California Will Not Extend Canceled Health Policies

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(11-21) 15:46 PST SACRAMENTO — Covered California, the state's health exchange, on Thursday rejected President Obama's request to let insurers extend their current health policies, a decision that affects about 1 million Californians who have coverage that doesn't comply with the requirements of the federal health law.

The unanimous vote came at a meeting in Sacramento of Covered California's five-member board of directors. It means that the agency will retain its current policy that requires the 11 health insurers that sell coverage through the exchange to terminate individual policies that do not meet all the standards of the Affordable Care Act, known as Obamacare.

Obama made the request last week after millions of policyholders around the country received notice they would have to change policies despite the president's promise that anyone wanted to keep their health plan could do so. The controversy only added to the debacle surrounding the launch of the health law's federal website.

Covered California and health insurers officials had expressed concern that allowing people to keep their noncompliant plans would result in younger, healthier consumers staying out of the risk pool for the new state exchange. Attracting healthy, young people who would likely be infrequent health-care users is a key element in keeping overall costs down for other consumers in the exchange.

Some consumer groups expressed frustration at Thursday's decision.

"It's outrageous that this board would acknowledge that half of canceled policyholders will have rate hikes, then block them from continuing their coverage for another year," said Jamie Court, president of Consumer Watchdog, which is based in Santa Monica.

The action shows the agency is more on the side of insurers, "not the policyholders, by standing in the way of President Obama's call for action," Court said in a statement. "Shame on them."

The state exchange on Thursday also released more detailed demographic information about the enrollees.

Enrollment through Covered California has quadrupled in recent weeks and many of the enrollees are the so-called "young invincibles," or the younger people considered key to the survival of the new marketplace, according to the new data.

Of the 30,830 people who enrolled in October, the first month of the exchange, state officials said 6,900 – about 22.5 percent – were between the ages of 18 and 34, which is slightly higher than the proportion of that age group in California's population. About 21 percent of the state falls in that age group.

Covered California also released more updated enrollment numbers. As of Tuesday, nearly 79,900 people had enrolled in health plans through Covered California.

"Not only are we seeing strong enrollment numbers overall, but enrollment in key demographics like the so-called young invincibles is very encouraging," said Peter Lee, Covered California's executive director, in a statement.

Victoria Colliver is a San Francisco Chronicle staff writer. E-mail: [email protected] Twitter: @vcolliver


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