California’s insurance marketplace, Covered California, will open in October, 2013. People will be able to buy insurance, which will take effect January 1, 2014.

The state’s health insurance exchange, Covered California, announced Thursday morning the plans and premiums that will be available to people statewide to millions of Californians.

And what everyone wants to know is: how much will it cost. Experts had warned of “rate shock,” that premiums might skyrocket for all kinds of reasons. That has not happened.

Covered California says that individuals will pay an average premium of $321 per month for a “silver” plan. (More on silver plans below.) Many people will be eligible for subsidies to reduce that cost further.

Across the state, people who had been working toward this day seemed to heave a collective sigh of relief.

“This is a home run for consumers in every region of California,” said Peter Lee, executive director of Covered California, in a release to reporters. “Californians should be proud of how not only health plans in this state, but doctors, medical groups and hospitals have stepped up — creating a market that will allow millions of consumers to enroll in affordably priced products.”

The plans on the exchange are required to offer a standard set of comprehensive benefits. It’s hard to compare premiums next year to what’s in place this year, since there is no standard set of benefits at present. Covered California chose as the best comparison the average premium for a small business plan. The rates in Covered California range from 2 percent above to 29 percent below that benchmark.

“It’s nice to have a good news day in California,” said Daniel Zingale, senior vice president of The California Endowment. “It turns out there’s power in numbers when it comes to … health plans.”

The selected plans and premiums are still subject to review by state regulators. Covered California has picked 13 plans, including Anthem Blue Cross, Blue Shield of California, Health Net and Kaiser as well as many regional plans and local Medi-Cal plans. Those include Alameda Alliance for Health, Chinese Community Health Plan, Contra Costa Health Services, L.A. Care Health Plan, Molina Helathcare, Sharp Health Paln, Valley Health Plan, Vnetura County Health Care Plan and Western Health Advantage.  You can look up your own region and see what plans and premiums you can choose from.

Plans will be offered in tiers of coverage: platinum, gold, silver, bronze. The platinum plans have the highest premiums but you will pay less when you see the doctor; the bronze plans have the lowest premium, meaning you will pay more when you see the doctor.

The “silver” plan mentioned above is in the middle. It has the same standard set of benefits as the other plans, and has a $2,000 annual deductible. Still, preventive care and some other services are outside the deductible — people would pay only a co-pay when they see the doctor.

When setting an individual’s premium, insurance plans in the exchange may look at only three factors: age, where you live and family size. Insurance companies may no longer use your health condition or your health history to set premiums. People may no longer be turned down for pre-existing conditions.

Subsidies are available for people making from 138 to 400 percent of the federal poverty level – or about $15,500 to $45,000 for an individual.

Covered California provided tables of average rates for a 21-year-old and a 40-year-old single person. For the 21-year-old buying the most affordable silver plan, the premium is $216 per month. But depending on income, the 21-year-old may get a subsidy, making the price that person would pay range from $44 per month to $216 per month.

The premium for a 40-year-old buying the most affordable silver plan will be $276. But depending on the subsidy, that 40-year-old will pay from $40 to the full $276.

Starting this fall, people will be able to go online and look up plans and rates across the board for themselves or their families.

“Everything will be quite standardized and literally charted out,” said Betsy Imholz, special projects director for Consumers Union. “So you can look across lines and compare plans.”

On average, people in the larger metropolitan areas in California will be able to choose from among five different plans. Covered California says that even in rural areas where options have typically been sparse, people will have two or three health plans to choose from.

“We were particularly concerned about Californians in rural parts of the state,” Zingale said. “So it’s a relief to see that they will have doctors, hospitals and health benefits available in those areas.”

But not everyone was delighted. Jay Nelson is a 33-year-old attorney who lives with his wife and three children in Oakland. Nelson does not get insurance at work and has been unable to afford it for his family. He said he was disappointed the premiums are not cheaper.

“We’re exactly in that income level that is essentially uninsurable,” he said. “We make too much money to qualify for any help, but we don’t make enough money to pay for this … comfortably.”

