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Covered California News & Commentary

Topics of interest to both consumers and agents related to Covered California and the ACA biased in favor of the successful implementation of the Exchange and deliberately apolitical.

Essential Health Benefits Law is Costly

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Essential Health Benefits: SB 951 by Senate member Ed Hernandez (D-West Covina) and AB 1453 by Assembly member Bill Monning (D-Carmel) passed a concurrence vote in separate houses, and are now headed to the governor for signature.

Bar Set Too High

Recent HHS guidance says states can define their own set of essential benefits by using an existing major health benefit plan in the state as a benchmark. California’s new law will set the level of essential health benefits to be modeled on the Kaiser Permanente Small Group HMO 30 Plan, and include autism, acupuncture and tobacco cessation coverage as well. My understanding is that a version of this plan with an 70% actuarial value will become the Silver Level standard against which all other qualified plans offerings will be based.

Affordability Takes a Hit

An individual buyer of that plan today - say: female, age 45, Los Angeles - would pay a monthly premium of about $400. That number could be considerably higher in 2014 when guaranteed issue and community rating are factored in. Thank God for federal subsidies.

HHS to Blame

The ACA equiped the HHS with broad powers to provide crucial direction to the states. Perhaps they succumbed to essential health benefit politics but in the end they wimped out. The HHS passed the buck to the states, directing them to select from the most popular group benefit plans or federal coverage. Covered California has chosen to go with the “most popular” or “best seller”, the Kaiser HMO 30.

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