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Covered California Q&A

Covered California and Obamacare related questions from consumers, employers and agents are answered by Phil Daigle with the best information available at the time. Archived entries may no longer be accurate as the Covered California and Obamacare knowledge-base is evolving quickly. TO REQUEST A PERSONAL RESPONSE INCLUDE EMAIL ADDRESS.


Insurer Fees Will Help Fund Health Reform

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Question: I read where health insurance companies will have to pay fees to the Exchange. What are those fees for?

Answer: To fund several of the changes mandated by the ACA, new fees will apply to health insurance issuers and self-funded plan sponsors. The fees fund patient-centered outcomes research, the Transitional Reinsurance Program, and premium tax subsidies for individuals in Covered California.

The cumulative affect of the health reform fees in 2014, based on the government rule and industry analysis, shows an increase in the premium by about 3.8 percent. The insurers will collect the funds through premium rates and pay the insurer fees.

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