The board of Covered California has decided to keep established health insurers from using the exchange to sell coverage exchange statewide in 2016.
Board members voted Thursday to let newly licensed insurers to sell coverage through the exchange anywhere in the state, but to let established insurers enter only in regions with few coverage options.
The board of the state-based Patient Protection and Affordable Care Act (PPACA) exchange attracted insurers to the program in 2014 by saying insurers would have to participate in 2014 to have a slot in 2015. Exchange officials now say they want to keep newcomers that made a conscious choice to stay out of the market in 2014 from barging in next year.
An executive from UnitedHealth Group Inc. (NYSE:UNH) had sent the board a letter asking for a chance to sell coverage in California statewide in 2016.
Meanwhile, Anthony Wright, the executive director of Health Access California, and Wright joined with Sara Flocks, a representative from the California Labor Federation, to ask the board to shut out any carrier that sells “skinny plans” — health plans for large employers that cover less than 60 percent of the actuarial value of the PPACA essential health benefits package.
“We seek a requirement that participating qualified health plans that offer large employer coverage do not offer coverage to large employers that is less than 60 percent minimum value,” Wright and Flocks write in one of the letters.
Wright and Flocks included an attachment of a UnitedHealthcare slidedeck illustrating how an employer could offer workers a choice between one plan that provides 60 percent of actuarial value and a second plan that covers only the PPACA preventive care package, or the PPACA preventive care package and two sick visits.
In the slidedeck, UnitedHealth care says the preventive services package would help workers satisfy the PPACA individual coverage mandate but might affect their eligibility for PPACA exchange plan premium subsidies. The company notes that, in 2015, an employer subject to the PPACA mandate will have to offer coverage with a 60 percent of the actuarial value of the EHB package to just 70 percent of its full-time employees.