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North Bay Business Journal

Monday, April 7, 2014, 6:00 am

With late surge in enrollments, next phase of ACA begins

Reported 32 percent of Covered California enrollees ‘invincibles’

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    Over the past week, proponents of the Affordable Care Act have touted the sheer numbers of those enrolling in health plans offered on both the federal and statewide exchanges, which nationally reached more than 7 million and in California reached over 1.2 million — both above stated goals.

    But as details of those who enroll become clearer in the coming weeks, insurance carriers and brokers will be closely watching the spread of risk, or whether or not enough younger, healthier individuals signed up to offset the older or sicker population, to keep rates down.

    On a national level, several large carriers, like Cigna, have expressed concern that the patient population will be older and sicker, thereby pushing up utilization costs and possibly causing rate hikes come 2015.

    In California, WellPoint, Inc., parent company of Anthem Blue Cross, has similarly expressed concern on plans offered through Covered California could see percentage increases in the double digits.

    While it’s likely too early to draw any definitive conclusions, Victor McKnight, a principal with EPIC Insurance Brokers in Petaluma, said it’s not exactly encouraging if national carriers are expressing such sentiments.

    “Carriers don’t know what the risk is; they’re still getting people in,” he said. “They’re all trying to figure out ways to save money and save costs.”

    In addition, many employer plans will need to be significantly altered come 2015 to meet full compliance with the Affordable Care Act. Groups that renewed early — late last year — were able to temporarily put off full compliance for 2014, but will face the same issue again later this year and may face rate increases as a result.

    Younger residents ages 18–34 — the so-called “invincibles” — accounted for about 32 percent of total Covered California enrollment, which will likely bode well for state in terms of spreading the risk. All told, the 18-34 segment accounts for about 36 percent of the total market.

    “March was a very good month for the enrollment of young adults, ” said Peter Lee, executive director for Covered California. “In fact, the 344,000 young adults who have selected a plan put enrollment for this group at 162 percent of the base projection of 212,000,” Mr. Lee said.

    It’s not yet known how many people who signed up through Covered California were previously uninsured. However, one clear success, at least in California, has been the Medi-Cal expansion under the ACA, which has added hundreds of thousands of previously uninsured residents to its rolls.

    Statewide, Medi-Cal enrolled approximately 1.9 million people through the end of March, including 1.1 million through the Covered California portal and county offices, approximately 650,000 former Low Income Health Program members who were transitioned to Medi-Cal by the California Department of Health Care Services, and 180,000 individuals who applied through the state’s Express Lane program, according to Covered California.

    Through the end of February, the latest available information from Covered California, North Bay counties — Marin, Sonoma, Napa and Solano — had more than 35,000 signups in exchange plans, a number that likely increased in the final month and weeks of enrollment ending March 31.

    The following carriers offer plans in the North Bay through the exchange: Anthem Blue Cross of California, Blue Shield of California, Health Net, Kaiser Permanente and Western Health Advantage.

    Kaiser has by far had the most signups across the North Bay for residents who are eligible for subsidies, with 44 percent. It’s followed by Anthem, with 34 percent, Blue Shield with 16 percent and Health Net and Western Health each with 3 percent.

    In the nonsubsidized signups, Anthem had 40 percent, Kaiser had 35 percent, Blue Shield had 12 percent, Health Net had 7 percent and Western Health had 4 percent.

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