Crit­ics aside, the state is prov­ing health law works

Los Angeles Times - - CALIFORNIA - By Noam N. Levey

WASH­ING­TON — Even as tur­moil in in­sur­ance mar­kets na­tion­wide fu­els re­newed elec­tion-year at­tacks on the Af­ford­able Care Act, Cal­i­for­nia is emerg­ing as a clear il­lus­tra­tion of what the law can achieve.

The state has recorded some of the na­tion’s most dra­matic gains in health cov­er­age since 2013 while build­ing a com­pet­i­tive in­sur­ance mar­ket­place that of­fers con­sumers en­hanced pro­tec­tions from high med­i­cal bills.

Cal­i­for­ni­ans, un­like peo­ple in many states, have many in­sur­ance choices. That means that even with ris­ing pre­mi­ums, the vast ma­jor­ity of con­sumers should be able to find a plan that costs them, at most, 5% more than they are pay­ing this year.

And all health plans be­ing sold in the state will cap how much pa­tients must pay for pre­scrip­tions ev­ery month and for many doc­tor vis­its.

That re­flects de­lib­er­ate choices by Cal­i­for­nia of­fi­cials who, un­like those in many states, used the health law to ex­pand the Med­i­caid safety net and build a mar­ket­place that put

strin­gent re­quire­ments on in­sur­ance com­pa­nies.

“Cal­i­for­nia fol­lowed the blue­print. They did it right,” said Dr. J. Mario Molina, chief ex­ec­u­tive of Long Beach-based Molina Health­care Inc., a lead­ing na­tional in­surer that is sell­ing mar­ket­place plans in nine states in 2017.

“What has been lost in all the rhetoric and the pol­i­tics is that the sys­tem can work,” Molina said. Open en­roll­ment be­gins next month.

Cal­i­for­nia and its Oba­macare mar­ket­place, Cov­ered Cal­i­for­nia, still face chal­lenges, in­clud­ing ris­ing costs. Like con­sumers else­where, some Cal­i­for­ni­ans, par­tic­u­larly those who make too much money to qual­ify for gov­ern­ment sub­si­dies, are see­ing sub­stan­tial pre­mium in­creases and nar­row­ing net­works.

Though health cov­er­age has fal­tered in other states where politi­cians worked to un­der­mine the law, Cal­i­for­nia high­lights what can be ac­com­plished if gov­ern­ment of­fi­cials and in­dus­try lead­ers work to­gether to ex­pand in­sur­ance, con­trol costs and pro­tect con­sumers.

Many of the ad­vances be­ing pi­o­neered in Cal­i­for­nia have been in­cor­po­rated into Demo­crat Hil­lary Clin­ton’s pro­gram to im­prove on the Af­ford­able Care Act if she is elected pres­i­dent.

“We’re not just the big­gest state and one of the states that’s most ag­gres­sively taken ad­van­tage of tools in the Af­ford­able Care Act,” said An­thony Wright, ex­ec­u­tive direc­tor of Health Ac­cess Cal­i­for­nia, a lead­ing con­sumer ad­vo­cate. “We are also one of the states that had the big­gest prob­lems to start with.

“Now we’re show­ing that you can use the law as a plat­form to ben­e­fit pa­tients.”

Be­tween 2013 and 2015, the share of work­ing-age adults in Cal­i­for­nia with­out cov­er­age shrank from 23.7% to 11.1%, ac­cord­ing to fed­eral data. Only three states saw greater re­duc­tions over the same pe­riod.

The new cov­er­age has dra­mat­i­cally im­proved pa­tients’ ac­cess to med­i­cal care and re­duced fi­nan­cial strains, other re­search in­di­cates.

More than three-fourths of newly in­sured Cal­i­for­ni­ans said their health needs are now be­ing met, a re­cent sur­vey by the non­profit Kaiser Fam­ily Foun­da­tion found. By con­trast, less than half said they were get­ting needed care be­fore they got cov­er­age through the health law. At the same time, Cal­i­for­ni­ans who gained cov­er­age re­ported fewer wor­ries about pay­ing for not just health­care, but also hous­ing, trans­porta­tion, even food.

For Del Hunter-White, 60, a Los An­ge­les ac­tress who lost her in­sur­ance through the Screen Ac­tors Guild when she didn’t work enough to qual­ify for the union plan, Cov­ered Cal­i­for­nia opened just in time.

“It was a life­saver,” she said, not­ing she prob­a­bly wouldn’t have been able to get cov­er­age. “At my age, you don’t want to go with­out in­sur­ance.”

Hunter-White found a health plan that costs her $195.87 a month and al­lows her to see the doc­tors she wants. “It’s been great,” she said.

Over­all, nearly 8 in 10 newly in­sured Cal­i­for­ni­ans feel pos­i­tively about their cov­er­age, Kaiser found.

