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Nearly 2.5 Million Consumers Have Selected Health Plans On Federal Marketplace - WebMD

Nearly 2.5 Million Consumers Have Selected Health Plans On Federal Marketplace - WebMD | Healthcare and Technology news | Scoop.it

More than 1 million people selected a health plan during the fourth week of the health law’s open enrollment and nearly 2.5 million have done so since it began Nov. 15, federal officials said Tuesday.

“And this was before an extremely busy weekend,” said Andy Slavitt, principal deputy administrator of the Centers for Medicare & Medicaid Services, which oversees the federal online marketplace used by 37 states.

Tuesday’s report did not include enrollment for the final three days before the Dec. 15 deadline for people to enroll if they want coverage to begin Jan. 1.

Just over half of those individuals who have selected plans since the health law’s second open enrollment season began are returning customers. Enrollment in the states running their own exchanges is not yet available.

As expected, interest in healthcare.gov soared in the final days before the mid-December deadline, with 1.6 million people phoning the call center from Dec. 13 through Dec. 15, officials told reporters.

To avoid longer waiting times, nearly 500,000 people who called just hours before the Dec. 15 midnight PST deadline left their contact information. Website officials have begun to call them back, Slavitt said, and they will be able to enroll in coverage to begin Jan. 1.

At its peak volume Monday, healthcare.gov had more than 125,000 concurrent users but “we did not run into capacity constraints,” Slavitt said. “In other words, we are able to handle even more volume in the coming months ahead.” One website “waiting room” was used for about 90 minutes for “several thousand” individuals creating new accounts, Slavitt said. Their average wait time was about three minutes. Returning customers or those doing “window shopping” were not affected, Slavitt added.

In a call with reporters, Slavitt and Kevin Counihan, the CEO of healthcare.gov, said federal officials have begun to automatically re-enroll 2014 customers who have not selected a new plan for 2015. Less than 5 percent of current enrollees could not be automatically re-enrolled, Counihan said.


Counihan said the website has been sending daily updates to insurers to let them know about people that have switched health plans, helping to avoid confusion that could lead to insurers double-billing consumers. Separately Tuesday, America’s Health Insurance Plans said they would give consumers additional time to pay premiums due Jan. 1 and would provide prompt refunds if individuals were mistakenly billed for two health plans.

Several states, including California and Minnesota, have extended enrollment deadlines for coverage to begin Jan. 1.

Earlier Tuesday the consulting firm Avalere Health estimated that 10.5 million people would enroll in the health law’s state and federal exchanges by the end of 2015. Administration officials have estimated that about 9 million people would enroll in the exchanges while the Congressional Budget Office has estimated 13 million.

This story was updated to clarify the number of enrollees whose coverage could not be automatically re-enrolled.



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Big Changes in Fine Print of Some 2015 Health Plans

Big Changes in Fine Print of Some 2015 Health Plans | Healthcare and Technology news | Scoop.it

At first glance, the 2015 health plans offered by the Ohio nonprofit insurer CareSource look a lot like the ones it sold this year, in the Affordable Care Act’s first enrollment season.

The monthly premiums are nearly identical, and the deductibles are the same.

But tucked within the plans’ jargon are changes that could markedly affect how much consumers pay for health care. Generic drugs will soon be free, but the cost of expensive specialty medications will increase. Co-payments for visits to primary-care doctors will go down, but those for emergency room trips will be higher.

Millions of people nationwide bought health insurance this year through the federal government’s health insurance exchange, often through the website Healthcare.gov. Now, as they pick plans for next year, they face a complex battery of choices.

They have until Dec. 15 to select a new plan or they’ll be re-enrolled automatically in the one they currently have. Or, if that plan no longer exists, they’ll be enrolled in another product offered by the same insurer, when available. But even if they get the same plan — of the nearly 2,800 health plans offered in 2014, about 1,700 of them will exist in the same form next year — their benefits may not stay the same.



“You’re getting re-enrolled in the same carrier, but there’s basically no guarantees that your product looks anywhere near the same as it did last year,” said Caroline Pearson, vice president of Avalere Health, a consulting firm.

Much attention has focused on changes to plans’ monthly premiums, but changes to other kinds of benefits — affecting the cost of things like doctors’ visits and prescriptions — can be trickier to understand and make a huge difference in annual health care costs.

A ProPublica analysis of the 2014 and 2015 plans in 34 states being offered on the exchange shows the adjustments taking place. ProPublica has created a tool that allows users to see, quickly and easily, some significant ways the plans have changed from one year to the next.

Customers of more than 900 plans will see their out-of-pocket maximum for medical bills increase, usually to $6,600 for individuals, the most allowed by law for next year. Only about 250 plans are lowering their out-of-pocket maximums. About 180 plans are being discontinued for at least some customers, and the rest are keeping the same limits.

