41 States — Including CA — Saw Their Deductibles Go Up Under Obamacare In 2016

The Affordable Care Act hasn’t just caused premiums to skyrocket across the country, out-of-pocket costs are also on the rise.

According to Freedom Partners, an Arlington, Va.-based conservative non-profit, 41 states are facing higher deductibles in 2016 – 17 of which saw a double-digit hike.

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Source: Freedom Partners’ 2016 Obamacare Deductible Increase Tracker

The states that saw the biggest spikes were Mississippi (39 percent), Washington (31 percent), South Carolina (26 percent), Louisiana (24 percent), Florida (23 percent), Minnesota and Vermont (22 percent), Arizona (21 percent), and North Carolina (20 percent).

The organization used weighted-averages of ACA plan deductibles across the country in to conduct their analysis and created a tool – the 2016 Obamacare Deductible Increase Tracker, which is set to unveiled Thursday morning – allowing users to see how their state measures up.

The findings show, on average, deductibles for Bronze, Silver and Gold plans bought through Obamacare exchanges increased by $265 –  an 8.4 percent rise.

“Higher Obamacare deductibles increase, by hundreds of dollars, what families must pay out of pocket to access their health insurance,” Freedom Partners Senior Policy Adviser Nathan Nascimento said in a statement. “Instead of reducing costs, Obamacare regulations and mandates continue to drive up these costs and make quality care less accessible for hardworking families.”

Just five states –Oklahoma, Texas, New Mexico, Illinois and Oregon – and the District of Columbia saw their average deductible go down, but even those regions all saw a rise in costs for Bronze plans.

Freedom Partners released a similar tracker for Obamacare premiums in January, which found all but one state saw an uptick in costs.

Originally published by the Daily Caller News Foundation

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Why Don’t California Lawmakers Want Residents to Buy Earthquake Insurance?

“California Rocks.” That’s the clever slogan for a new advertising campaign by the California Earthquake Authority (CEA), the state’s privately funded, publicly managed earthquake insurance fund. The message is both an allusion to the Golden State’s culture of musical cool and a literal statement of fact: California is earthquake country. The state experiences hundreds of tiny temblors every day that most people never notice. But it’s only a matter of time before a destructive quake rocks the Golden State. The Southern California Earthquake Center estimates that the state has a 99.7 percent chance of experiencing an earthquake of magnitude 6.7 or greater within the next 23 years. Yet, thanks to shortsighted public policy, only about one in ten Californian residents holds an earthquake-insurance policy.

Until recently, California’s insurers struggled to align their premiums with the actual peril that earthquakes represent. Insurance companies discovered after the 1994 Northridge earthquake that their estimates had been much too low. That magnitude 6.7 temblor killed more than 60 people, injured 9,000, damaged and destroyed thousands of buildings, and left parts of Los Angeles’s freeways in ruins. The losses suffered by insurers—$12.5 billion in all—were greater than the sum of earthquake insurance premiums they’d collected over the previous 25 years.

Politicians have always recognized that earthquakes pose a long-term problem, but their solutions have tended to be ad hoc and counterproductive. Two developments in particular made earthquake insurance less attractive to California homeowners. First, in 1985, the state took the unusual step of mandating that insurers offer earthquake insurance anytime they sell a residential insurance policy. At the time, an estimated 5 to 7 percent of homeowners had earthquake insurance. Publicly, legislators maintained that the goal of linking residential policies with earthquake policies was to raise awareness of earthquake insurance and encourage more people to purchase private coverage. But the underlying reason for the mandate was a state court decision that dramatically expanded insurer’s civil liability for damages not covered under existing policies.

The legislature had at least two choices in responding to the court’s ruling: take a free-market approach while limiting liability, or link the earthquake insurance to residential policies. Lawmakers went with the second, with the encouragement—later regretted—of some in the insurance industry. Insurers believed that most customers would turn down an offer of earthquake insurance, seeing it as an expensive option to hedge against a remote risk; meanwhile, the insurers would have insulated themselves from liability. In fact, the problem worsened: after Northridge, spooked insurers scrambled to limit their exposure to future quakes by refusing to sell residential policies. As a result, the real estate market ground to a halt.

In 1996, looking for a way to get insurers to issue policies again, legislators established the state earthquake authority, which offers earthquake insurance to satisfy the 1985 law. Participating insurers fund the CEA by pooling premiums in the state fund. The CEA’s earthquake insurance is better than what came before, but it’s still expensive, with high deductibles and limited coverage. So it’s unsurprising that only 10 percent of homeowners today are willing to pay for it.

