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Individual/Small Group Insurance Markets and the ACA

While individual and small group health insurance markets encompass only 15% of the state’s population (5 million), implementation of ACA reforms will transform these groups and how insurance is priced, purchased and sold.

A CHCF report examines the demographics and features of California’s individual and small group markets, as well as the uninsured. Highlights include:

  • Between 2009 and 2011, Californians had coverage through individual plans (2 million), non-Medicare public programs (5.3-6.9 million), Medicare (4.3-4.4 million), small group plans (2.8-3.4 million) and large group plans (14.2-15.5 million); small groups were those with 2-50 employees and large groups over 50. Over 5 million (5.2-7.3 million) were uninsured.
  • Of the 2 million with individual coverage, approximately 40% would qualify for Exchange subsidies and 18% for Medi-Cal.
  • Among the uninsured, 39% (2.8 million) would be eligible for Medi-Cal based on their current income. Another 3.4 million would be eligible for Exchange subsidies.
  • More than 1 million of the uninsured are undocumented immigrants, and thus ineligible for purchasing Exchange plans with or without subsidies.
  • ACA reforms will limit the variance of individual premiums by age to 3:1, down from the current fivefold variance.
  • Due to the essential benefit protections provided by health reform, individual insurance plans will provide more comprehensive coverage in 2014. Currently, individual plans pay an average of 55% of medical expenses, compared to 80-90% of expenses for group coverage.
  • The full report is available online at CHCF.org.

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