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Department of Insurance analysis finds California consumers experienced steep health insurance rate hikes in 2014

News: 2014 Press Release

For Release: July 29, 2014
Media Calls Only: 916-492-3566
Email Inquiries: cdipress@insurance.ca.gov
Department of Insurance analysis finds California consumers experienced steep health insurance rate hikes in 2014

SACRAMENTO, Calif. - A Department of Insurance analysis comparing 2013 and 2014 health insurance plan rates found that the rate increases many Californians received in 2014 were even higher than in previous years.

The rate analysis was conducted in response to consumer complaints regarding steeply rising health insurance rates in 2014. The department's analysis comparing 2013 and 2014 plan rates found that despite claims that rates were lower than expected, the average rate increases for people who had insurance in 2013 and bought 2014 coverage were between 22 and 88 percent after considering variation for geographic location and age. 

"Many Californians continue to face increasing health insurance rates," said Insurance Commissioner Dave Jones. "The Department of Insurance found that those who had health insurance in 2013 and who then bought coverage in 2014 experienced rate hikes on average between 22 and 88 percent, after considering variations for region and age. For those whose incomes were low enough, there were premium subsidies under the Affordable Care Act. But for Californians whose incomes were not low enough, there was likely a major rate increase."

To conduct the analysis comparing 2013 premiums in California's individual health insurance market to 2014 premiums, the department's health actuarial office obtained data from the largest health insurers and health plans in California about the price of the health insurance and health plan offerings in the individual market in 2013. The department also obtained information about the prices for 2014 in each geographic rating region and for each age band.

The methodology used to conduct the Department's analysis of 2014 rates compared the health insurance products that had the largest enrollment in 2013 to the products with the largest enrollment products offered for 2014 sale. The data from both 2013 and 2014 were broken down by age and by geographic area of California. The rate increases between 2013 and 2014 are not the result of changes in benefits because California had strong mandates in place prior to 2014 and implemented new benefit requirements prior to 2014, including prohibiting gender rating,and requiring autism coverage and maternity benefits.

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Media Notes:



The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $289 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $394 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.

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