30% premium jump in California could signal national rise

Amid a heightened national conversation around the health reform law's impact on healthcare prices, a new study from California's agency creating its health insurance exchange shows individual premiums will likely rise an average of 30 percent.

The study, issued Thursday by Covered California, has national implications because California is leading the country in implementing the reform law's many provisions, particularly the online marketplace, The New York Times reported.

The findings come on the heels of a report from the Society of Actuaries, which predicted medical claims costs will increase 32 percent by 2017.

Helping drive healthcare prices is the reform law's guarantee of coverage for all consumers, including people with pre-existing conditions, plus requirements that insurers cover more benefits and preventive care, the study found.

"Health insurance will become relatively less expensive for people with chronic conditions and relatively more expensive for healthier people," Robert Cosway, an actuary at Milliman, which prepared the report for Covered California, told the Times.

Although middle-class consumers will see premiums rise, the reform law's new limit on out-of-pocket expenses will actually help temper the overall increase to their total cost of care, which the report says will grow by an average of 20 percent.

"It's hard to design any change of this scale where everybody is a winner and no one is worse off," Gerald Kominski, director of the UCLA Center for Health Policy Research and an expert on health insurance, told the Los Angeles Times. "Some people will feel they are being unfairly targeted or penalized."

In response to the report, Patrick Johnston, chief executive of the California Association of Health Plans, said most California consumers purchasing health plans through the exchange will benefit from more predictable, comprehensive coverage. But the report proves "lower cost sharing, richer benefits and more predictable coverage will come at a cost for some," he told The Wall Street Journal.

To learn more:
- read the New York Times article
- see the Los Angeles Times article
- check out the Wall Street Journal article

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