Bacchi acknowledged that while the Covered California premiums are generally “positive news,” that’s not the case for everyone. “The reality is that there are some people who will pay more than they currently pay. That’s because the Affordable Care Act requires increased benefits and it also imposes less cost sharing on the enrollee through deductibles and co-pays.”

Plans and premiums for Covered California’s small business exchange are expected to be announced in June, and a major education and outreach campaign will launch this summer.

(Justin Sullivan/Getty Images)

Gov. Jerry Brown’s revised budget plan is a mixed bag for health advocates and some county officials.

Brown said the state would take the lead on a key provision of the federal health law — expanding Medi-Cal to more than one million Californians. Brown scrapped earlier plans to consider a more complicated, county-based system.

But Brown anticipates recouping more than $300 million from the counties next fiscal year – money that pays for public health programs and care for the uninsured. Brown’s rationale? With the full implementation of federal health reform next year, more people will enroll in Medi-Cal and fewer people will show up to county emergency rooms.

Farrah McDaid Ting with the California State Association of Counties says Brown’s proposal makes no sense. She says plenty of people will still rely on county services in 2014.

They are “people who qualify for Medi-Cal but don’t sign up, people who have a hard time signing up or staying on programs, the undocumented in our communities and those who are in between private health plans,” McDaid Ting said. “We need to retain enough funds to serve those people.”

That could be 3 to 4 million Californians who remain uninsured even after federal health reform is fully implemented, according to projections from UC Berkeley and UCLA. Brown and state health officials say they are developing a “mechanism” that will determine county savings based on real data.

Advocates fanned out across California Tuesday holding five statewide rallies, including one in front of state offices in Oakland, where they called for a rollback of cuts to adult dental care, children’s nutrition programs and other social services.         

“I think the most important number to remember is that one in four children in California are in poverty now,” Jamila Edwards Harris with the Children’s Defense Fund said. “And that number has only risen since budget cuts over the last five years.”

Brown’s budget also continues pending cuts to Medi-Cal providers, a plan that has been tied up in federal court since it passed in 2011.

By Kelley Weiss, CHCF Center for Health Reporting

Tax credits for small businesses offering health insurance have been available since the health law was passed in 2010. (Photo/Getty Images)

With less than a year to go before the full rollout of Obamacare, many business owners are still scratching their heads over what it will mean for them.

In fact, most still wrongly believe they’ll have to offer health insurance to their employees, according to a recent eHealth survey. While businesses with 50 or more full time employees will have to pay a $2,000 penalty per worker if they do not offer health insurance, there is no penalty for smaller businesses.

Another commonly misunderstood part of the health care law is the role of the tax code. John Gonzales [also with the Center for Health Reporting] has more details about how paying your taxes and Obamacare works. It’s the bedrock of enforcing the law and subsidizing premiums for people to buy insurance.

At an event about taxes and Obamacare, UCLA health care economist Dylan Roby gave a somewhat grim picture. He says widespread ignorance and varying degrees of hostility towards the health care law persist among business owners.

“Many of these employers, especially on the smaller level, are not that great about maintaining a relationship with the government,” Roby says.

Take, for example, the small business tax credits that have been available since 2010, when Obamacare passed. The U.S. Government Accountability Office last year estimated that less than 5 percent of eligible businesses have claimed the credit. This isn’t a big surprise to Larry Levitt of the Kaiser Family Foundation.

“It’s about as exciting as picking health insurance and doing your taxes and that’s what we’re combining here,” Levitt says.

These business owners are potentially leaving money on the table. If you’re a small business owner who has been offering health insurance at any point since 2010, you may qualify for a tax credit. You can file a revised tax return to collect it.

Another break for businesses trying to purchase health insurance for their workers could come from the new “marketplace” called Covered California.

This state-run exchange is supposed to even the playing field for small businesses that can pay almost 20 percent more than larger ones for health insurance. Currently a little under half of California’s small businesses offer health insurance to their employees.

On the flip side, those $2,000-per-employee penalties for large businesses that don’t offer health insurance start next year. But this will affect less than 5 percent of businesses. That’s because in California, and nationally, most businesses are considered small, meaning they have fewer than 50 employees.

Allan Zaremberg, head of the California Chamber of Commerce, says it’s a daunting task for businesses to keep the carrot and stick aspects of Obamacare straight.

