Jones Wants Anthem Out Of Exchange
California Insurance Commissioner Dave Jones can call healthcare premium hikes unreasonable, but he is powerless to stop them – an unending source of irritation since he took office 30 months ago.
Now, Jones is trying to get yet another state agency with more regulatory juice – the Covered California health insurance exchange – to actually do something about it.
At a press conference last week, Jones formally request Covered California to bar Anthem Blue Cross from offering covering in its exchange for small employer groups with 50 or fewer workers.
“I have determined Anthem has had a pattern or practice of excessive or unjustifiable rate increases,” Jones said at the conference. He cited three such rate hikes since the start of the year that raised rates on small employers a cumulative 28.7%. The most recent increase, for 7.6%, will go into effect next month.
“It's frustrating for me as the insurance commissioner, and it's frustrating for small businesses in California,” said Jones, who had deemed all three of the Anthem rate hikes as unreasonable.
Although Jones has been able to extract small concessions on rate increases from Anthem and San Francisco-base Blue Shield of California in the past, he has not been able to do so with the former's recent rate hikes.
Jones cited a section of the Affordable Care Act that could potentially bar any insurer from the exchange if it charges its enrollees unreasonable rates, but admitted it is out of his hands.
“It is up to Covered California to allow these companies to sell in the exchange, and I hope they will decide to exclude both Anthem and Anthem Blue Cross of California,” he said.
Covered California officials said they would consider Jones' request, but it would measure many other factors before it makes a final decision. Anthem is one of the 13 health plans that will offer benefits in the much larger consumer exchange, which is expected to draw 3 million or more Californians to purchase subsidized coverage. The business exchange is expected to attract fewer than 1 million enrollees.
Jones's actions drew both criticism and support.
The California Association of Health Plans, which lobbies on behalf of Anthem and other carriers, blasted Jones.
“Just a few weeks ago, when the exchange announced the plans that are participating in Covered California’s individual market, the insurance commissioner expressed concern about too few health plans participating, but now he is suggesting that choice should be limited for small businesses—this seems contradictory,” said the group's president, Patrick Johnston. “Restricting consumer options before we have the opportunity to see the rates, networks and other offerings presumes that consumers are unable to make the best choice for themselves.”
But Jones received some support from healthcare economists and consumer groups, noting it could better keep insurers in line.
