Thursday, April 17, 2014
YOLO COUNTY NEWS
99 CENTS

Geography to play larger role in health premiums

SACRAMENTO (AP) — Whether it’s the densely populated Southern California coast or the mountains of rural Northern California, geography is going to play a larger role in the cost of health insurance under the federal health care overhaul set to take effect next year.

Health insurers are facing new rules and restrictions on how they set prices as part of the Affordable Care Act’s aim to expand coverage to millions of Americans. No longer can insurers deny coverage because of a preexisting condition or place lifetime limits on medical care. While a person’s age will remain a factor in setting rates, older customers cannot be charged more than three times what younger customers pay.

California also has rejected an option under the federal law that allows health insurance companies to charge smokers up to 50 percent more for their premiums.

All this leaves geography as one of the few ways insurers can adjust premiums. The premiums will not be set for most consumers under the law until summer, although estimates are available at the website of California’s health benefits exchange, www.coveredca.com .

The federal government has proposed that a state should not create more than seven geographic rating areas to prevent insurers from charging excessively high premiums in certain areas.

To accommodate California’s size and diversity, the state’s health exchange is proceeding with 19 regions with the understanding that its plan eventually will receive federal approval.

To complicate matters, state lawmakers are scheduled to convene a special session next week, during which the Democrats who dominate the Legislature could come up with their own number.

“Should there be one rate for all of California, every zip code or something in between?” said Anthony Wright, executive director of Health Access California, which advocates for low-income families.

It’s still too early to say just how much of a determining factor geography will be in setting premiums.

But one health plan rated the difference between east and west Los Angeles County by a factor of 50 percent, which could mean a difference of hundreds of dollars for a family of the same size and whose members are the same age.

Health plans argue that 19 rate-setting regions are necessary in California because premiums should reflect the underlying costs of care. Those costs include regional wage rates, number of hospitals and the amount of competition in the area for providing medical services.

Health policy experts say different regions carry different risks for disease and access to treatment. For example, the Central Valley has higher incidence of asthma because of its poor air quality.

But consumer advocates are concerned that smaller regions will give health plans the opportunity to target poor, rural or less healthy communities with higher rates, similar to how insurance companies have charged higher auto rates in some communities deemed higher risk.

California needs to balance the social benefit of spreading risk — defined as having healthy people subsidize care for those who are less healthy — against having people paying their own medical costs, said Marian Mulkey, director of the Oakland-based nonprofit California HealthCare Foundation’s health reform initiative.

“There’s probably some Goldilocks, just-right balance between there, but it’s extremely hard to find,” she said. “And that’s why this is a sticky conversation and difficult to navigate.”

California Secretary of Health and Human Services Diana Dooley said having seven rating regions is “completely unrealistic for California.” The state is moving ahead with 19 regions with the understanding that the federal government will allow it.

“We’re going to be making adjustments to this, certainly in the first few years and maybe over the course of the decade,” she said. “When we see how this performs after a year or two, we may come back and make changes to those rating regions.”

The U.S. Department of Health and Human Services is currently reviewing comments and plans to issue a new rule soon.

At this time, there is no geographic standard for setting premiums. Health plans typically have used nine rating regions in California because they also can use so many other factors in determining premiums, said Charles Bacchi, executive vice president of the California Association of Health Plans.

Health insurers had argued that California needs many rate-setting regions because the state is asking them to switch to a standard benefit design next year.

While it will allow consumers to make direct comparisons of health plans, insurers say the standardization of benefits could drive up premium costs. That is because it restricts the amount and the number of ways they can charge people for co-pays, co-insurance and deductibles.

————

By Judy Lin

The Associated Press

LEAVE A COMMENT

Discussion | No comments

The Davis Enterprise does not necessarily condone the comments here, nor does it review every post. Read our full policy

.

News

Benefit set for local bike legend

By Adrian Glass-Moore | From Page: A1

 
 
Downtown post office set to reopen

By Thomas Oide | From Page: B3

Run or walk to prevent child abuse in Yolo County

By Enterprise staff | From Page: B3 | Gallery

 
Nominations sought for charity paint giveaway

By Enterprise staff | From Page: B3

 
Scholar will discuss human trafficking in Friday talk

By Enterprise staff | From Page: A3

Per Capita Davis: Now, for some good news

By John Mott-Smith | From Page: A4

 
Birch Lane hosts 50th anniversary party

By Enterprise staff | From Page: A4

Hannah Stein reads poetry at gallery

By Enterprise staff | From Page: A4

 
Davis Food Co-op to offer free bags on Earth Day

By Enterprise staff | From Page: A4

Get in the picture with school board candidate

By Special to The Enterprise | From Page: A4

 
Tickets on sale for Pence Garden Tour

By Enterprise staff | From Page: A4

KDVS hosts on-air fundraiser April 21-27

By Enterprise staff | From Page: A4

 
Fundraiser planned for Allen’s campaign

By Enterprise staff | From Page: A4

Food Co-op board plans open house

By Enterprise staff | From Page: A4

 
Davis Downtown hosts candidate forum

By Dave Ryan | From Page: A4

Learn more about Google Glass at talk

By Enterprise staff | From Page: A4

 
Barbecue celebrates winter shelter program

By Special to The Enterprise | From Page: A5

Sign of things to come

By Fred Gladdis | From Page: A8

 
Davis Soroptimists celebrate 60 years

By Special to The Enterprise | From Page: A8

.

Forum

A great community effort

By Letters to the Editor | From Page: A6

 
Public Health Heroes honored

By Letters to the Editor | From Page: A6

Tom Meyer cartoon

By Debbie Davis | From Page: A6

 
Don’t miss a Trokanski dance

By Letters to the Editor | From Page: A6

Frank Bruni: The oldest hatred, forever young

By New York Times News Service | From Page: A6

 
Expert: Free parking is a myth

By Special to The Enterprise | From Page: A6

Have they really learned?

By Letters to the Editor | From Page: A6

 
.

Sports

River Cats’ streak reaches six wins

By Enterprise staff | From Page: B1

 
Landry evolves into UCD women’s lacrosse leader

By Bruce Gallaudet | From Page: B1 | Gallery

Huge inning propels Pleasant Grove past DHS

By Enterprise staff | From Page: B1

 
Giants edge Dodgers

By The Associated Press | From Page: B1 | Gallery

Foster steps down as Lady Blue Devil basketball coach

By Bruce Gallaudet | From Page: B1 | Gallery

 
Youth roundup: Martinez, Chan come up big at gymnastics regional

By Enterprise staff | From Page: B2 | Gallery

Kings drop season finale to Suns

By The Associated Press | From Page: B2

 
Angels get past A’s in extras

By The Associated Press | From Page: B8 | Gallery

.

Features

.

Arts

Wineaux: Good deals off the beaten path

By Susan Leonardi | From Page: A7

 
Rockabilly phenom to play at The Palms

By Enterprise staff | From Page: A7

‘One’ singular sensation to open at DMTC

By Enterprise staff | From Page: A7

 
HellaCappella showcases a cappella singing

By Enterprise staff | From Page: A7

25th annual state clay competition exhibit at The Artery

By Enterprise staff | From Page: A7

 
.

Business

.

Obituaries

Tapan Munroe

By Special to The Enterprise | From Page: A4

 
.

Comics

Comics: Thursday, April 17, 2014

By Creator | From Page: B6