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June 10, 2019

Insurance Industry Spotlight

The California Health Care Foundation has conducted a detailed review of new data released by the regulators of California’s large health insurers. Their report, “California Health Insurers: Large Insurers Remain on Top” provides a snapshot of the insurance market in California at the end of 2017.  They reviewed key data from the state’s two insurance regulators, the Department of Managed Health Care (DMHC) and the California Department of Insurance (CDI), and other sources were used to examine market share, enrollment, financial performance, and consumer satisfaction.  Key findings include:

  • ♦  California health insurance was a $183 billion business in 2017, up from $162 billion in 2015, a 13% increase. Only six insurers accounted for more than two-thirds of the revenue.
  • ♦  Total revenues for DMHC-regulated insurers increased by 15%, from $144 billion in 2015 to $166 billion in 2017.
  • ♦  Kaiser accounted for a third of total revenues – three times more than the next-largest insurer.  Most of the largest insurers, under both DMHC and CDI, were profitable in 2017.
  • ♦  Overall enrollment was relatively flat in 2016 and 2017. At year-end 2017, California’s insurers covered 14.1 million commercial enrollees and 13.2 million public managed care enrollees, of which 10.7 million had Medi-Cal. California insurers provided administrative services only to another 5.7 million enrollees in employers’ self-insured plans.
  • ♦  The ACA requires insurers to spend a minimum share of premium dollars on medical care or pay a rebate to consumers. In 2017, California insurers owed $97.4 million in premium rebates.
  • ♦  Rebates averaged $106 per person and benefited nearly 920,000 Californians.  Three insurers did not meet the ratio:  Anthem Blue Cross, Blue Shield, and Aetna.  Health Net Life and United Healthcare exceeded the ratio.
  • ♦  Most commercial enrollment growth in 2016 and 2017 occurred in HMO products.
  • ♦  In 2017, California insurers provided Administrative Services Only (ASO) for 5.7 million enrollees in employers’ self-insured plans.  Under ASO arrangements, insurers provide claims processing and provider networks.
  • ♦  ASO business was a large portion of the enrollment for Aetna, Anthem Blue Cross, Cigna and United Healthcare.
  • ♦  Kaiser covered nearly half (47%) of all Californians with commercial coverage.  Three insurers covered 75% (Kaiser, Anthem Blue Cross, and Blue Shield).

You can access the full report here: https://www.chcf.org/wp-content/uploads/2019/05/CAHealthInsurersAlmanac2019.pdf

And you can find the Quick Reference Guide here: https://www.chcf.org/wp-content/uploads/2019/05/CAHealthInsurersAlmanac2019QRG.pdf

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