“There is a heck of a lot of confusion about tax credits and costs and do I put him in the exchange or take the penalties,” Zaremberg says.

Allan says he’s not convinced the stick approach will work with businesses. He says they’ll be weighing if taking a couple thousand-dollar penalty per employee for not offering coverage would actually be cheaper.

“I’m not always sure that you can scare them with a monetary penalty. And certainly for a small employer there is none,” Zaremberg says.

Now the push is on to educate businesses about the potential benefits of Obamacare. USA Today and Kaiser Health News report that California has budgeted about $250 million to help consumers, including small businesses. But few experts are saying it’ll be easy.

The health care overhaul is “a big complicated piece of business,” President Obama told reporters during Tuesday’s news conference. (Alex Wong/Getty Images)

If you’re one of the millions of people confused about Obamacare, the president took a few minutes on Tuesday to reiterate his main messages about the federal health law.

“For the 85 to 90 percent of Americans who already have health insurance, they’re already experiencing most of the benefits of the Affordable Care Act even if they don’t know it,” the president said.

He called insurance “stronger, better, more secure,” for people than before the law’s passage. ”Full stop. That’s it. Now they don’t have to worry about anything else.”

President Obama specifically mentioned three benefits of the ACA already in place:

• Children can stay on their parents’ plan until age 26
• Your insurance company cannot drop you if you get sick
• You get free preventive care with no co-pay and no deductible (including many cancer screening tests)

The law also has banned lifetime caps on coverage. For people who have employer-based insurance or Medicare, most of the changes required by the law are already in place.

For people who do not have insurance — or who buy insurance for themselves or their families — “implementation issues” remain, the president said.

“… What we’re doing is we’re setting up a pool so that they can all pool together and get a better deal from insurance companies,” the president said. “And those who can’t afford it, we’re going to provide them with some subsidies. That’s it. I mean, that’s what’s left to implement because the other stuff’s been implemented, and it’s working fine.”

But the challenge in setting up that system is “still a big complicated piece of business,” he acknowledged.

A big complicated piece of business indeed.

It’s been three years since California became the first state in the country to pass legislation to set up a marketplace, now called Covered California. Covered California has been moving full steam ahead, but  the clock is ticking down rapidly to Oct.1 when the online marketplace must open for people to begin shopping for insurance. Coverage will start on Jan. 1, 2014.

“Glitches and bumps” ahead

The president was clear there’s still a long ahead. “And the last point I’ll make,” he said, “even if we do everything perfectly, there’ll still be, you know, glitches and bumps, and there’ll be stories that can be written that says, oh, look, this thing’s, you know, not working the way it’s supposed to, and this happened and that happened. And that’s pretty much true of every government program that’s ever been set up.”

The president’s remarks came on the same day that a new poll showed some troubling gaps in the public’s understanding of the law.

More than 40 percent of Americans are unaware that the ACA is still the “law of the land,” according to the poll conducted by the non-partisan Kaiser Family Foundation. And just under half of Americans say they so not understand how the law will affect themselves or their families.

Dr. Kathleen Clanon talks to patient Andrew Solis about keeping his HIV under control. Clanon worries her patients will have disruptions in their care if they don’t navigate the changes coming under federal health reform. (Mina Kim/KQED)

A major goal of the federal health care law is that millions of people who currently do not have health insurance will have improved access to care. But the massive overhaul is also expected to be widely disruptive, and doctors worry that many people with chronic illness could suffer during the changeover, as KQED’s Mina Kim details today on The California Report.

Kim tells the story of 33-year-old Andrew Solis who stopped taking HIV medications more than a year ago after becoming addicted to methamphetamine while in a “rocky relationship.” He resumed treatment at the Oakland Highland Hospital HIV clinic last October after ending the relationship.

Solis has been able to get back in to treatment fairly easily, Kiim reports. But changes coming under the Affordable Care Act could complicate care for clinic patients, says Kathleen Clanon, chief medical officer at Highland Hospital.

From Kim’s report:

“They are all poor basically. It’s been 15 years or so since HIV was really a disease in the U.S. of middle-class men. It’s been a disease of poverty in the U.S., really, for about 15 years now.”

