Transparency is the key priority for the future of health insurance exchanges, suggested experts during a webinar entitled, “Where is the Health Insurance Exchange Market Going? A Deep Dive.” In the presentation, which was sponsored by the Robert Wood Johnson Foundation (RWJF) and Manatt, Phelps & Phillips, LLP, (Manatt), presenters Katherine Hempstead, of RWJF, and Joel Ario and Chiquita Brooks-LaSure, both of Manatt, stressed that market trends and recent regulatory responses indicated that the increased public release of market information and data is necessary in order to allow consumers to make more informed choices when it comes to health insurance exchanges.
Trends. Despite the political strife that has accompanied the implementation of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), the presenters noted that the ACA marketplaces are an “entrenched part of coverage continuum,” and that the exchanges, both in the public and private realm, have bipartisan support. Additionally, the experts predicted that while tax credits under the ACA may be adjusted and while Medicaid expansion has been stalled in some jurisdictions, the credits will ultimately not be eliminated and the expansion will not be rolled back. In turn, the data reveals that insurer competition on the exchanges is in flux but remains the key benchmark of the system. Further, the available data from the exchanges show that premiums are increasing and risk pools are still not stable.
From this data, the presenters identified certain questions that they believed would shape the future of the marketplaces, including:
- Will Medicaid and marketplace integration improve?
- Will exchanges capture more consumers from the individual market?
- Will employers move to a private exchange system?
- Will regulators move towards standardizing benefit design?
- Will regulators encourage or limit networks?
- How will states deal with cost-sharing and “smoothing the coverage continuum?”
Data. Focusing on the data from the market, the webinar presenters focused mostly on the trends with regards to categories of plans (gold, silver, and bronze) and regional variations. For instance, while the number of gold plans declined in most states between 2015 and 2016, the decline was most drastic in the west south central and east south central states. In west north central states, gold plans increased by 18.8 percent. The experts also pointed out patterns such as the “sizable decline in percent of silver plans that are PPOs” during that same time period.
Premium increases in this timeframe were most prominent within gold plans, as an average premium for a 27 year old recipient of a gold plan in 2016 is $350, which is a 10.9 percent increase over the previous year. For silver and bronze plans for the same beneficiary in that time, the average premium is $287 and $238, which is a 7.3 percent and 9.5 percent increase from the previous year, respectively. Average deductibles for gold plans declined by 3.9 percent from 2015 to 2016, while deductibles for silver increased by 13 percent and those for bronze also increased by 11.4 percent. Finally, the speakers highlighted that there was convergence between but not within the health insurance exchange markets. In other words, they noted that plan “variation decreased between markets, but increased within markets.”
Regulatory responses. CMS has reacted to some of these trends by, according to the Manatt and RWJF representatives, “balancing providing flexibility to plans to control costs with helping consumers understand their plan choices.” In terms of premiums, the agency has increased rate review, enacted some risk adjustment modifications, and created stricter special enrollment period documentation. With regard to network adequacy and flexibility, CMS has reduced the number of requirements that were originally proposed. It also has imposed voluntary standardization of plan design with an eye to cost sharing and limiting variation in order to improve transparency for consumers.
The future. According to the webinar, the ideal future is one in which regulators would “make full plan information available in a standardized format 60 days prior to open enrollment or market introduction.” This future also would include requirements that insurers and providers post price and quality data and that consumers would have access to their medical records in a full and usable format.
Companies: Robert Wood Johnson Foundation; Manatt, Phelps & Phillips, LLP
IndustryNews: NewsStory HealthInsuranceExchangeNews AccessNews BenchmarkBenefitNews CostSharingNews InsurerNews MedicaidNews PremiumNews PremiumTaxNews
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