California Community

California Leads in Lowering Health Insurance Premiums

Aimee Sharp
Author | Shield HealthCare
08/20/15  9:07 AM PST
Justin Sullivan/Getty Images

By Dan Gorenstein for Marketplace

Covered California Executive Director Peter Lee is wearing a big smile these days.

“We’ve turned expectations on their head and delivered affordable rates for all Californians,” he says. “That’s a big deal.”

Lee is excited because for two years in a row, premium increases on California’s healthcare exchange are about 4 percent – well below the 10 percent increases California consumers paid in the years running up to the Affordable Care Act.  That ranks among the top performances compared to other states that have released rates, according to industry group Avalere.

California does have an edge.

Insurers want to play in this lucrative pool, with two new companies signing up earlier this month. The state embraced Obamacare, giving Covered California a lot of authority most states declined to give their exchanges. That includes negotiating directly with the insurers.

Lee chalks up a chunk of their success to this power. But this is negotiating with a twist.

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