Californians shopping for health insurance in a new state-run market this fall may not see quality ratings for those health plans alongside the monthly price.

To the dismay of consumer groups, state officials are dropping plans to post those insurance company ratings in their online enrollment system, which opens Oct. 1 under the federal healthcare law.

The state’s health exchange, called Covered California, said this week that it reversed course because the latest state rankings examine performance from 2011, and they don’t reflect many of the new health plans and provider networks being offered for the first time.

The surprising decision has sparked sharp criticism from some higher-rated insurers, including Kaiser Permanente, and patients’ advocates who think that consumers deserve this vital information and shouldn’t have to shop primarily on price. Critics say that they will press the exchange to reconsider at its next board meeting Aug. 22.


“We think it’s important for consumers to have information on quality in Year 1, even if it’s not everything we want,” said Beth Capell, a lobbyist for the consumer group Health Access. She said quality scores would be particularly useful when similarly priced health plans vary widely on how they treat patients.

“If for five bucks more a month I can get a 4-star plan instead of a 2-star plan, I should have that information,” Capell said.

As many as 5 million Californians are expected to shop for health insurance in the state’s new marketplace next year. From the outset, state officials have touted the idea of consumers choosing coverage based on the overall value, combining price and quality measures.

To achieve that, the state planned to display on its enrollment website the monthly premiums of health plans alongside easy-to-understand star ratings on quality and details on their network of doctors and hospitals.


Peter Lee, executive director of Covered California, said the agency remains committed to providing quality ratings, but he said it isn’t in the best interests of consumers to highlight the current data given its constraints. In addition to being nearly 3 years old, he said, the current ratings focus on plans and networks that differ significantly from what will be sold on the exchange.

Some insurers have substantially cut their roster of physicians and hospitals to help hold down premiums for these new policies.

“These factors raise substantial concerns that the historic performance of plans may not be representative or complete enough to allow for direct comparisons between plans,” he said.

Instead, Lee said his agency will explore how to rapidly collect performance data based on the initial enrollees next year and create its own report card. The exchange could also point consumers on where to go for additional information.


“This is an issue we will continue to work on,” Lee said.

Consumer advocates and health policy experts worry that waiting to develop a valid set of ratings could take up to two years and leave consumers in the dark for too long. They also say a delay rewards lower-performing insurers.

The state’s Office of the Patient Advocate already publishes annual ratings of the largest HMO and PPO plans, handing out one to four stars in a variety of categories. The report card looks at whether insurers are meeting national standards for providing recommended care and it asks patients to rate their own experience.

The state also issues separate quality ratings on insurers serving patients in Medi-Cal, the state’s Medicaid program for the poor. Several of those plans that cater to lower-income residents will be selling policies in the broader exchange.


In a letter this week, executives at Kaiser, Sharp Health Plan and Western Health Advantage urged the exchange to prominently display quality scores when it launches to aid consumers and to ensure fair competition among companies.

Kaiser routinely scores well in rankings on quality of care and patient satisfaction. The healthcare giant was the only HMO in the state to earn a top four-star rating for providing recommended care on the most recent report card. Sharp and Western Health each received three stars on the same measure.

But the data also show consumers that even Kaiser falls short in some areas. Patients rated seven HMOs including Kaiser’s Southern California system as poor, or just one star, on whether they were able to get care easily.

Kaiser, Sharp and Western Health said they agree with the exchange that the introduction of narrower networks makes the current scores less useful in some cases. But they say state officials should label those health plans as “not yet rated,” rather than suppressing all quality scores.


“We’re going to have a lot of new consumers in the market,” said Jerry Fleming, a senior vice president at Kaiser. “We should make sure consumers have a chance to see this quality information and use it when making their choices.”

chad.terhune@latimes.com

Twitter: @chadterhune