Right now, low-income patients without insurance get their health care paid for by the federal Ryan White program which only covers HIV related care. In order for them to get the full benefits of the Affordable Care Act, they’ll need to move to a more traditional insurance-based care. For starters, they’ll have to first choose an insurance carrier and a primary care doctor and Clanon says, that won’t always be easy.

“Most of the information that goes to people about their choices and how they’re becoming insured is going to come by snail mail, and people who are low-income frequently don’t have stable addresses, and the majority of my patients don’t have regular access to the internet.”

If her patients don’t fill out the paperwork, they will be automatically assigned to a primary doctor — one that Clanon says is unlikely to have a specialty in HIV care. Or worse, she fears her patients won’t tell their new doctor that they’re infected, because of stigma surrounding people with the virus.

“I have a patient that I saw about a month ago, he needed to move in with his mom. However she was so afraid of him that she was making him eat in his room off paper plates that she would then throw away. So stigma will make it difficult for people to fix any weirdness that happens in terms of where they get assigned.”

And people with HIV, Clanon says, don’t have time to be away from treatment.

“Within a week, ten days, two weeks, if you stop taking your HIV medication, the virus comes back. And treatment interruptions are dangerous for people with HIV, they’re dangerous for their health, and they’re dangerous for our whole community because during that time that person is infectious to others.”

Still, the Affordable Care Act earmarks money to deal with all that paperwork. Covered California, the state’s new health insurance marketplace will soon announce grants totaling $49 million for education and outreach. Much of the money is expected to be awarded to community groups which have extensive networks in ethnic and low-income populations — the very people who might have the most trouble navigating the new system.

The primary goal of that outreach is simply to get people enrolled in a health insurance plan. But Dana Howard, a spokesman with Covered California says these “assisters” will also be charged with helping people directly. “Assisters are there to say, ‘Let’s figure out who you’re seeing. Let’s find a plan that has your network in there and find the one that has the best price,’” Howard described.

Anthony Wright of Health Access, a statewide consumer advocacy group, was a bit more circumspect, saying, “that is the hope” when asked if assisters would help make sure people made it into a plan that includes their current doctor.

In the meantime, Dr. Clanon is moving ahead on her own, Kim reports. Two staff members at Highland’s HIV clinic are becoming experts in the Affordable Care Act. They’re also working with insurance plans to make sure that one of their HIV/AIDS doctors can be listed as a primary care provider.

Again, from Kim’s report:

Clanon says her clinic is ahead of the game, but she worries about clinics in rural areas or clinics with fewer resources. To help them along, Clanon’s been traveling up and down the state talking with other HIV providers about ways to prepare for health reform.

This post has been updated to include a quote and information from Dana Howard of Covered California. It also corrects the amount of money to be granted for education and outreach.

(Getty Images)

As we’re barreling along toward Jan. 1 and the full implementation of Obamacare, it seems that questions of ethics are embedded in just about every discussion of the practice of medicine and how it will change in the coming years. San Francisco’s Commonwealth Club asked me to explore the issue recently by moderating a discussion featuring three prominent Bay Area physicians that the club had invited to participate.

The formal title of the event was “Improving the Ethics and Practice of Medicine,” but pretty quickly money came right into play.

He talked about “appropriate stewardship” of limited resources in considering both the health of the individual and the health of broader populations.

But being a good steward creates conflict for the doctor in the treatment room, argued Dr. Victoria Sweet, who practiced for 20 years at Laguna Honda Hospital. She is also a historian and author of the book “God’s Hotel: A Doctor, a Hospital and a Pilgrimage to the Heart of Medicine,” where she writes about the concept of what she calls “slow medicine.” How can a doctor be both a steward to his patient and a steward of the nation’s health care resources? “I can’t believe how stressful these … often opposing ethical imperatives are for a doctor,” Sweet said.

Disruptive changes necessary

To reconcile those opposing imperatives (and righting much about what’s wrong in American health care), we need a restructuring of the whole system, argued Dr. Robert Pearl, CEO of Kaiser Permanente Medical Group. He said this restructuring goes beyond Obamacare, which he said is about providing access to the uninsured. This restructuring would move the United States from “a system rewarding volume to one that focuses on outcomes, that we start to value prevention” as a way to not only keep patients healthy but also to reduce cost. (There it is again: money.)

