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When Covered California Goes Wrong, Insureds Get The Runaround

When it comes to signing up customers, Covered California has been a success. But when it comes to serving customers, the independent public agency — now in its third year of helping individuals and small businesses get federally subsidized or free health insurance — still has growing pains.

While the insurance marketplace works for most enrollees, a single mistake can set off an avalanche of errors that blocks coverage or generates inaccurate tax forms. When customers try to get problems fixed, some say, they get bounced from Covered California to their health insurer and back again. Even when all three parties get on a call together and come up with a solution, the fix doesn’t get made — or doesn’t stay fixed.

The Chronicle has learned that Covered California will submit a budget proposal to its board on Monday that includes $2 million for a new ombudsman’s office. In April, The Chronicle reported that Covered California lacked an ombudsman or consumer advocate, unlike many other public agencies.

For Elin Larson of Redwood City, Covered California worked just fine in 2014, but when 2015 rolled around, she discovered that the subsidy she had been getting on her Kaiser Permanente policy had disappeared, even though her income and household size had not changed. “I was on the phone with Kaiser and Covered California for almost three hours every week. It was like a little part-time job,” Larson said. “I almost got to the end of my rope on a couple occasions. I was crying.”

2 million calls

The office of state Sen. Jerry Hill, D-San Mateo, helped get her subsidy reinstated in March 2015. But when she got Form 1095-A — a tax document showing her coverage, premiums and subsidies for 2015 — it said she had insurance for only one month last year instead of 12. That started a new odyssey. “I think I have post-traumatic stress disorder from all this,” she said.

Covered California’s customer service department has handled nearly 2 million calls in the past six months, said Peter Lee, the agency’s executive director. “Of those, over 97 percent were handled and resolved without being escalated,” he said. But “when you are dealing with big numbers, even a very small percent can be a lot of people.”

Complaints regarding policies sold through Covered California more than tripled — from 716 in 2014 to 2,273 in 2015, according to new data from the state Department of Managed Heath Care, which regulates almost all private insurers that sell through the exchange. It received an additional 600 complaints over those two years, including eligibility and tax questions, that fell outside its jurisdiction and were forwarded to the insurers or Covered California.

California was the first state to start setting up its own exchange under the Affordable Care Act. Since its inception, Covered California has helped about 2.5 million people get health insurance from private insurers for at least one month — about 90 percent of them with premium subsidies, Lee said. It currently has about 1.3 million people enrolled and has been credited with keeping premium increases lower than many other states.

‘Serious issues’

Nevertheless, in mid-August, the Health Consumer Alliance, a consortium of legal aid groups, wrote a letter to Covered California’s governing board detailing “serious issues faced by Covered California enrollees.” It cited the system’s inability to manually override computer problems and its refusal to correct erroneous 1095-A tax forms.

“Although Covered California resolved a backlog of complaints outlined in the letter, problems persist.”

Jen Flory, Senior Attorney with Western Center on Law & Poverty

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