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Covered California and CHBRP warn EHB expansion could raise premiums as federal subsidies remain uncertain
Summary
Presentations from the California Health Benefits Review Program and Covered California highlighted estimated per‑member premium impacts for candidate benefits and warned that loss of federal premium subsidies would compound consumer cost increases and cause enrollment declines.
Two panels at the joint Assembly and Senate health hearing focused on premium impacts and market implications of adding benefits to California’s EHB benchmark.
Why it matters: Covered California insures nearly 2 million consumers and most enrollees receive federal premium assistance; even modest premium increases can reduce enrollment, change the risk pool and raise premiums further.
CHBRP findings: Darren Corbett of the California Health Benefits Review Program summarized a two‑week CHBRP analysis intended to be expedient. CHBRP produced silver‑plan PMPM illustrative estimates: hearing aids at about $1.52 PMPM; wigs/cranial prosthesis about $0.31 PMPM; chiropractic about $0.78 PMPM; DME (including CPAP and mobility aids) around $1.64 PMPM; augmented communication devices $0.03 PMPM; neuromodulators $0.01 PMPM; and infertility (CHBRP’s SB 729 scenario) $5.36 PMPM. Corbett cautioned the figures assume no baseline coverage and do not model how subsidies or changes in enrollment might alter premium impacts.
Covered California perspective: Doug McKeever, chief deputy executive director for programs at Covered California, framed the discussion through affordability and access. He told the committee Covered California had not yet modeled the issuer‑level premium impacts for the candidate benefit packages: "As of today, we have not done an assessment financially of what the premium impact will be if, any or all of the considered benefits are included." McKeever warned that federal enhanced subsidies are scheduled to expire and that reductions in federal assistance would push many consumers to drop coverage; he and staff said loss of subsidies could produce large enrollment declines (Covered California has estimated possible loss of up to ~400,000 enrollees if enhancements expire) and steep premium increases for different income groups.
Policy tradeoffs: Covered California staff stressed the combination of subsidy uncertainty and any premium increase from EHB expansion could disproportionately affect lower‑income and communities of color. McKeever recommended careful balancing: coverage gains versus consumer affordability and exchange stability.
Unresolved items and next steps: Committee members asked whether the state could use existing state funds to offset premium increases. Covered California said any state fund would be insufficient to replace federal subsidies and that state funds could help mitigate premium increases only if federal assistance remained in place. Covered California and CHBRP urged more time for issuer‑level rate modeling; both said such modeling takes additional time beyond the tight May filing window.
Ending: The agencies recommended the Legislature factor federal subsidy uncertainty into any decision to expand EHBs and to seek additional actuarial detail and insurer rate models before selecting a final package for a CMS filing.
