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This rate hike is the largest California has seen since 2019. In the last three years, insurers had kept average increases under 2%.
Rate changes vary by region — from an 11.7% increase in Imperial, Inyo and Mono counties to zero change in Fresno, Kings, and Madera counties.
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When premiums increase, an individual’s financial aid usually does, too. Aid is based on household income, so subsidies may offset some of the increase. But people who don’t qualify for subsidies will bear the full cost of the rate hike.
“Premiums are a capturing of what health care costs are, how they vary across geographies and communities, how health care costs are growing over time, which we know in this country are already too high and rising,” said Jessica Altman, executive director of Covered California.
She noted that California’s rate hike is still lower than it is in other states. A recent Kaiser Family Foundation analysis found a 10% average premium increase proposed by 72 insurers in 13 other states.
The rate increase, Altman said, is largely attributed to people resuming doctor visits and procedures that they were postponed during peaks of the COVID-19 pandemic. There is also the cost of general inflation.
About one percent of the increase, however, is attributed to the potential loss of enhanced subsidies from the federal government, which are set to expire at the end of this year. Without the additional aid, people will pay more for their premiums, likely pushing young, healthy people to drop their coverage. And when healthy people leave the marketplace, premiums go