Covered California Health Plan Rates To Jump 13.2 Percent In 2017

From Kaiser Health News:

California’s Obamacare premiums will jump 13.2 percent on average next year, a sharp increase that is likely to reverberate nationwide in an election year.

The increase, announced by the Covered California exchange Tuesday, ends the state’s two-year respite from double-digit rate hikes.

The announcement comes as major insurers around the country seek even bigger rate increases for open enrollment this fall, and the presidential candidates clash over the future of President Obama’s landmark health law. ...

Last week, consulting firm Avalere Health found that the average rate increase being sought for widely sold silver plans was 11 percent across 14 states. But consumers could limit the increase by choosing one of the lower-cost silver plans, which are set to go up only 8 percent. ...

Peter Lee, executive director of Covered California, said prices for 2017 reflect the rising cost of care, not efforts by insurers to increase their profits.

“Under the new rules of the Affordable Care Act, insurers face strict limits on the amount of profit they can make selling health insurance,” Lee said. “We can be confident their rate increases are directly linked to health care costs, not administration or profit, which averaged 1.5 percent across our contracted plans.”

Two federal programs that have helped health insurers offset costly medical claims and cover sick patients in general end this year. They were intended as a temporary cushion for insurers who are now required to accept all applicants regardless of their medical histories. ...

Insurers have also complained about lax rules for special enrollment outside the designated signup period that have allowed some people to game the system by waiting until they need care to enroll . Those people tend to generate more claims and higher costs, insurers say. Federal and state officials say they have tightened the rules to address these complaints. ...