SACRAMENTO >> Ending two straight years of average 4 percent increases, the state’s health insurance exchange on Tuesday stunned consumers by announcing a 13.2 percent statewide average rate increase for those who buy 2017 health care plans through Covered California.
In Santa Cruz, San Benito and Monterey counties, the average rate hike of 28.6 percent is not only more than double the statewide increase, it once again is the highest in California.
Next highest in the Bay Area is San Francisco County, at an average 14.8 percent increase, followed by Contra Costa County at 13.6 percent.
Rate increases for the rest of the Bay Area fall just below that at 12.5 percent for Marin, Napa and Sonoma counties; 12.3 percent for Alameda County; 11.7 percent for San Mateo County and 9.2 percent for Santa Clara County.
“We’ve known for a long time that 2017 would be a transition year,” Peter Lee, the exchange’s executive director, said during a late morning press conference. “We are seeing that happening, just as we predicted.”
He blamed the increases on several factors, including rising prescription drug and health care costs, and the end of two federal “risk mitigation” programs created under Obamacare, which expire in 2017.
The programs protect insurers from major, unexpected losses from offering health insurance on the exchanges.
Lee also noted that “some higher than expected” health risk enrollees have come into the system.
Trying to assuage the rate shock, Lee said most consumers will pay less or see a rate bump of no more than 5 percent — but only if they switch plans.
Still, if the average rate hikes for 2017 are eye-popping across 19 regions of the state, they now appear to be more in line with the Bay Area rates than in past years.
For example, in Los Angeles County, where 2016 rates last year dipped 0.2 percent or inched up by only 2.5 percent, can now expect an average increase of 13.9 percent to 16.4 percent.
