SACRAMENTO, Calif. — Covered California on Thursday announced a modest rate change for 2019 and said many enrollees will be able to mitigate the impact if they shop and switch to the lowest-cost plan in the same metal tier. The exchange also described how the recent federal decision to eliminate the penalty for the individual mandate will raise costs for the federal government and all consumers in the individual and employer-sponsored markets.
“Covered California continues to benefit millions of people in our state by giving them access to high-quality, affordable health coverage,” said Covered California Executive Director Peter V. Lee. “It is unfortunate when a rate change of nearly 9 percent is generally viewed as good news, when the rate change could — and should — have been much lower.”
Consumers in both Covered California and off-exchange in the individual market will see an overall average statewide rate increase of 8.7 percent to their gross premiums if they renew coverage in the same plan for 2019 (see Table 1).
The proposed rates, negotiated with Covered California and filed Thursday with regulators and subject to their final review, mean those who receive a subsidy to help purchase coverage will pay an average of 6 percent more if they renew in the same plan next year, which translates to an estimated monthly premium of $123 after tax credits. Subsidized consumers account for 88 percent of Covered California’s enrollment, and those subsidies rise along with rates to help offset any increases.
Consumers, both on and off the exchange, will continue to benefit from Covered California’s competitive marketplace, which allows them to shop for the best value and save money if they switch plans. The average rate change for consumers who shop and switch to the lowest-cost plan in the same metal tier is -0.7 percent, which means that many Californians can pay the same rate as they do now in 2018, or a little less, if they shop and switch.
“Covered California’s marketplace fosters competition that puts consumers in the driver’s seat and gives them the power to shop and save,” Lee said. “Health care is local, and the price of coverage varies by health plan and region, so consumers will be encouraged to shop when they renew this fall.” (See Table 2 for a complete list of rate changes by region.)
All 11 insurers currently serving Covered California will return for the 2019 coverage year. Covered California’s competitive marketplace continues to promote choice, with 96 percent of consumers being able to choose from two insurers or more and 82 percent of consumers having three or more choices.