California picks insurers to sell health policies

Reed Abelson / New York Times News Service /


Published May 24, 2013 at 05:00AM / Updated Nov 19, 2013 at 12:31AM

California, widely seen as a model for how individuals will buy health insurance under the new health care law, announced Thursday that 13 insurers had been chosen to sell policies through the insurance marketplace — or exchange — being created under the law.

State officials said that rate increases for individuals who already had insurance would not be as high as some had feared. Blue Shield of California, for example, estimated its current customers would see rate increases of about 13 percent. Some estimates had suggested rate increases could be 30 percent. The increases are largely the result of higher prices and the need to cover people who now have no insurance and are likely to have expensive medical problems.

The new rates for individuals will be about the same — or lower — than the current rates for small businesses, according to officials from Covered California, the group operating the exchange.

“The changes in the market are really making individuals much more like employer groups,” Paul Markovich, the chief executive of Blue Shield, said. Like people who now receive health insurance through their employers, individuals buying policies on their own will be able to enroll next year even if they have a potentially expensive medical condition, and the policies’ benefits and premiums will be more standardized.

“We held insurers’ feet to the fire,” said Peter Lee, the executive director of Covered California, who said that the exchange had received interest from 33 insurers and actively negotiated with them over their proposed rates and the kind of network of doctors and hospitals they would offer.