The best way to control costs related to earthquake damage is to restrict development in earthquake-prone areas, but that opportunity passed long ago; the most dangerous areas in California are among the most densely populated. The most realistic and effective way to control earthquake exposure is to distribute the risk privately. Privately financed insurance policies aren’t susceptible to the political whims of state officials and regulators. They have the added virtues of scale, speed, and sensitivity to individual claims.

State senator Bill Monning, a Democrat from Carmel, has taken the lead on reforming the CEA and seeking ways to encourage more homeowners to buy insurance. But he’s found little support from his fellow Democrats. The best Monning could manage last session was a resolution encouraging Congress to pass the Earthquake Insurance Affordability Act, a taxpayer-funded insurance backstop. If lawmakers really wanted to see the public covered, they would liberalize the state’s insurance market and compel companies to innovate and compete. If they considered earthquake peril a statewide risk worthy of universal sacrifice, they might even make buying earthquake coverage a requirement for obtaining a mortgage, not unlike the mandate to purchase flood insurance in flood-prone areas. But until such changes come into effect, homeowners and taxpayers will wind up paying a steep price when California rocks again.

Report: Inaccuracies in Covered CA Doctor Lists

What good is medical insurance if you can’t find a doctor?

A recent investigation by the California Department of Managed Health Care found a quarter of the doctors listed in the provider directories for two of California’s top Affordable Care Act insurance plans either refuse to accept patients in the Covered California exchange, the state’s ACA implementation, or the doctors can’t be located.

“The inquiry was in response to numerous complaints the Department received from consumers who were having difficulty finding in-network physicians,” said the DMHC. “When contacted by the Department, a significant number of these physicians listed in the Plan’s network as participating providers indicated they did not accept Covered California enrollees.”

Nearly 13 percent of the physicians listed by Anthem Blue Cross as Covered California providers were not willing to accept patients enrolled in Anthem’s Covered California plans, according to a DMHC phone survey of 3,272 providers. Another 12.5 percent were not at the location listed in the provider directory.

Similar results were found with Blue Shield in another DMHC report: 8.8 percent of providers were unwilling to accept patients enrolled in Blue Shield’s Covered California products, despite being listed on the website as doing so. And 18.2 percent of the physicians were not at the directory’s listed location.

Some Californians have it worse than others. In 13 counties, fewer than half of Anthem Blue Cross’ Covered California providers said they accept Covered California patients, according to DMHC. That was the case for Blue Shield providers in 12 counties. The worst was Modoc County, where only 20 percent accept Blue Shield’s Covered California patients.

Making the situation even worse for those seeking affordable health care, 6 percent of the physicians who do participate in Anthem Blue Cross and Blue Shield Covered California plans are not accepting new patients, according to the DMHC.

Advertising

The department accused the companies of violating California Health & Safety Code Section 1360. It states: “No plan, solicitor, solicitor firm, or representative shall use or permit the use of any advertising or solicitation which is untrue or misleading, or any form of evidence of coverage which is deceptive.”

The companies’ Covered California insurance plans were cited for four deficiencies of the Knox-Keene Health Care Service Plan Act, which regulates HMOs in California:

  • “The Plan operated at variance when its internet website and online Provider Directory informed enrollees that numerous physicians were participating in the Plan’s Covered California products, when they were not.
  • “When the Plan failed to correct inaccuracies in its online Provider Directory, the Plan used (or permitted the use of) written or printed statements or items of information that were either untrue or misleading and which were disseminated, at least in part, for the purpose of inducing persons to enroll in the Plan.
  • “The Plan failed to meet its statutory obligation to provide enrollees with accurate contracted provider lists, either upon request, or through provider listings set forth on the Plan’s internet website.
  • “The Plan failed to submit a required Amendment filing to inform the Department of a greater than 10 percent change in the list of providers and to resubmit its updated provider list for re-review and approval.”

The first three deficiencies remain uncorrected, according to the DMHC report, and “have been referred to the Office of Enforcement for additional corrective action and other remedies as needed.”

Responses

The companies filed responses with DMHC, arguing the findings are flawed, overblown and based on inaccurate phone surveys. Their contracted physicians are responsible for inaccuracies in the directory if they don’t notify that they’ve moved to another location. And the companies said that any problems have been corrected.

“The Final Report drew several inaccurate conclusions based on unsupported assumptions and a fundamentally flawed research methodology,” argued Blue Cross in its response. “Most concerning is that even after being advised of the obvious problems with the survey’s findings, DMHC forged ahead with publishing its Final report.

“The unfortunate result is that the final report is likely to confuse and mislead consumers at a time when they are in need of accurate information in making their health care decisions.”

