After 17 wonderful years with the California Health Care Foundation, today is my last day. I have been reflecting on how health care in California has evolved during my tenure. Some things haven’t changed much: Care delivery and financing are fragmented. Health care spending is high. Quality and access to care are uneven.

However, one domain has changed dramatically for the better — access to the state’s individual health insurance marketplace, the fallback option for people not offered health coverage through work and also ineligible for public programs such as Medi-Cal or Medicare.

When I joined CHCF in 1999, I frequently heard from consumers who were puzzled or distraught by California’s individual health insurance market: “I want to quit my unsatisfying job and do freelance work, but how would I get health insurance?” “We’re thinking of retiring early and moving to a rural area — can we keep our individual coverage?” “Can a health plan really turn me down just because I took antidepressants for six months a few years ago?”

I spent hours explaining to consumers, journalists, and policy staff that under California law, health plans could indeed deny coverage or charge higher premiums based on a person’s health history. Once enrolled in an individual market product, a consumer had the right to maintain coverage through that particular plan and product. But all bets were off if someone with a preexisting health condition wanted to switch carriers or plans in pursuit of a better price, to obtain benefits that better suited changing personal needs, or to move outside the carrier’s service area. In 2004 only about one-quarter of potential purchasers in the individual market obtained coverage there, and 20% of Californians were uninsured.

During this period, some states tried to expand consumers’ access to coverage regardless of health histories. Because buying coverage was voluntary, consumers with significant health care needs were the most likely to seek and keep coverage. That drove costs up for the overall pool, which discouraged healthier people from buying individual coverage. It was clear that the trade-off — relatively affordable access for a few healthy consumers in exchange for extremely expensive coverage for any comer — was a devil’s bargain.

Taking the Long View

Since it was established in 1997, CHCF has sought a health care system that works for all Californians. Access to coverage regardless of health status and income was an important piece of that vision. We knew what was wrong with individual coverage in California — but how could we help make it better?

CHCF’s status as an independent, state-based foundation helped determine our approach. We developed expertise on California’s uninsured population and the characteristics of its health insurance market. We took the long view. Despite many years in which there was little visible progress, we steadily invested in useful information and credible analyses. We embraced the complexity of the issues and didn’t settle for simplistic solutions. We built relationships with and among leaders from policy, insurance, provider, and consumer organizations and helped them understand each other’s perspectives.

When policy windows of opportunity opened at the state and federal levels, we acted quickly. We responded when California policy staff and stakeholders requested resources to analyze and refine options, convene stakeholders, and offer useful analyses of California’s market and demographic realities that could inform their deliberations.

When the Affordable Care Act (ACA) was enacted in 2010, every state faced many implementation options. Building on groundwork laid over decades by many people and organizations, California did more than most states to expand coverage quickly and effectively. Mutual respect and hard-won experience positioned California to tailor its ACA implementation to reflect state policy realities and to respect state market conditions. For example, legislation to establish California’s health benefit exchange, Covered California, went beyond federal requirements for standardizing benefits to require carriers to offer products across all benefit levels, and to allow apples-to-apples comparisons of products sold in the outside individual market with those offered through Covered California. At the same time, California embraced the ACA’s Medicaid expansion option, providing public coverage to millions of consumers with low incomes for whom individual coverage would have been unaffordable.

No More Preexisting Conditions

California’s individual health insurance marketplace today bears little resemblance to that of the mid-2000s. Since 2014 Californians have been able to purchase individual coverage without regard to their medical history. They can switch plans and carriers during annual open enrollment periods. Consumers face strong incentives to obtain coverage: They incur tax penalties if they remain uninsured, and all who are lawfully present and meet income standards are eligible for subsidies through Covered California. As a result, a greater share of Californians is now covered through the individual market than is uninsured (14% versus 11%, according to one national survey). While affordability concerns remain, early data show that Californians who bought insurance through the individual market spent significantly less than those buying before the ACA. And the percentage of Californians with individual coverage spending more than 10% of their household income on health care costs also went down.

During my time at CHCF, I was honored to work with talented and dedicated public servants and private sector leaders, health advocates, grantees, and foundation colleagues who together helped transform California’s individual market — a significant step that aligns perfectly with CHCF’s mission to ensure access to high-quality, affordable care for all Californians. I know that CHCF and its partners will continue advancing toward that overarching goal.

While there’s no shortage of remaining challenges that I might tackle next, I’m glad I can cross one concern off my list: No matter where or how I’m next employed, I know my family and I will have access to coverage through California’s vastly improved individual health insurance market.

Marian Mulkey

Marian Mulkey was chief learning officer at the foundation. From 2010 until 2014, she served as director of the foundation’s Health Reform and Public Programs Initiative, where she led CHCF’s work to analyze the Affordable Care Act and inform public and private stakeholders and the public on ways to implement the law that would improve and expand coverage. Read More

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