During a special legislative session, the Senate and Assembly health committees held hearings to examine health-reform bills ABX1-2 (Pan) and SBX1-2 (Hernandez). Insurance Commissioner Dave Jones says he is concerned that these bills, which contain six- or 13 geographic rating regions could increase health insurance rates dramatically. “It is critical that the Legislature amend these bills to avoid an increase of up to 23% on hundreds of thousands of Californians in 2014,” he said.
An analysis by the Insurance Commission reveals that maximum increases could be 22.6% for the Legislature’s proposed six-region plan and 25.1% for its 13-region plan. However, the insurance commissioner’s office created an 18-region plan, which Jones said would only increase rates by up to 8%.
Jones offers the following analysis:
Geographic Rating Region Proposals Comparison
Six-Region Proposal:
• Maximum increase of 23%;
• Average increase of 9.1%;
• Areas that would see the greatest rate shock include all Counties north of Kern including the foothills, Monterey, and all of Northern California except the Bay Area and the Central Valley (up to 19%); Bay Area (up to 23%); and Los Angeles (up to 22%).
13-Region Proposal:
• Maximum increase of 25.1%
• Average Increase of 4.0%
• Areas that would see the greatest rate shock include greater Sacramento (up to 22.2%); the Bay Area (up to 21.5%); and Los Angeles (up to 25.1%)
18-Region Proposal:
• Maximum increase of 8%
• Average increase of 3.5%
• Far Northern California (8%) (Butte, Del Norte, Humboldt, Lassen, Mendocino, Modoc, Nevada, Plumas, Shasta, Sierra, Siskiyou, & Trinity)
• Eastern Central Valley and Foothills (6.7%) (Calaveras, Tuolumne, Mariposa, Madera)
• Northern Sacramento Valley (6.7%) (Lake, Tehama, Yuba, Yolo, Colusa, Glenn, Sutter)
