Covered California previews plans

The California health insurance exchange unveiled a preview of its plans, with key insurers including Blue Shield, Anthem, Health Net and Kaiser Permanente.

In all, 13 health plans will be offered to individual policy buyers when the health insurance marketplace opens for business Oct. 1. Covered California is among the first of the Affordable Care Act exchanges to go public with its proposed offerings, releasing the plan May 23.

Covered California said the proposed rates ranged from 2 percent above to 29 percent below the 2013 average premium for small employer plans in California’s most populous regions.

As in Oregon and Washington, the premiums were nowhere near the worst-case scenarios presented by the many critics of Obamacare.

“Rates are going up at far lower than the best estimate (analysts) thought might happen and way below the worst estimates of doom and gloom,” said Peter Lee, the executive director of the health marketplace.

Regulators will have to sign off on the plans and their premiums. Shoppers won’t be able to determine exact rates for their ages and locations until fall, but detailed examples are given in the Covered California rate proposal (PDF)

“Our active negotiating will not only benefit potential enrollees to Covered California, but will benefit all Californians by making health care affordable,” Lee said as he unveiled the plans.

Consumers will have an average of five plans from which to choose, depending on the region, the marketplace said. Represented are HMOs, PPOs and exclusive provider organizations (EPOs).

“Virtually every health plan designed a custom network for Covered California,” the exchange said.

As expected, the health care plans are stacked in four tiers: bronze, silver, gold, platinum. The higher the level, the lower the percent of any medical care that would be paid for by the consumer.

A primary care visit copay would range from $20 to $45 under the “standard benefit design.” For emergency room visits, the range is $150 to $300.

The average premium rate for silver plans (across all regions) is $320, Covered California said.

A 40-year-old who is not eligible for subsidies (due to income) in the Los Angeles region would pay premiums between $242 (Health Net) and $325 (Kaiser) under the silver plan, the exchange said.

A maximum out-of-pocket cost of $6,350 for individuals will “dramatically reduce” the danger of medically induced bankruptcy, the marketplace said. The maximum for families will be $12,700. About 2.6 million Californians will be eligible for government subsidies and more than 5 million will be able to use the exchange, projections show.

“Californians should be proud of how not only health plans in this state, but doctors, medical groups and hospitals have stepped up — creating a market that will allow millions of consumers to enroll in affordably priced products,” Covered California chief Lee said.

Participant Blue Shield of California thanked “the hundreds of hospitals and tens of thousands of physicians who agreed to take a risk and join with us to make quality care more affordable.” Its CEO Paul Markovich said the plans were “proof that health reform can stimulate competition and increase value for consumers.”

Daniel Zingale of the California Endowment said the plans prove “that the dire predictions of exorbitant prices turned out to be as false as the death panels,” referring to old rumors that committees would make life and death decisions.

Release of the Covered California lineup didn’t silence Obamacare critics, of course. Dismissing the comparison of 2014 rates vs. current small employer premiums was “apples and oranges,” says Lanhee Chen of the Hoover Institution, a key player in Mitt Romney’s presidential campaign. “Covered California is trying to make consumers think they’re getting more for less when, in fact, they’re just getting the same while paying more.”

Writing in the New York Post, columnist Betsy McCaughey charged that “this is Costco-style health care, similar to Medicaid. Only a small fraction of doctors are willing to accept these fees.” Don’t expect care at L.A.’s top-rated Cedars-Sinai Medical Center, she warned.

The Covered California plans are under review by the Department of Managed Care and the Department of Insurance.

Sitting out at least for the first year of the exchange are insurance giants Aetna, UnitedHealth and Cigna.

A few of the insurance providers are regional: the Chinese Community Health Plan works in San Francisco and San Mateo; the Contra Costa plan only in that region; the Sharp plan is limited to San Diego. Kaiser Permanente, by comparison, services all regions except the Santa Cruz/Monterey area.

The exchange also plans to offer “catastrophic” plans for those under age 30 who do not qualify for tax credits. The range for a 21-year-old is $136 to $168. These plans would help buyers avoid the penalty for no health insurance required under the Affordable Care Act.

“The days of paying premiums and hoping your insurance will cover you if you get sick are coming to an end,” said Betsy Imholz of Consumers Union. “Covered California will make it dramatically easier for consumers to compare plans and make smart choices that fit their budget.”

The vast majority of Californians are covered via employer insurance, meaning they probably wouldn’t shop for individual policies in the Obamacare marketplaces. Some small businesses will benefit, however.

Covered California is expected to announce the options for small businesses to buy health insurance in June.

Here is a complete list of the health care insurers participating in the Affordable Care Act marketplace in California:

• Alameda Alliance for Health
• Anthem Blue Cross of California
• Blue Shield of California
• Chinese Community Health Plan
• Contra Costa Health Plan
• Health Net
• Kaiser Permanente
• L.A. Care Health Plan
• Molina Healthcare
• Sharp Health Plan
• Valley Health Plan
• Ventura County Health Care Plan
• Western Health Advantage