Pearl said this “will be very disruptive. These changes will fundamentally alter how physicians practice and how patients receive care, but I think from an ethical perspective they are the right answer.”

He linked this fundamental reorganization to improvements in patient safety — too many patients are harmed while they are receiving care. (Start with sponges left inside a patient after surgery or a patient who picks up an infection while in the hospital.)

Pearl pointed specifically to how hospitals are reimbursed and how the way the money flows fights against patient safety. Right now, Pearl said, the typical U.S. hospital makes about a 4 percent profit margin. But ironically, “four percent of the people that are there are because of a medical error — pressure sore, central line infections. If they’d avoided developing the complications, [the hospital] would be out of business.” (A study published in JAMA on Wednesday confirmed how hospitals profit when patients suffer surgical errors.)

Sweet was doubtful about the prospect of radical systemwide overhaul, but then drew applause when she said Kaiser “does a fantastic job” and proposed turning over “the whole system to Kaiser and let them do it.”

Even UCSF’s Josh Adler was smiling and called Kaiser “groundbreaking,” but still offered that “what universities bring to the pie is really pushing the next great thing that might happen” — he named organ transplantation and genomic medicine for starters. He said,”The universities do have a role to create that innovation and exploration,” and quipped that he felt his job was safe for a little longer.

More primary care providers needed — but not just physicians

One specific area where Adler saw a role for systemwide change was to allow non-physician professionals — nurse practitioners, pharmacists and medical assistants, to name a few — to practice at the “top of their license.” With more than 30 million currently uninsured Americans gaining health insurance through Obamacare starting in January, the United States will need a lot more primary care providers to treat those people. But doctors traditionally have been oriented toward protecting their incomes (money again) and have been opposed to letting other types of professionals in on their turf.

I asked Adler if he thought doctors were behaving ethically when they organized against allowing nurse practitioners or other non-MDs to provide expanded primary care.

“I think it’s wrong,” Adler said bluntly. “I think protecting patient care only within the realm of physicians is a bad strategy for the United States.”

Calls for better end-of-life care

Perhaps nowhere in medicine is the question of ethics more challenging than in end-of-life care. Sweet urged everyone attending the panel to at the very least write a letter outlining “who you are as a person and how you value freedom, lack of pain, life.” Absent some kind of specific directive to loved ones — even a conversation, Sweet said — the presumption is “you would want everything done.”

Adler expanded on Sweet’s point, saying that these discussions are not just for people at the “very, very end of life” but even the “very, very sick.” He cited a program at UCSF where people with heart failure were talked to explicitly and clearly about their preferences. These were not patients who were terminally ill. Many of these people were frequently hospitalized. But, upon careful discussion, some of those patients opted not be hospitalized again and to simply go with comfort care. “But the amazing thing,” Adler said, “is those patients lived longer than those people who kept coming back to the hospital for aggressive care.”

Pearl agreed. “Physicians are very bad at telling patients bad news,” he said. “Patients are much stronger than we as doctors believe. … Once people feel like they have control, they’re not victims … they live longer and live better.”

As the discussion wrapped up, we returned to the looming Jan. 1 implementation of Obamacare. “It’s going to be a bumpy ride,” Adler said, “but we are on the right path and our desire is to stay on the path until we get it right.”

“There’s a broad way that the American medical system is stuck in the 19th century and has to move into the 21st century,” Pearl said. “To me that’s an ethical issue, and it’s not going to get resolved on Jan. 1, 2014. I think it will be an evolution in our society over a five-to-10-year period.”

Watch the one-hour discussion:

(Dale M. Moore/Flickr)

Perhaps the most popular provision of President Obama’s federal health law is that people cannot be turned down or charged a lot more because they are sick. Obamacare also reduces how much more older people can be charged for insurance.

But the president’s health law permits one group to be charged more — a lot more: smokers. States can allow health plans to charge tobacco users up to 50 percent more for their health insurance premiums.

The provision allowing for a “tobacco surcharge” was designed in part to encourage smokers to quit a habit that often leads to major illness.

