More than 45,000 San Diegans signed up for health insurance via Covered California through the end of December. The vast majority of them qualified for income-based subsidies and chose plans with good brand recognition and a history of providing insurance to individuals.
One insurer starting to buck part of those trends is San Diego-based Sharp Health Plan, which is rapidly expanding its market share in this region, despite only entering the individual market when Covered California launched last October. The 20-year-old plan, affiliated with health system Sharp HealthCare, has historically only provided small- and large-group insurance.
Six insurers provide coverage to San Diego residents on the state’s health care exchange. By the end of the 2013, Health Net enrolled 12,630 people in San Diego, followed by Blue Shield of California with 11,976, Anthem Blue Cross of California with 8,711, and Kaiser Permanente with 7,450. Sharp Health Plan enrolled 4,126 by the end of the December, and it said that figure rose to 5,200 in January.
“What’s especially gratifying is that we’re new to the individual market,” said John Cihomsky, a spokesman for Sharp Health Plan. “We believe the strength of our brand is what’s helping drive the numbers, and, of course, we can expect more growth as we move closer to the March 31 deadline.”
A mere 188 people joined Molina Healthcare, which is reflective of its low enrollment numbers statewide. This is a “disappointment as the company has invested significant resources into its exchange business,” Citigroup health care industry analyst Carl McDonald said in a December client note. Molina previously insured patients in Medicaid and other government programs, making its presence in the Covered California market a departure from its norm.
There are 11 insurers participating in Covered California; four of those — Anthem Blue Cross, Blue Shield, Kaiser Permanente and Health Net — command 96 percent of the market share throughout the state. These insurers rolled over many of their pre-existing individual plans onto the exchange; Covered California did not release the number of enrollees who previously were uninsured.
It’s no coincidence that the larger health plans have commanded a large share of the market, said Larry Levitt, co-executive director for the study of health reform and private insurance at the Kaiser Family Foundation. The market has shifted, he said, from buying insurance plans recommended by brokers to a more direct-to-consumer market, which relies more heavily on brand recognition.
“The plans gaining the most market share are the ones that have dominated the individual market for years in California,” Levitt said. “Going into the [Affordable Care Act], the big plans have a built-in advantage through their brand recognition and, of course, have more marketing muscle.”
The 45,081 enrollees who signed up in San Diego significantly outpace the state agency’s original projections; Covered California had expected about 43,000 to sign up by March 31, which is the end of the six-month enrollment period. About 84 percent qualified for subsidies, and the remaining 7,199 paid in full for the insurance. The Affordable Care Act stipulates that individuals with income up to 400 percent of the federal poverty level are eligible for subsidies in the insurance exchange.
Covered California insurance is broken down into four “metal” tiers, with bronze being the most basic plan and platinum the richest. The vast majority of the subsidy-eligible enrollees in San Diego — about 64 percent — signed up for the midlevel silver tier, which provides lower drug costs and copays and other such perks. Subsidized individuals could pay as little as $7 per month for a silver plan in San Diego, depending on their income level.
Unsubsidized enrollees had a very different distribution, with 38 percent signing up for bronze, 26 percent for silver, 14 percent for gold and 17 percent for platinum.
While San Diego County represents about 8.3 percent of the state’s population, it accounted for about 9 percent of the more than 500,000 Covered California enrollees. An additional 125,000 Californians signed up through the insurance exchange in the first two weeks of January; San Diego-specific numbers for that period have yet to be released.