Maribeth shannon july 2 2014 informational hearing
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Maribeth Shannon July 2, 2014 Informational Hearing PowerPoint PPT Presentation


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Maribeth Shannon July 2, 2014 Informational Hearing. Health Care Costs Overview. Health Spending Has Been Historically Volatile. ….and has always outpaced inflation rates. Average Annual Growth Rates in Health Spending United States, 1962 to 2012.

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Maribeth Shannon July 2, 2014 Informational Hearing

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Maribeth shannon july 2 2014 informational hearing

Maribeth ShannonJuly 2, 2014Informational Hearing

Health Care Costs Overview


Health spending has been historically volatile

Health Spending Has Been Historically Volatile

….and has always outpaced inflation rates


Average annual growth rates in health spending united states 1962 to 2012

Average Annual Growth Rates in Health SpendingUnited States, 1962 to 2012


Ca health spending as a share of the economy lower than u s average

CA Health Spending as a Share of the Economy Lower than U.S. Average….


But ca employer based premium rates are higher

……But CA Employer-Based Premium Rates are Higher

Source : CHCF Employer Benefits Survey, 2013


Esi premium increase compared to inflation family coverage california 1999 to 2013

ESI Premium Increase Compared to InflationFamily Coverage, California, 1999 to 2013

Introduction of

Rate Review


Individual market premium rate increases existing products 2011 to 2014

Individual Market: Premium Rate Increases Existing Products - 2011 to 2014


Regional differences in premiums in covered california

Regional Differences in Premiums in Covered California

Silver Plan, single 40 year old, $75,000 income

Avg. $381

Avg.$258


Difference in hospital payments

Difference in Hospital Payments

OSHPD - Net Revenue Per Adjusted Patient Day (Third Party)

$7,740

$4,292


Aca provisions likely to increase premium rate growth

ACA Provisions Likely to Increase Premium Rate Growth

  • Expansion of coverage

    • Guaranteed issue

    • Children covered to age 26

  • Prohibitions on lifetime limits

  • Mandated benefits

  • Increased demand for services


Aca provisions likely to decrease premium rate growth

ACA Provisions Likely to Decrease Premium Rate Growth

  • Medical Loss Ratio Limits

  • Standardized Actuarial Value (Metal Levels)

  • “3 Rs”

    • Reinsurance

    • Risk Corridors

    • Risk Adjustment

  • Other: Delivery system changes, comparative effectiveness, etc.


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