The Centers for Disease Control puts the nation’s annual price tag for smoking at more than $190 billion in both medical care and lost productivity.

It’s that price tag that prompts some to support higher health care premiums for smokers. Micah Weinberg is a senior fellow with the Bay Area Council, which researches public policy issues that affect businesses and the local economy. While he says caution is needed to avoid premiums so high that they are unaffordable to smokers, ”I think that we need to make sure that there is a strong financial disincentive for people to smoke.”

But critics say the smokers’ surcharge is discriminatory and goes against the spirit of federal health reform.

It can also negate the benefits of subsidies offered under the federal health care law, says Karen Pollitz, a senior fellow with the Kaiser Family Foundation .

For example, a low-income person buying a $6,000 policy who qualified for a subsidy might see the price of the annual policy drop to $3,000, Pollitz says. But “the tobacco surcharge would knock it back up to $6,000 again.”

That was the finding of a study published last summer by the Institute for Health Policy Solutions in Washington, D.C. Smoking rates both in California and nationally are highest among lower-income people –- who often must juggle several jobs to support themselves and their families. The resulting stress, Rick Curtis, president of IHPS says, makes breaking the tobacco addiction even harder.

“For somebody who is totally hooked after many years, and older – and those kinds of people often do need more medical care, they have emphysema and so forth – they have two bad choices: go without health insurance and be impoverished that way, or get health insurance and be impoverished,” he said.

That argument resonates in Sacramento where Assemblyman Richard Pan (D-Sacramento) has written legislation that would make California among the first states to ban higher premiums for smokers under the Affordable Care Act. He believes providing smokers with affordable health insurance is a better way to help them kick the habit.

“It does not make sense to have smokers being uninsured,” says Pan, who is also a practicing pediatrician. ”We want smokers to actually have health care coverage. … [T]hrough having health care coverage they’ll have access to smoking cessation treatment” as well as health care in general.

Weinberg calls effort by California to ban higher premiums for smokers misguided, especially when based on findings that those smokers are disproportionately poor.

“We have this very paternalistic attitude about lower-income folks that I think is inappropriate and particularly inappropriate in this context,” he says. “Because if we eliminate the financial incentive not to smoke we’re going to create an environment in which more people do smoke.“

Weinberg’s concerns aside, Pan’s bill faces little opposition –- not from cigarette companies, anti-smoking groups or anti-cancer advocates.

Officials at the American Lung Association’s California branch said in a statement that because smoking is so hard to quit, it’s essential to provide tobacco users with affordable health insurance, rather than make them pay more for it.

(Vic: Flickr)

Federal tax credits designed to make health insurance more affordable, starting next year, will help nearly 3 million Californians buy health insurance, according to a study issued Tuesday.

The report commissioned by Families USA – a supporter of President Obama’s health care reforms — says that more than 85 percent of all Californians who qualify for the federal tax credits live in families with at least one full- or part-time worker who doesn’t receive employer-sponsored health insurance.

It also finds that 52 percent of Californians expected to qualify for the sliding-scale tax credits will come from middle-class families who earn up to $95,000 a year.

The biggest block of recipients — about a million people — live in Los Angeles County. About 100,000 people in Santa Clara County are expected to receive subsidies and about 75,000 people in Fresno County. (You can look up other counties in the report, on page 7. [PDF])

The report estimates that Latinos will make up half the eligible Californians; whites will make up about 30 percent; blacks about 5 percent, with the remainder comprising mostly Asians and Pacific Islanders.

The tax credits will be “advanceable,” meaning they will be applied as an upfront discount at the time enrollment in California’s new health insurance marketplace, called ”Covered California.”

“People won’t have to … pay the full premium and then try to get a reimbursement for it,” said Rep. Henry A. Waxman (D-CA) in a Tuesday morning conference call with reporters after the report’s release. “They’ll simply enter their income information, shop for coverage and then get an automatic discount of hundreds or even thousands of dollars.”

California’s health insurance marketplace is scheduled to open for enrollment this October, with coverage beginning on Jan. 1, 2014.

Covered California has a subsidy calculator where consumers can quickly get an estimate.