Covered California looks ahead to 2019
Strong enrollment in 2018, despite national uncertainty
Covered California updated its enrollment data on Wednesday and alerted consumers to a key deadline that is approaching. While the open-enrollment period has ended in most states, uninsured consumers in California have until midnight on Dec. 22 to sign up if they want their coverage to begin on Jan. 1, 2018.
Covered California updated its enrollment data on Wednesday and alerted consumers to a key deadline that is approaching. While the open-enrollment period has ended in most states, uninsured consumers in California have until midnight on Dec. 22 to sign up if they want their coverage to begin on Jan. 1, 2018.
“The time is now to ring in the New Year with a quality health plan that provides protection and peace of mind,” said Peter V. Lee, executive director of Covered California. “We have seen thousands of people signing up every day as we near this key deadline, and Covered California wants to make sure everyone knows that time is running out to get health coverage that starts on Jan. 1.”
The latest data shows that more than 220,000 new consumers signed up for coverage through Dec. 15, which is about 10 percent more than last year, when 199,000 consumers selected a plan during the same time period. In addition, approximately 1.2 million existing Covered California consumers have had their coverage renewed for 2018.
With the continued health care policy debate at the federal level, Covered California also noted that the individual market faces significant uncertainty in 2019. Three of the main causes of this uncertainty are:
Repeal of the individual mandate penalty: Repeal will take effect in 2019, and could threaten the individual market in many states. Health insurance companies rely on certainty when setting their rates, and may decide to exit their markets in the face of an uncertain market caused by a shrinking pool of consumers who are less healthy.
Lack of federal marketing: Health insurance needs to be sold, particularly to young and healthy individuals who are less likely to feel compelled to purchase coverage on their own. The federal administration significantly reduced the marketing and outreach budget for the current open-enrollment period, which could lead to fewer consumers enrolled, a less healthy risk mix and higher premiums for consumers.
Recent executive order: The president’s executive order called for regulations that would allow the sale of “association health plans” or “short-term plans.” Depending on how these regulations are structured, these plans could skim healthier individuals off the individual market and leave consumers without comprehensive coverage. Not only would these consumers be enrolled in “Swiss cheese” policies that were common prior to the Affordable Care Act, those left in the exchanges would see higher premiums because of a less healthy consumer pool.
Without federal action to offset the destabilizing effects of these issues, Covered California estimates that between 10 and 20 states could be left without any carriers in their exchanges in 2019. Consumers in the remaining exchanges could also face dramatically higher premiums, particularly those who do not receive any financial assistance.
During its December board meeting, Covered California discussed several federal policies that could make a difference in stabilizing individual markets across the country and noted that now is the time for bipartisan efforts to protect consumers and lower premiums. These policies include:
Reinsurance or highrisk pool: Implementing state-based risk stabilization programs such as reinsurance or invisible high-risk pools is the focus of bipartisan legislation proposed by senators Susan Collins and Bill Nelson. If appropriately structured and funded, it could reduce premiums by between 10 and 12 percent in 2019, while providing the certainty health carriers need to remain in markets.
Federal marketing commitment: Other bipartisan legislation proposed by senators Lamar Alexander and Patty Murray includes provisions that would require the federal government to spend $100 million annually to promote enrollment. While Covered California relies on its own funding to invest more than $100 million in marketing and outreach, federal proposals like this would inject stability into states that rely on the federally facilitated marketplace.
Restore cost-sharing reduction (CSR) funding: While many states developed a workaround to compensate for the cancellation of reimbursement payments to carriers that provide low-cost services to low-income consumers, it is an imperfect solution that is less effective and actually costs the federal government more through increased tax credit spending. The Alexander-murray proposal would restore this funding.
Removing the health insurance tax: The removal of this tax, which is included in the Patient Protection and Affordable Care Act, would lead directly to lower premiums.
Covered California also wants consumers to know that while the enrollment deadline for most states was Dec. 15, Californians will have through Jan. 31, 2018, to explore their options and select a plan that best fits their needs. While consumers can sign up for coverage in the month of January, if they wait until then, their coverage will not start until Feb. 1 or March 1.