Members of more than 600 plans will see their medical deductibles increase, while those in about 380 will see their deductibles drop. Consumers of one Illinois plan will see their deductible increase by $4,800. Those re-enrolled in plans offered by Florida Blue face deductibles as much as $3,650 higher than those this year, while other customers of the same company will see deductibles decrease by up to $3,000. Florida Blue did not respond to a request for comment.

More than a quarter of the 2,800 health plans altered the costs of specialty medications for conditions like multiple sclerosis and AIDS, mostly increasing the patients’ share.



Some policy changes appear subtle, just a matter of adding or subtracting a few words, but are actually quite significant. This year, many insurers charged members a set fee of a few hundred dollars for emergency room visits. For next year, some of those plans changed the wording of their benefit, adding “co-pay after deductible.” That means the insurers won’t pay for any portion of an emergency room visit until consumers meet their deductible, spending thousands of dollars.

“Everyone has focused on premiums in the press because premiums are at least easy to understand,” Ms. Pearson said. People have a harder time detecting the effect of changes to what’s called a plan’s benefit design. “It’s just incredibly hard to do, but I think it’s really important.”

What ProPublica’s analysis suggests is that even those who would be willing to pay higher premiums to keep their current plan may be surprised to learn that substantial details have changed. They should go back to Healthcare.gov or to ProPublica’s news app to make sure their plan is still the best choice.

Shopping around is essential — and there’s little time to delay.

The open enrollment period continues until Feb. 15, and customers who are automatically renewed in their plans can still make changes until that time, but only changes made by Dec. 15 will take effect on Jan. 1.

The Health and Human Services secretary, Sylvia Burwell, has been encouraging consumers to take an active role in the renewal process. But in the first two weeks of open enrollment, fewer than 400,000 consumers actively re-enrolled. “The first deadline is just a couple of weeks away,” she said in a news release on Wednesday. “We’re encouraging everyone who is already covered through the marketplace to come back and shop because there could be savings.”



Everyone’s health care needs are different. Some people might do best with a plan that has a higher premium and lower out-of-pocket costs for particular services; others might save money by choosing a plan with a lower premium and higher co-payments.

Those earning less than four times the federal poverty rate ($62,920 for a couple) qualify for subsidies to pay their premiums, and those earning even less may qualify for additional help to lower their out-of-pocket costs once enrolled.

Changes to insurance benefits are hardly exclusive to the Affordable Care Act marketplaces. They happen regularly in health plans offered by employers.

Under the law, insurers are somewhat limited in how they can change their plans. Products are grouped by tiers: Bronze plans cover about 60 percent of their members’ overall health services; silver plans 70 percent; gold plans 80 percent. To stay at those levels from year to year, plans can’t just increase all of their charges. If they charge more for some things, that often means charging less for others.

That’s what happened at CareSource, the Ohio nonprofit. Officials there said they changed their benefits based on comments from members and conversations with others who are uninsured. “Many didn’t understand the value of health insurance,” said Scott Streator, vice president of Enterprise Strategy at CareSource. “Therefore, we changed our plan design to make it more simple, more understandable and more preventive, focused on everyday types of health care needs.”


That translated into free generic drugs and lower co-pays for physician office visits, Mr. Streator said. “If you make these changes, there’s trade-offs,” he said. “The costs go up somewhere else.” In contrast with this year, when members pay $250 for emergency room visits, they will need to meet the plan’s deductible next year before their E.R. visits are covered with a co-payment that varies from $250 to $500. And members will now pay 40 percent of the cost of specialty medications, up from 25 percent this year.




CareSource enrolled more than 30,000 people during the 2014 open enrollment cycle and expects to double that amount this time around, Mr. Streator said.

Another insurer whose products are changing is Coventry Health Care. One Coventry silver plan in the Kansas City, Kan., region is decreasing the costs of primary care visits to $5 from $10, but is increasing its medical deductible to $2,750 from $2,000, increasing its out-of-pocket maximum to $6,600 from $6,350, and increasing the cost of generic drugs to $15 from $10, among other changes. Premiums are also going up.

A spokesman said the company tries to balance its benefits and costs.

Vantage Health Plan, based in Louisiana, is increasing the medical deductible in its silver plan to $2,900 from $1,800 and is raising its maximum out-of-pocket costs, too. But the company said most of its members won’t feel the changes much. That’s because about 85 percent of the 8,400 members who enrolled in the last cycle received government subsidies.

Although those without subsidies “are going to get hit, all that was designed so that all those who are getting the subsidy, their blow would be softened because that’s where the majority of our business falls,” said Billy Justice, Vantage’s director of marketing and sales.

Vantage hopes to double its enrollment for next year.

The data analyzed by ProPublica does not include information for states that run their own insurance exchanges, including California and New York. In California, plans are required to offer a standard benefit design, which allows consumers to compare plans more easily. Insurers compete on their brand’s reputation, premiums and on the size of their doctor and hospital networks.

