New Data Show How Covered California Spurs Competition Among Health Insurance Companies

Consumers Choose a Wider Variety of Plans as Pricing Drives the Market

SACRAMENTO, Calif. — Covered California released new enrollment data on Tuesday, which showed how the state’s healthy mix of enrollees and its aggressive negotiations with health insurance companies led to increased competition in the marketplace and better prices for consumers.

More than 439,000 consumers newly signed up for health care coverage during the most recent open-enrollment period — including approximately 14,000 who received help finishing their applications after the Jan. 31 deadline. Of those new enrollees, the percentage of consumers who selected a health plan outside of the four major carriers — Anthem Blue Cross of California, Blue Shield of California, Health Net and Kaiser Permanente — nearly tripled compared with a year ago.

“Covered California built a marketplace that is leading to sustainable cost trends because of the good risk mix, and that creates a level playing field for carriers, forcing them to compete on price and quality,” Covered California Executive Director Peter V. Lee said. “Competition is driving the market. Consumers are shopping around and selecting the health plan that best fits their needs and pocketbook.”

During Covered California’s first two open-enrollment periods, approximately 94 percent of consumers signed up for coverage through one of the four major carriers. During the third open-enrollment period that number dropped to 83 percent.

Another important finding was that the vast majority of renewing consumers seemed satisfied with the price, quality and level of coverage — with about 88 percent keeping their current plan.

“Price matters, and just like any other business, consumers want the best value possible,” said Covered California Director of Health Plan Management Anne Price. “We have created a marketplace where carriers are fighting for people’s business. With more than 1 million enrollees, our customers are flexing their consumer muscles. They are also part of keeping costs low by being part of a large and healthy risk pool.”

She added: “Compared to much of the nation, where many consumers changed plans when they renewed, our success at keeping prices low allowed consumers to have a win-win — many got to keep their existing plan while getting a good deal.”

For example, several carriers experienced a growth in enrollment after aggressively pricing their products and attracting new consumers from other plans.

• Blue Shield had one of the lowest rate increases in the state for 2016. More than 117,000 consumers signed up with Blue Shield during open enrollment, which, along with the more than 315,000 who selected Blue Shield when they renewed, gave it more than 433,000 consumers, and more plan selections than any other carrier in Covered California.
• Blue Shield gained more than 17,000 renewing consumers from Anthem, which had the highest rate increase, and more than 11,000 renewing consumers from Health Net.
• Molina Healthcare lowered its rates for 2016 and ended up enrolling more than 50,000 new consumers during open enrollment, which, when added to the more than 37,000 who selected Molina in renewal, means it has more than 88,000 enrolled, the fifth-largest total statewide.

Other highlights of the data:

• The number of renewing consumers who selected a Silver plan, which is considered the best value for consumers, stayed very similar to last year’s rate of 65 percent.
• The results highlighted the fact that health care is local, with local or regional plans in Sacramento, San Francisco, San Diego and Los Angeles gaining substantial enrollment.

“This is further proof that the Affordable Care Act is working and that Covered California is working hard to use all the tools to benefit consumers,” Lee said. “We have created a marketplace where there is a good mix of consumers enrolled, which keeps prices down and carriers fighting for people’s business.”

Lee noted that Covered California seeks to put the consumers in the driver’s seat, by making sure that the health insurance companies that participate in the exchange offer true value, and then the exchange negotiates the rates, networks and quality elements to get the best value for consumers. Covered California also created a standard benefit design, which establishes the services that plans must offer and allows consumers to make an apples-to-apples comparison between plans. Before the Patient Protection and Affordable Care Act, it was very difficult to compare plans because they could each have different deductibles, copays, maximum out-of-pocket costs and other benefits.

“When the Affordable Care Act was signed into law six years ago, we all imagined that we would create a competitive marketplace to help consumers comparison-shop and make choices based on price and value,” Lee said. “Now we can see that dream is beginning to become a reality.”

Now that open enrollment has ended, consumers must have a life-changing event in order to be eligible for special enrollment through Covered California. The most common life-changing events are getting married, having a child, losing coverage from a job or Medi-Cal and moving. For more information on special enrollment visit: www.CoveredCA.com/individuals-and-families/getting-covered/special-enrollment. Medi-Cal enrollment is year-round.

