Progress won’t be even, but tools are in place to promote stability and private-sector opportunity, a CMS administrator says.

June 10—The government-run health insurance marketplace remains a work in progress, but it has given consumers an unprecedented voice in their own healthcare coverage and established tools to provide stability and opportunities for private-sector health plans to succeed, said Andy Slavitt, acting administrator for the Centers for Medicare & Medicaid Services (CMS).

Slavitt spoke at “Marketplace Year 3: Insurer Insights and Innovation,” a U.S. Department of Health & Human Services forum held June 9 at which insurance industry representatives shared some of the lessons they have learned.

“It is still in its early trial-and-error stage,” Slavitt said of the marketplace. “Progress won’t be even and for the first five years, we will continue to be in a learning and experimentation period where a lot will be tested before best practices are more widely developed.”

Slavitt compared the marketplace to Medicare, noting that, “before it became the beloved program that millions of Americans relied on,” it too had a controversial beginning and went through “a number of evolutions.”

Deductible Deduction

At the root of many of the marketplace evolutions has been the insurance industry’s response to consumer demands. Previously, everyone but the consumer has had a say in shaping health care, Slavitt said, adding that plans are responding with steps such as dropping deductibles for basic primary care services and for generic drugs.

It’s not uncommon for the newly insured to ask, “What’s a deductible?” said one of the speakers at the forum, Rachel Reimann, regulatory compliance administrator for Murray, Utah-based SelectHealth.

“We have to educate new marketplace consumers at every step along the way,” Reimann said, adding that marketplace success depended on enrolling the previously uninsured.

Russ Elbel, Medicaid program director for SelectHealth, noted that social needs often overshadowed clinical needs for many of these enrollees, and that was something the organization learned to address when targeting the population that made up the top 5 percent of healthcare service users. A comprehensive care program was developed to address the conditions of these patients and transition them to basic primary care, he said.

Elbel also noted that some organizations have come up with a new, easy-to-remember name and acronym for coordinated care services: TACO, or “Total Accountable Care Organization.” But SelectHealth wasn’t planning to adopt the term, he added.

Both Reimann and Michael Considine, vice president of consumer, small-group, and midsized markets for Horizon Blue Cross Blue Shield of New Jersey, said their companies took steps to tackle members’ confusion over billing and communications, which Considine described as a “major pain point.”

Horizon also took steps to more quickly process members’ payments. The slowness with which checks were being cashed led to calls from members who were concerned that the company had not received their payment or that they had been dropped from coverage, Considine said.

Constant Variation

While there is much more data to study, Rebecca Owen, a health researcher with the Society of Actuaries, said it will take a while to truly understand what happened in the early stages of the exchanges.

“Variation is the only constant we’ve seen,” Owen said. “Each state had a different starting point. No two states had the same implementation.”

A few generalizations could be made, however, including the fact that there was pent-up demand for services stemming from decisions by many people who had been poor and uninsured to put off receiving needed care. Also, the newly insured tended to have more chronic and complex conditions.

“Where we find low incomes, we find health needs,” Owen said.

Another generalization was that the designated special enrollment periods greatly added to healthcare costs.

“Special enrollment periods include babies, and babies can be expensive,” Owen said.

Slavitt also noted that CMS found many special enrollment periods “unnecessary or subject to abuse,” so it took steps to eliminate some of them while adding validation requirements for others.

Implementing a new special-enrollment process, designed to prevent people from enrolling in coverage only when they get sick, was one of several steps CMS will take to improve the marketplace risk pool, according to a June 6 announcement.

Other steps include curbing abuses of short-term plans that end up keeping healthy individuals out of the risk pool, improving risk adjustments, and helping consumers transition to Medicare when they turn 65.

Short-Term Disagreement

These measures were praised by the Alliance of Community Health Plans (ACHP), an organization to which SelectHealth belongs.

“ACHP members have emphasized repeatedly that a broad, stable risk pool is critical for health plans to maintain and expand coverage,” Ceci Connolly, ACHP president and CEO, said in a release. “These steps will encourage people to enroll, and stay enrolled, in health plans that provide essential benefits.”

The American Action Forum (AAF), however, criticized the moves, particularly those involving short-term plans. The organization said the steps would limit choices for consumers seeking lower-cost alternatives to marketplace plans.

“Short-term plans have grown in popularity over the years, and the proposal will likely hurt consumers who rely on the plans,” wrote AAF President Douglas Holtz-Eakin and AAF Press Secretary Madison Wiberg in the organization’s Daily Dish newsletter.

Labor Market Implications

They also cited a new Goldman Sachs study “suggesting that a significant chunk” of employees with part-time jobs had lost hours due to the Affordable Care Act’s (ACA’s) employer mandate requiring companies with 50 or more employees to offer health benefits to anyone who puts in more than 30 hours a week.

The Goldman Sachs researchers, however, noted that recent studies on the relationship between the ACA and involuntary part-time work “reached mixed conclusions.” The authors wrote that involuntary part-time employment “remains stubbornly elevated,” with employees in the retail, leisure, and hospitality industries most affected by the ACA mandate.

Across the economy, however, the evidence is “less conclusive” and the “relationship is weak” between the employer mandate and involuntary part-time employment. Overall, they conclude that the ACA has “at least modestly elevated involuntary part-time employment.” They estimated that the employer mandate may have resulted in “a few hundred thousand workers” stuck in part-time employment out of the 6.4 million who remain in that classification.

Andis Robeznieks is a freelance writer based in Chicago. Follow Andis on Twitter at @AndisRobeznieks.

Publication Date: Friday, June 10, 2016