This rate hike is the largest California has seen since 2019. In the last three years, insurers had kept average increases under two percent.
When premiums increase, an individual's financial aid usually does, too. Aid is based on household income, so subsidies may offset some of the increase. But people who don't qualify for subsidies will bear the full cost of the rate hike.
Jessica Altman, executive director of Covered California said California's rate hike is still lower than it is in other states. A recent Kaiser Family Foundation analysis found a 10-percent average premium increase proposed by 72 insurers in 13 other states.
The rate increase, Altman added, is largely attributed to people resuming doctor visits and procedures that they postponed during peaks of the COVID-19 pandemic. There is also the cost of general inflation.
Currently one-point-seven million Californians buy their coverage through the state marketplace. Covered California has estimated that if Congress does not renew the American Rescue Plan subsidies, about a million people will see their premiums double and more than 200-thousand would likely drop their coverage.
