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Monday, October 24, 2016

by Charles Ornstein, ProPublica.

There’s good news flowing from the Golden State — and Peter Lee has a lot to do with it.

Covered California, the state’s health insurance marketplace, signed up more people in October than, the federal website handling enrollment for 36 states.

During that month, 30,830 people enrolled in Covered California. By comparison, in the states that relied on, fewer than 27,000 people enrolled from Oct. 1 to Nov. 2.

“California’s Health Insurance Exchange Enrollment Says a Lot About What Could Have Been and What Still Has To Happen,” wrote insurance consultant Robert Laszewski.

“Calif. Offers Glimmer of Hope Amid Disastrous Obamacare Rollout,” wrote Real Clear Politics.

Lee, Covered California’s executive director, has set the tone for the exchange, traveling around the state to help promote it. Prior to being named to his position in 2011, he served as deputy director for the Center for Medicare and Medicaid Innovation at the Centers for Medicare and Medicaid Services. He was also the longtime executive director and CEO of the Pacific Business Group on Health in San Francisco.

I spoke to Lee on Tuesday to talk about what California is doing right and wrong — and what’s ahead. The interview has been edited for length and clarity.

Q. Covered California is being cited as a model for what could have been if it got its act together. Do you agree?

A. Yes and no. We’re hardly perfect, and I’m not ready to declare success, but I’d say absolutely we’re in the game in a very positive way. When I think about what it takes for an exchange to be successful, it’s three things. It’s affordable products. It’s effective marketing and outreach and then effective enrollment. I think we’re doing pretty well on all three fronts. And on the enrollment side, it’s not just that we have a good functioning website. Literally we’re in the process of having upwards of 30,000 trained people across the state to help people enroll in person. That’s huge. I don’t have the hubris to say we have all the answers or we’re doing everything right, but in many ways, I think, we have our act together.

California, with a Republican governor (former Gov. Arnold Schwarzenegger) and a Democratic legislature said, we’re going to set up an exchange that’s going to work as well as humanly possible for California consumers, and we’ve been working on that for the past two and a half years. And what we’re seeing today is the result of saying, “Let’s put our residents first.”

Q. It seems, based on the numbers you released last week, that Covered California is hitting its stride, with some 2,000 enrollments a day. Do you consider this a peak? And if not, what is your best guess of what a peak may look like?

A. It’s absolutely not the peak. I think that the peak is going to be in the period from Dec. 1 to Dec. 15 [the deadline to sign up for coverage that begins Jan. 1]. And I would anticipate we would be on a daily basis easily doubling, tripling, if not quadrupling, enrollment numbers from 2,000 a day. When you think about marketing and sales, generally you say that for most consumers, they need to be touched 10 times before they buy something. We’re selling insurance. We’re selling it with a financial subsidy. But even with that subsidy, consumers have to decide—it’s a purchase they’re making.

The people who enrolled in October are what I like to call ‘one touch people.’ These are people who’ve been waiting to get health insurance forever, who’ve said, ‘I’m going to jump on it.’ I think we’re far from peaking. We’re just starting the discussions around the country to get people talking about shopping and comparing their options.

Q. The issue of health insurance cancelations has received a lot of attention, including in California. My understanding is that contracts between Covered California and insurers offering products on the exchange requires that they cancel non-grandfathered policies that aren’t compliant with the ACA by Dec. 31. Why is that?

A. The plans wanted it in place because what they and we were worried about was that some plans would be selling in essence schlock coverage in November and December of this year. That would have a lot of [insured people] going through much of next year, which would have very substantially negative impacts on the risk pool, potentially leading to a much higher cost for lives in Covered California. We believe, and I believe rightly, that the products we are offering are good products at good prices.

Q. Given the president’s request that insurers allow consumers to renew these policies, will you change your approach?

A. We’re looking and will be talking with our board this Thursday about whether we should be making any change in what was a policy designed for the good of consumers. Clearly for those who don’t have insurance, there are millions who get subsidies for buying products. Let’s look at the 1.7 million people [with individual, non-group insurance policies in California]. About 800,000 of those are in grandfathered products, meaning they were issued before March 2010 [and consumers can keep them under the law]. About 900,000 are in non-grandfathered plans. Of those, about 300,000 are eligible for subsidies and will get a big leg up. Which leaves about 600,000. Some will see their rates go down; some of those who will see rate increases. There are two types. Some are individuals covered right now with what many would say is high-risk coverage. Coverage that is inexpensive because it won’t be there when you need it. There are also some people, it’s probably 100,000 to 200,000, who probably have pretty good coverage today that to get comparable coverage with their existing health plan are seeing rate increases. There will be some people who have price bumps. That is unfortunate. It’s always been the case that some individuals are going to see costs go up because we’re moving from a health insurance marketplace that is about risk selection and avoiding sick people to one that is about good health benefits for everybody.

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  • Lynda Groom

    Our daughter, son-in-law and grandchild have just finished the process with the California exchange. They will be paying a little more than half of what they were quoted last year in the pre-ACA marketplace.

    • sigrid28

      We are working on my son’s ACA enrollment here in Iowa. Our website is federal and working well. But there are some shortcuts to making the process work well. My suggestions also have to do with maximizing enrollment numbers so we can see the ACA thrive by silencing its critics early on in the process. I want to suggest that we get all of our children and grandchildren enrolled for the holidays: give them something that will last their lifetimes.

      1. Most important of all, HELP your child or grandchild with the sign-up, even paying for the first month if necessary. These initial numbers are VITAL to the success of the program, and one policy can be dropped to pick up another later in the enrollment process. This two-step process can even result in one individual boosting the numbers twice! Or, heaven forbid, a policy held for a month or two can be dropped if circumstances change.

      2. ACT NOW. Uninsured families and individuals must apply and pay the first premium by December 15th to be covered as of January 1st. It could take 24 hours for the system to process the application. Only then can you pick a policy. Next, you must contact the insurer to arrange payment. All before December 15th.

      3. Don’t ask to see the paperwork by mail, as it takes four to six weeks to arrive. If you or the person you’re helping have questions, call the ACA phone reps who are very deft at getting you back on track on the website. Be patient! I was on the phone two hours helping my son, who is computer savvy.

      4. If a young person with low income is rejected at first for a subsidy or tax credit, APPEAL the decision but do not wait to buy a policy. Buy a low-cost catastrophic policy right away, and then see what happens to the appeal (which can take sixty days). If the young applicant wins the appeal, he or she can then upgrade, drop the less expensive policy, and buy a better one. Once again, this procedure gives ACA statistics a two-for for one individual. Incidentally, learning how to navigate appeals for benefits is a skill most people need for government applications of all kinds: Medicaid, VA benefits, SSI, SNAP, unemployment compensation, you name it. This problem has a silver lining, as it teaches young people how to advocate effectively for themselves and their families.

      • elw

        Good advice. One thing insurers hate is the word “appeal.”

    • elw

      California is always ahead of the other States when it come to healthcare. We have it down. Good to hear a positive ACA story.

  • mandinka

    My premiums in CA just tripled from the policy I had last year. I no longer can afford insurance