Consumers can reach a Service Center representative by calling (800) 300-1506. The nearest Certified Insurance Agent, Certified Enrollment Counselor or Certified Plan-Based Enroller can be found by visiting www.CoveredCA.com/get-help/local and searching for enrollment help by ZIP code.

Covered California Health Insurance Plan Selections (Renewal and Open Enrollment)

Carrier	Plan Selections		Percentages
	2015	2016	2015	2016
Anthem Blue Cross of California	393,911	394,022	28%	25%
Blue Shield of California	348,607	433,111	25%	28%
Chinese Community Health Plan	12,779	13,627	1%	1%
Health Net	247,876	212,278	18%	14%
Kaiser Permanente	335,221	374,454	24%	24%
L.A. Care Health Plan	21,909	15,060	2%	1%
Molina Healthcare	22,299	88,170	2%	6%
Oscar Health Plan of California	N/A	2,067	N/A	<1%
Sharp Health Plan	17,830	25,805	1%	2%
UnitedHealthcare Benefits Plan of California	N/A	1,370	N/A	<1%
Valley Health Plan	2,157	3,320	<1%	<1%
Western Health Advantage	5,773	8,790	<1%	1%
TOTAL	1,408,362	1,572,074	100%	100%

*As of Feb. 7, 2016.

Plan Selections for Third Open Enrollment

Carrier	Plan Selections		Percentages
	2015	2016	2015	2016
Anthem Blue Cross of California	138,610	103,378	28%	24%
Blue Shield of California	93,088	117,790	19%	27%
Chinese Community Health Plan	2,544	2,895	1%	1%
Health Net	94,152	45,763	19%	10%
Kaiser Permanente	138,788	99,047	28%	23%
L.A. Care Health Plan	4,036	3,214	1%	1%
Molina Healthcare	13,207	50,850	3%	12%
Oscar Health Plan of California	N/A	1,568	N/A	0%
Sharp Health Plan	7,393	9,350	1%	2%
UnitedHealthcare Benefits Plan of California	N/A	1,086	N/A	<1%
Valley Health Plan	865	1,396	<1%	<1%
Western Health Advantage	2,390	3,055	<1%	1%

*As of Feb. 7, 2016.

While the percentage of overall enrollment in the four largest health insurance companies has decreased from nearly 95 percent down to 90 percent in two years, plan selections at the local level are growing as a result.

Below are four regional health plan observations about total plan selections. For full regional data, please visit: www.Covered CA.com/news/pdfs/CoveredCA-Regional-Carrier-Data-for-2016.xlsx.

• In Los Angeles, which consists of rating regions 15 and 16, Molina saw its total plan selections jump from 22,299 in 2015 to 88,170 in 2016, nearly a 400 percent increase.
• In San Diego, Sharp Health Plan saw its plan selections increase from 17,830 in 2015 to 25,805 in 2016.
• In San Francisco, Chinese Community Health Plan saw its plan selections increase from 12,799 in 2015 to 13,627 in 2016.
• In Sacramento, Western Health Advantage saw its plan selections increase from 5,773 in 2015 to 8,790 in 2016.

“The open enrollment data released today reminds us of the critical importance of local health plans,” Lee said. “Our consumers know these plans in their communities, and it shows how the Affordable Care Act doesn’t just work for the major players, but for the local health plans as well.”

About Covered California

Covered California is the state’s marketplace for the federal Patient Protection and Affordable Care Act. Covered California, in partnership with the California Department of Health Care Services, was charged with creating a new health insurance marketplace in which individuals and small businesses can get access to affordable health insurance plans. Covered California helps individuals determine whether they are eligible for premium assistance that is available on a sliding-scale basis to reduce insurance costs or whether they are eligible for low-cost or no-cost Medi-Cal. Consumers can then compare health insurance plans and choose the plan that works best for their health needs and budget. Small businesses can purchase competitively priced health insurance plans and offer their employees the ability to choose from an array of plans and may qualify for federal tax credits.

Covered California is an independent part of the state government whose job is to make the new market work for California’s consumers. It is overseen by a five-member board appointed by the Governor and the Legislature. For more information about Covered California, please visit www.CoveredCA.com.