The company argued phone surveys have a “penchant for inaccuracy.” To ensure accuracy, the surveyor must first test a small sample and make adjustments before launching the full campaign. And it should include a subsample interviewed by a different interviewer to double-check the responses.

“Importantly, the interviewer should make every effort to speak with the person most likely to have the information sought, and record the title or role of the person interviewed,” Blue Cross said. “There is no indication in the Final Report that any of these basic protocols were followed.”

The company said it followed up with the physicians contacted by DMHC. Nearly half had “no recollection of any call from DMHC or its surveyors, with many saying such a call would have been referred to the individual with whom Anthem spoke, and that the provider’s office fully understands it is an Anthem provider.”

Blue Cross also charged the DMHC report is misleading because it assumed  physicians who had not updated their address information or did not respond to the survey or were uncertain whether they were in the Anthem plan “were by implication not Anthem providers. … [I]t appears the Final Report was written to confirm DMHC’s erroneous initial bias that Anthem’s Provider Directory had significant inaccuracies.”

Defense

Blue Shield’s response, while not as confrontational, made similar arguments in its defense:

“Blue Shield of California acknowledges and shares the Department of Managed Health Care’s concern about the network confusion that Individual and Family Plan members and our network providers experienced in 2014, due in large part to the implementation of the Affordable Care Act.

“We have worked hard over the last year to ensure that all of our members have an improved and positive experience in 2015. We are committed to continuing to work with the Department on our shared mission of serving Covered California members across the state.

“At the same time, we believe that the Department’s Final Report is misleading and has the potential to further confuse members by significantly overstating the severity of the issues. The vast majority of the issues raised in the Department’s report have either been corrected by Blue Shield or were never caused by Blue Shield in the first place.”

Blue Shield said it has more than 27,000 primary care providers under contract, with 96 percent “confirming they are accepting new Covered California patients.”

DMHC response

DMHC responded to Blue Cross’ criticisms:

“While the Department understands these concerns, they do not change the fact that the significant inaccuracies contained in the Plan’s online Provider Directory resulted in a highly unacceptable consumer experience, nor do they change the fact that California consumers could not reach or did not have access to providers who were represented as being part of the Plan’s network.”

The department acknowledged that Blue Shield is making corrections, but also defended the accuracy of its report’s findings:

“[T]he disconnect between the information provided to members and the actual status of providers within the Plan’s network has real potential for creating barriers to care. The divergence between the Plan’s online directory and the survey responses by provider offices listed in the directory creates confusion and access difficulties for enrollees.”

The DMHC was backed up by the California Medical Association, which represents more than 40,000 medical professionals. In a Dec. 8 letter to Covered California, CMA Associate Director Brett Johnson said the DMHC’s findings “unfortunately were consistent with our own findings.

“We have long been concerned with the state of provider directories in some of California’s largest health plans, and have conducted numerous internal surveys and analyses to this effect, some of which involved direct testing (e.g., calling practices to verify participation status) similar to that employed by DMHC.

“Despite criticism of DMHC in the plan responses for using telephone contact as the primary means of assessing a physician’s participation status, both directories audited in the report used directory disclaimers that instructed the enrollee to call or otherwise contact the listed provider to verify participation status.

“We believe, furthermore, this emphasis on point-of-service access appropriately places the responsibility for clear communication, comprehensible administrative policies, user-friendly information updating processes, and unambiguous contracting, among other things, in the hands of those best equipped to do something about it, the health plans, as opposed to relying primarily on DMHC to have the capacity required to effectively police the vast documentation this entails.”

However, the CMA did agree with the companies “that miscommunications and misunderstandings were the likely cause of a significant percentage of DMHC’s reported inaccuracies and failures to verify participation, and we further agree that, in such instances, physicians have a role in confirming participation status and ensuring that demographic data remains current.”

Recommendations

Johnson’s letter submitted three recommendations for Covered California’s consideration:

  • “Foster improved collaboration among providers and health plans to improve communication, the contracting process, and the means by which demographic information is verified and updated.
  • “Using Covered California’s authority as an active purchaser, require that providers’ participation in reduced networks be only obtained via a separate, affirmative assent.
  • “To achieve greater network transparency and improved directory reliability, continue encouraging and pursuing consumer-friendly technological improvements, such as creating an interface between health plan network management systems and a Covered California cross-plan directory.”

At the Dec. 15 Covered California board meeting, Executive Director Peter Lee said, “I applaud and appreciate CMA’s approach and recommendations. Getting directories right is a problem and challenge for both doctors and health plans. We will address that issue.”

This article was originally published by CalWatchdog.com