Covered California rates rising by 6% next year
Premiums for health insurance plans sold through the state marketplace will increase an average of 6% next year, Covered California officials announced last week.
The rate hike, which varies by region, is the largest California has seen since 2019. In the past three years, insurers had kept average increases under 2%.
When premiums increase, an individual’s financial aid usually does, too. Aid is based on household income, so subsidies may offset some of the increase. But people who don’t qualify for subsidies will bear the full cost of the rate hike.
“Premiums are a capturing of what health care costs are, how they vary across geographies and communities, how health care costs are growing over time, which we know in this country are already too high and rising,” said Jessica Altman, executive director of Covered California.
She noted that California’s rate hike is still lower than it is in other states. A recent Kaiser Family Foundation analysis found a 10% average premium increase proposed by 72 insurers in 13 other states.
The rate increase, Altman said, is largely attributed to people resuming doctor visits and procedures that they postponed during the peaks of the COVID-19 pandemic. There is also the cost of general inflation.
About 1% of the increase, however, is attributed to the potential loss of enhanced subsidies from the federal government, which are set to expire at the end of this year. Without the additional aid, people will pay more for their premiums, likely pushing young, healthy people to drop their coverage. And when healthy people leave the marketplace, premiums go up for everyone.
Unemployment claims rise for third week as job cuts loom
Applications for U.S. state unemployment insurance rose for a third week to the highest since November as more companies announce job cuts, suggesting some softening in the labor market.
Initial unemployment claims increased by 7,000 to 251,000 in the week ending July 16, Labor Department data showed Thursday. The figures coincide with the reference period for the July jobs report that’s due early next month. The median estimate called for 240,000 applications in a Bloomberg survey of economists.
Continuing claims for state benefits rose 51,000 to 1.38 million in the week ending July 9, the biggest weekly increase since November.
Unemployment claims are rising as more companies announce job cuts amid increasing fears of a recession. The trend may continue as the Federal Reserve ratchets up its fight against rampant inflation with some of the largest interestrate hikes in decades, which could ultimately curb demand for workers.
On an unadjusted basis, initial claims increased to 248,991 last week. Unadjusted claims in Massachusetts rose by more than 14,000. California, South Carolina and Georgia also posted increases.
Border lane carved out for Tesla
At a remote Mexico border crossing a few miles upriver from Laredo, Texas, a green highway sign welcomes friends of an American company in an instantly recognizable font: Tesla.
After moving its headquarters to Austin from Silicon Valley, Elon Musk’s company has struck a deal with one of Mexico’s most pro-business states. Tesla suppliers now have a dedicated lane at the Colombia Solidarity checkpoint to quicken the crossing, said Ivan Rivas, the economy minister of Nuevo León.
“It was a simple incentive,” Rivas said in an interview. “What we want is a crossing that’s much more expedited and efficient. And maybe there will be a lane for other companies in the future like there is for Tesla.”
Tesla didn’t respond to an emailed request for comment, and Rivas, who didn’t negotiate the deal, was unable to provide further information. Other state officials didn’t return calls seeking comment, so it’s difficult to know what Tesla gave, if anything, for its express lane. The exact rules for usage and who administers any paperwork or passes needed to drive back and forth were also unclear.
Nuevo León borders the U.S. for about 10 miles, and the Colombia Solidarity site is among the less popular crossings. At its busiest point, average wait time for commercial trucks is about 20 minutes.