Why California’s Market Is Stronger Than Most States

Posted: July 14, 2017

by John Hansen

California has one of the most stable health insurance markets in the nation. The Covered California State Exchange is strong, and all regions in the state have at least three carriers offered.

Other states across the country are not fairing so well. Many regions outside of California have only have one carrier offered, and in some areas there is no carrier at all.

California has the great advantage of having a very large population. You could put the population of most states in the country together into one heap and still not have as many people as there are in California.

One in 30 people in the entire nation actually live in Los Angeles County. This fact has been advantageous for carriers that focus on this area including Molina Insurance, L.A. Care, and SHARP.

More people means bigger risk pools, more stability in the market, more carriers available and more competitive pricing. All this has created a strong market in California.

Also, according to Jeff Smith, Blue Shield Covered California Individual and Family Plan General Manager, “A lot of states didn’t start out right.” Some didn’t create their own exchanges and just waited for the federal exchange. Others, came in later and had less time to prepare.

All the frenzy about modifying or throwing out the Affordable Care Act in Washington DC largely focuses on problems with the system outside of California. “Solutions” aimed at helping struggling exchanges may actually end up hurting the nation’s most successful exchange, Covered California.