New Federal Regs Would Increase Premiums & Cost Sharing


Consumer advocates decried new regulations proposed this week by the U.S. Department of Health and Human Services which would increase premiums, deductibles, and cost-sharing for those enrolled in Covered California and other health insurance marketplaces across the country. These regulations, which are stated to “stabilize” the individual insurance market, would lower the “actuarial value” of plans, meaning greater costs for consumers. The 1.5 million Californians who get affordability assistance in Covered California could see reductions in the financial help they receive to afford premiums, and/or see increased deductibles and cost sharing for the 2018 plan year.

President Trump railed against rising health care costs and high deductibles during his campaign, and yet his first regulations are to attempt to increase those costs for consumers. No one voted for coverage that costs more and covers less–but that’s what these Trump regulations seek to do. All Californians should be concerned with these administrative actions and Congress’ rush to repeal Covered California subsidies and other Affordable Care Act benefits, especially without any replacement in place. These health care regulations are a giveaway to the insurance industry at the expense of consumers, literally, in the form of reduced affordability assistance and increased deductibles and cost-sharing.

Thankfully, some of these proposed changes, from the open enrollment period to network adequacy standards, are prevented by existing state law. We will work with the California Legislature and Covered California to further limit the impact of these regulations in our state, but Californians can’t be completely shielded from the negative impacts. Covered California’s 1.5 million enrollees have locked in their coverage and premiums for 2017, but they would be right to be concerned about the impact on costs that would start in 2018.

Moreover, these regulations are an indication that Congress should stop their rush to repeal that would be even more disastrous, not just for the 1.5 million who get coverage through Covered California now, but any one of the rest of us who might be thinking about starting our own business, retiring early, or otherwise needing the access and affordability assistance that the ACA provides when people don’t have coverage through an employer.

A fact sheet, “Covered California At Risk” details more about the potential impacts on Covered California and for those who rely on our state-budget marketplace.