Healthcare giant Kaiser Permanente is lowering its rates for Obamacare coverage in California by 1.4% next year, according to an industry report.
California’s health insurance exchange recently announced that premiums were rising 4.2%, on average, statewide for 2015 policies. A new analysis by Citigroup healthcare analyst Carl McDonald offers new details on what consumers can expect by company.
Kaiser was among the most expensive health plans in 2014 and staggered to a fourth-place finish in exchange enrollment. Anthem Blue Cross was the leader statewide, followed by Blue Shield of California and Health Net Inc.
“Kaiser doesn’t seem particularly happy with its exchange market share, as it is the only company reducing exchange premiums in 2015,” McDonald said.
Rates for Anthem Blue Cross, a unit of industry giant WellPoint Inc., are going up 4.6%, on average, according to Citigroup.
Blue Shield’s increases are 6% statewide and Health Net is raising premiums by 4.9%.
Despite those 2015 rates going in different directions, McDonald and other industry analysts are skeptical that Kaiser will gain much ground on its rivals. Even with the slight decrease, Kaiser’s HMO remains one of the more expensive options.
“There isn’t likely to be a material market share shift,” McDonald said in his analyst report. “Health Net’s products stand out as being by far the cheapest.”
Take Los Angeles, for instance.
In region 15, for a 40-year-old buying a silver plan this year, Kaiser was the highest-priced coverage at $297 a month. That’s before any federal premium subsidies based on a person’s income.
In 2015, that same silver plan would cost $287 from Kaiser. That’s still the second-highest price in L.A. behind an Anthem exclusive-provider-organization, or EPO, plan.
Next year, Health Net’s HMO remains the cheapest coverage on the silver tier in L.A. at $231 a month for a 40-year-old, up $7 from this year’s premium.
Those low rates made Health Net the market leader in L.A. with 33% market share, beating out Blue Shield and Anthem.
Those three insurers and Kaiser together accounted for 94% of Covered California’s initial enrollment of 1.4 million people under the Affordable Care Act. About 1.2 million actually completed the sign-up process and started paying their premiums, according to state estimates.
These rates are still subject to review by regulators before open enrollment for 2015 starts Nov. 15. The changes in premiums for each company also vary by region and the type of health plan.
Among the smaller, regional health plans, L.A. Care is boosting its HMO premiums by 11.3%, according to Citigroup research. That’s the biggest percentage change for any insurer in the state.