Insurance Commissioner Jones issues statement on Health Exchange announcement regarding participating insurers
News: 2013 Press Release
SACRAMENTO - "I applaud Covered California for moving quickly to prepare for the October 1 open enrollment period when millions of Californians without health insurance and those currently with individual or family coverage will shop for new health insurance. The Department of Insurance has worked hard over the last two years assisting with the establishment of the Exchange--now called Covered California. The Covered California Board and staff should be commended for accomplishing a great deal in a short period of time.
California is one step closer to realizing the promise of healthcare reform to make insurance accessible to the uninsured and underinsured. When fully operational, Covered California will provide consumers with the ability to compare products and prices and verify eligibility for federal premium subsidies for consumers who qualify.
As important as this progress is, there is still much more work to be done. Because the proposed rates are to be filed with the Department of Insurance and the Department of Managed Health Care today, it is premature to hazard an opinion as to how these rates compare to rates in the individual market today or whether they are justifiable. We don't yet know the average rate increase that consumers in the individual market will face.
There are only three statewide health insurers selling in Covered California, which means less statewide competition than we'd hoped to see in the new marketplace. Major national health insurers like Aetna, United Healthcare and CIGNA are not participating in the Exchange.
I remain very concerned that there is no legal authority in California to reject unreasonable and excessive rate hikes. Health insurance rates have increased dramatically over the last several years, and are likely to continue to climb unless California law is changed to provide consumer protection through effective health insurance rate regulation, which means the authority to reject excessive rate hikes. Rate regulation has proven an effective consumer protection with tens of billions of dollars returned to consumers and businesses through rate reductions over the 25 years rate regulation has been in effect for other lines of insurance, such as auto and homeowners. We need to change California law to require health insurers to justify their rates and to provide the legal authority to reject excessive health insurance rate increases."
The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $288 billion in premiums annually in California. In 2015 the California Department of Insurance received more than 155,000 calls from consumers and helped recover over $84 million in claims and premiums. Please visit the Department of Insurance web site at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.HELP or 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.