage have lower risk scores.
- States that established their own marketplace, such as Covered California, have lower risk scores than states that rely on the federal marketplace.
- Covered California and other state-based exchanges tend to invest more in marketing and outreach, which are critical to enrolling new consumers.
- Covered California’s patient-centered benefit designs, which are standard across plans in each metal tier, help reduce consumer confusion.
“Enrolling and keeping consumers in health care coverage is an ongoing process that takes ongoing investments. Marketing and outreach are critical to informing the public about their options and educating them about the value of coverage,” Lee said. “When you pull back on these elements, you will see fewer healthy consumers enrolling, which will lead to higher premiums for unsubsidized consumers in those markets.”
An estimated 13 million people are enrolled in the individual market across the country. Of those, approximately 5 million do not receive any financial help. A Covered California analysis found that most unsubsidized consumers are not high-income earners and have a median annual income of $75,000 (see Table 2).
The most recent data shows that California’s uninsured rate fell to a record low of 6.8 percent at the end of 2017, down from 17 percent at the end of 2013 before coverage was available through the Affordable Care Act.
Right now consumers can enroll through Covered California’s special-enrollment period if they have a qualifying life event, like losing their coverage or moving. For more information on special-enrollment rules, visit http://www.CoveredCA.com/individuals-and-families/getting-covered/special-enrollment. Applicants have 60 days from the date on which the qualifying life event happens to enroll in a plan through Covered California.
Those who qualify for Medi-Cal may enroll through Covered California year round.
Eligible consumers who are interested in signing up should go to www.CoveredCA.com where they can get help to enroll. They can explore their options and find out if they qualify for financial help by using the Shop and Compare Tool. They can also get free and confidential enrollment assistance by visiting www.coveredca.com/find-help/ and searching among 800 storefronts statewide, or more than 17,000 certified enrollers who can assist consumers in understanding their choices and enrolling, including individuals who can assist in other languages. In addition, consumers can reach the Covered California service center by calling (800) 300-1506.
About Covered California
Covered California is the state’s health insurance marketplace, where Californians can find affordable, high-quality insurance from top insurance companies. Covered California is the only place where individuals who qualify can get financial assistance on a sliding scale to reduce premium costs. Consumers can then compare health insurance plans and choose the plan that works best for their health needs and budget.
Depending on their income, some consumers may qualify for the low-cost or no-cost Medi-Cal program.
Covered California is an independent part of the state government whose job is to make the health insurance marketplace 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.
Source: Covered California