Study: CA Obamacare clients struggle with cost

In May 2013, Covered California officials faced sharp criticism over claims that premiums would actually go down for many health insurance purchasers. Forbes.com’s Avik Roy wrote that the agency implementing the Golden State’s version of Obamacare needed to look at its own data, which suggested health premiums would surge at least 64 percent after the regulations in the Affordable Care Act took effect. Bloomberg analysts offered similar criticisms.

Two years later, the Kaiser Family Foundation has issued a report that suggests these warnings were more accurate than the upbeat predictions of Covered California Executive Director Peter Lee. A key finding:

“Among adults who say that they pay a monthly premium for their health coverage, nearly half of newly insured adults (47 percent) say it is somewhat or very difficult to afford this cost, compared to just 27 percent of adults who were insured before 2014. When looking specifically by type of coverage, 44 percent of Covered California enrollees (not all of whom are newly insured) report difficulty paying their monthly premium, versus a quarter of adults with other types of private coverage. Medi-Cal enrollees do not pay monthly premiums for their coverage.”

Cost, not glitches, slowing CA sign-ups

The Kaiser report, which was based on interviews with 4,555 Californians, says the cost factor is the biggest barrier to higher enrollments, not online technical snafus:

“Cost continues to prevent many uninsured adults from seeking coverage. While many people focused on website glitches and administrative barriers during 2014, uninsured adults say that the reason they still lack coverage is because it’s too expensive, with most not even trying to get ACA coverage, and many who did still saying they are ineligible or believe the coverage is too costly.”

The cost of premiums is also prompting Californians to quit Covered California, KCRA TV in Sacramento reported, citing documents showing that 150,000 people dropped their state coverage in 2014.

These developments come in a pivotal year for Covered California — the last year in which federal subsidies will help cover the subsidies provided by the state agency. By law, beginning in 2016, the agency cannot seek state subsidies and must rely only on revenue it generates from premiums. Its goal was to have 1.7 million residents enrolled by Feb. 15, but it fell far short, with 1.4 million signups.

More criticism from national media

Meanwhile, Covered California is again provoking comment from outside of California. A May 31 Columbia Journalism Review essay by Trudy Lieberman criticized coverage of the agency as misleading:

It’s not easy to figure out how to monitor the progress of Covered California, the country’s largest state-run health insurance exchange.

 

Is it the total number of people who have signed up for an insurance plan on the exchange during open enrollment? The rate at which people renew? The number of new sign-ups in a given year? The number of Latino sign-ups? The number of “covered lives”? The number of Californians who have had coverage through the exchange at any point? Or, simply, the overall rate of uninsured adults across the state?

 

“In recent months, Covered California has cited each of these measures to tout its success. And though outside analysts have raised some notes of caution, press coverage has largely followed the lead set by the exchange. The result is coverage that has too often been reactive, short on enterprise, and with missed opportunities to ask some necessary questions. Covered California may ultimately have a success story to tell — but it will need to face some sharper skepticism before we can be sure.”

Lieberman wrote that California journalists should spend more time talking to affected state residents about their experiences with the agency and be less inclined to accept Covered California’s characterizations of its record.