Premiums for health insurance sold through the state marketplace will increase by nearly 10% next year, the highest rate hike since 2018, Tuesday.
The projected 9.6% hike is the result of a 鈥渃omplicated time for health care,鈥� Covered California Executive Director Jessica Altman said during a media briefing, but many Californians will be shielded from the increases as a result of federal and state financial assistance.
About 90% of enrollees qualify for some type of federal or state financial aid and 20% will see no change in their monthly premium, officials said. About 1.6 million Californians turn to the marketplace for health insurance, which offers plans that cost as little as $10 a month.
The rate increase, however, represents the return of a troubling trend: , experts said.
鈥淲e鈥檙e seeing even larger increases in the private market. It鈥檚 worrisome,鈥� said Anthony Wright, executive director of Health Access California, a consumer advocate group. 鈥淚ndividual consumers need health coverage and they need help now.鈥�
During the COVID-19 pandemic, an influx of $3 billion from the federal government helped dampen the effect of rising health care costs in California. Covered California premium increases held below 2% between 2020 and 2022.
The federal government extended assistance for two more years, but the 2024 increase reflects post-pandemic inflationary pressures, such as , more people going to see the doctor, labor shortages and wage costs, Altman said.
The rate hikes vary by region, with more than one-third of enrollees potentially experiencing a double-digit increase, according to state data. Those who live in Mono, Inyo and Imperial counties may see the largest price increase at 15.8% compared to last year. Those same counties also experienced the .
鈥淲e鈥檙e glad that Covered California has federal and state subsidies to provide immediate help now, but we do need policy makers to double down on containing the costs of health care long-term,鈥� Wright said. 鈥淭his is a clarion call for the overall cost of health care going forward.鈥�
Covered California waives deductibles for many
Last week, the to implement a plan that will make coverage more affordable for about 650,000 enrollees by eliminating their deductibles for the coming year.
The vote capped a between Gov. Gavin Newsom, legislators and health care consumer advocates who have for repeatedly moving money intended for health care subsidies into the state鈥檚 general fund.
Under the plan, deductibles will be eliminated for individuals earning as much as $33,975 annually and families earning up to $69,375 annually. Previously, people with those plans paid deductibles of up to $5,400. The new plan also significantly reduces out-of-pocket copays for doctor visits and prescription drugs.
鈥淒espite the rate increase, Californians who enroll in health care coverage through Covered California will benefit from the greatest level of financial support ever offered鈥s we head into 2024,鈥� Altman said.
鈥楬efty鈥� health insurance increase
Christine Eibner, a senior economist with the RAND Corporation, a research and policy think tank, called the state鈥檚 projected premium increase 鈥渉efty.鈥�
鈥淭here will be some sliver of people who will have to pay the full cost,鈥� Eibner said. 鈥淎 lot of people are protected so maybe they don鈥檛 care, but who is paying? Ultimately it鈥檚 the taxpayer.鈥�
A significant number of people who are no longer eligible for Medi-Cal, the state鈥檚 public insurance program for very low-income individuals, also are expected to enroll in Covered California, which could drive future cost increases.
鈥淭hat population is relatively expensive,鈥� Eibner said. 鈥淧eople who are lower income have more health care issues, and bringing them into the market may lead to higher premiums.鈥�
The state paused during the federal COVID-19 public health emergency, but about 225,000 Californians have been kicked off since the state resumed monthly reviews this year. Covered California鈥檚 enrollment period runs from November through the end of January.
Supported by the California Health Care Foundation (CHCF), which works to ensure that people have access to the care they need, when they need it, at a price they can afford. Visit to learn more.