Premiums for health insurance sold through the state’s marketplace will increase by nearly 8% in 2025, Covered California officials announced Wednesday.
That’s a smaller increase than this year’s 10% hike, which was the biggest jump in Covered California insurance costs since 2018.
Covered California Executive Director Jessica Altman in a media call attributed the upcoming increase to factors such as rising pharmacy costs, labor shortages and wage increases in the health care industry.
So what does this mean for consumers?
Most enrollees are typically shielded from annual premium increases because they receive financial assistance from the government. When the cost of premiums rise, usually so do government-funded subsidies.
People who don’t qualify for subsidies bear the full cost of rate hikes. About 90% of Covered California 1.7 million enrollees receive aid.
Premium increases vary by region and insurance carrier. Like most years, the 29,000 enrollees in the coastal region comprising Monterey, San Benito and Santa Cruz counties will see the biggest spike: an average increase of 15.7%.
That area is one of the most expensive health care markets in the country. Experts have blamed geographic isolation and lack of market competition in the area for its high health care costs.
A notable change in 2025 for that area is that Kaiser Permanente will begin serving residents in Monterey County, and is expected to cover about half of the marketplace enrollees there.
In terms of insurance carriers, Aetna CVS Health, Anthem Blue Cross and Blue Shield have proposed the biggest rate hikes — 15.4%, 12.7% and 8.4%, respectively. Blue Shield and Anthem cover…
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