Much of the in­sur­ance ex­pan­sion in Cal­i­for­nia has been fu­eled by the state’s de­ci­sion to take ad­van­tage of fed­eral fund­ing in the health law to ex­pand Med­i­caid el­i­gi­bil­ity to poor, child­less adults, a pop­u­la­tion tra­di­tion­ally ex­cluded from most states’ safety nets.

But Cov­ered Cal­i­for­nia has also played a crit­i­cal role, with about 1.3 mil­lion di­rect cus­tomers and nearly 1 mil­lion more who get health plans that must meet Cov­ered Cal­i­for­nia stan­dards even though con­sumers don’t use the mar­ket­place to pur­chase them.

The large en­roll­ment isn’t an ac­ci­dent.

Many states now fac­ing the big­gest prob­lems with their in­sur­ance mar­kets ac­tively re­sisted the health law, re­fus­ing to ex­pand Med­i­caid or to help build a new mar­ket­place in which con­sumers could shop for health plans.

By con­trast, state lead­ers in Cal­i­for­nia, in­clud­ing for­mer Repub­li­can Gov. Arnold Sch­warzeneg­ger, de­cided early that Cal­i­for­nia’s in­sur­ance mar­ket­place would set high stan­dards for health plans and ac­tively ne­go­ti­ate to con­trol prices.

In the first two years of the mar­ket­place, pre­mi­ums in­creased an av­er­age of just 4%, aided by a fed­eral pro­gram that helped keep down rates.

The state made a dif­fi­cult de­ci­sion to ter­mi­nate old plans that didn’t meet the health law’s higher stan­dards, a cru­cial move that helped sta­bi­lize the mar­ket by bring­ing the health­ier con­sumers who had these plans into the larger risk pool.

The state also worked closely with foun­da­tions, con­sumer ad­vo­cates, hos­pi­tals and in­sur­ers to en­roll cus­tomers, par­tic­u­larly younger, health­ier peo­ple who are also crit­i­cal to main­tain­ing a good risk pool and keep­ing pre­mi­ums in check.

“We all worked to­gether to make sure the mar­ket­place worked,” said Jay Gellert, for­mer chief ex­ec­u­tive of Los An­ge­les-based in­surer Health Net Inc., which merged this year with Cen­tene Corp.

Now, Cov­ered Cal­i­for­nia is im­ple­ment­ing con­sumer pro­tec­tions that ex­empt many rou­tine of­fice vis­its from de­ductibles.

That means that some­one who has a health plan with a $2,500 de­ductible can still see a pri­mary care doc­tor for just a $35 co­pay and see a spe­cial­ist for just $70.

Peter Lee, ex­ec­u­tive direc­tor of Cov­ered Cal­i­for­nia, said these new pro­tec­tions should make the health plans more ap­peal­ing to cus­tomers who might have re­sisted buy­ing a plan that re­quired them to pay thou­sands of dol­lars out of their own pock­ets be­fore they got any pro­tec­tion.

“No pa­tient I know wants to pay $2,500 to see the doc­tor,” Lee said.

Lee and oth­ers ac­knowl­edge that even the new pro­tec­tions won’t al­le­vi­ate all cost pres­sures on health plans and con­sumers.

In 2017, Cov­ered Cal­i­for­nia rates are in­creas­ing an av­er­age of 13.2%, driven in part by ris­ing med­i­cal costs and the end of the fed­eral mech­a­nism that held down rates.

Pre­mi­ums for sev­eral in­sur­ers, in­clud­ing Blue Shield of Cal­i­for­nia and An­them Inc., are in­creas­ing even more dra­mat­i­cally.

Avoid­ing large rate in­creases in the fu­ture will re­quire ad­just­ments to the mar­ket­places in Cal­i­for­nia and else­where, many ex­perts say.

But many states could start to make their mar­kets work by fol­low­ing the steps Cal­i­for­nia has al­ready taken, said Molina, the health plan ex­ec­u­tive.

“Had states like Texas and Florida fol­lowed Cal­i­for­nia’s lead, they might have seen more gains like Cal­i­for­nia’s,” he said.

Ir­fan Khan Los An­ge­les Times

ENROLLEES AT a Cov­ered Cal­i­for­nia event in Panorama City in 2014. Un­like other states that re­sisted the Af­ford­able Care Act, Cal­i­for­nia used it to ex­pand Med­i­caid, con­tain ex­penses and pro­tect con­sumers.

Chip So­mod­ev­illa Getty Images

“WHAT HAS been lost in all the rhetoric and the pol­i­tics” over Oba­macare “is that the sys­tem can work,” says one health in­surer’s CEO.

Al Seib Los An­ge­les Times

BE­TWEEN 2013 and 2015, the share of work­ing-age adults in Cal­i­for­nia with­out cov­er­age shrank from 23.7% to 11.1%. Open en­roll­ment starts next month.

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