“There can be a big difference in the experience of the consumer in terms of what they pay out of pocket if you don’t have standardized benefits,” said Anthony Wright, executive director of the consumer advocacy group Health Access in California.

The government’s plan to automatically re-enroll consumers for 2015 has come under criticism, with some warning that consumers who don’t make a choice themselves could end up in a plan with higher costs. As a result, the government is considering a different system for 2017 in which consumers who don’t pick their own plan could be shifted to the lowest-cost plan in the market.



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Obamacare Limits Choice Of Health Plans

Obamacare Limits Choice Of Health Plans | Healthcare and Technology news | Scoop.it

Among the many myths advanced to help inflate perceptions of Obamacare’s success is the lore that the new exchanges are sites of robust competition and choice.

The most remarkable feature of the state exchanges isn’t the number of plans being offered, but the lack of new plans entering these markets. Sure some of the most populous states like California and New York have dozens of offerings. But in almost half of all U.S. counties, consumers can only choose from one or two insurers.

Yet even in seemingly competitive markets like California, many of the health plans offered on the exchanges is the same big insurer just selling variations on identical benefit packages. The most significant distinction between the plans is the marketing. Insurers change the name of their plan, and market it as a new brand.

This is ironic since, under Medicare’s drug program, the Obama Administration proudly barred insurers from selling these sorts of facsimile health plans. The Obama White House said that limiting Part D sponsors to providing only two plans per region would “promote needed clarity of plan choices for beneficiaries.”

Translation? The White House argued that, in marketing the same plan under different brands, insurers were gaining market share by “tricking” consumers into imputing distinctions between health plans where little existed. Today, the guise of competition in the Obamacare exchanges depends on just this sort of sleight of hand.

A review of data available on 37 states that use Healthcare.gov (and Covered California) shows that United Healthcare, the largest national insurer, is offering 1,661 different plans in the 185 rating areas it is participating in this year. Aetna AET -1.19% is participating in 137 rating areas is offering 982 plans. Wellpoint is offering 1,285 different plans in the 109 rating areas that it’s operating in, while Centene is offering 1,470 different plans in just 49 rating areas. It’s clear that these insurers aren’t just offering plans across the different metal tiers, but multiple brands in the same market — typically utilizing very similar (or same) provider networks and drug formularies.

At the same time, only 40 new health plans entered the Obamacare exchanges in 2014. Many are Coops — not-for-profit health plans that are heavily subsidized by the ACA, but already struggling financially to stay afloat. The rest are mostly integrated provider groups (like Boston Medical Center or North Shore LIJ System) that are trying to market their own stand-alone health plans directly to consumers.

The latter is an old concept that remains a holy grail of progressive healthcare wonks, who view it as a way to disintermediate insurers, along with their overhead costs. But the idea failed miserably when it was tried on a large scale back in the 1990s. It turned out that the provider groups suffered adverse selection from sicker patients who were attracted to brands offered by their local hospitals. The provider groups also proved that they couldn’t effectively manage risk, and they bled red ink.

The idea of disintermediating insurers is an interesting concept. But it’s been tried before. And failed. Largely for reasons that remain as true today as they were in the 1990s.

The Obamacare market stands in stark contrast to the rollout of Medicare Advantage (which was marked by hundreds of new entrants) and Medicare Part D (which attracted literally thousands of new plans into the nascent market).

The MA and Part D markets eventually consolidated, as health plans merged and were acquired by larger companies. But the Obamacare marketplace has nowhere to consolidate into. It should be little surprise that it’s being dominated by a small number of big national insurers that (together with the Blues plans) control 80% of the market. Obamacare is fashioned as an oligopoly of six large insurers.

Proponents of Obamacare argue that new insurers are taking a cautious approach, but will step into the state exchanges once enrollment trends pick up. But these early years of Obamacare may well represent the high water market when it comes to the number of health plans. If an entrepreneur wanted to launch a new health plan to be sold on the exchanges, this would be the time to do it. After all, the various risk-sharing arrangements limit downside losses through 2017.

Financial arrangements embedded in the law almost guarantee that the large, publicly traded health plans will continue to consolidate the marketplace. Principal among these are caps on the operating margins of insurance companies.

The idea was to make sure insurers are spending a high proportion of their premium revenue on paying member claims rather than padding their overhead. Under the ACA, operating margins (referred to as the Medical Loss Ratio) are set at 85% for the large group market and at 80% for the small group. But the provision also has the effect of protecting the large insurers at the expense of new start-ups.

That’s because start-up health plans have higher overhead costs in their early years, and small plans inevitably have more operating costs as a percent of their revenue than large, national plans that can spread fixed costs over a bigger share of revenue. Obamacare contains various provisions that try to take some accommodation of these economic principles. But none of these regulatory tweaks fully offset the advantage given to incumbent insurers at the expense of new entrants.

Obamacare was designed with the goal of commoditizing health insurance. The belief was that competition between plans would turn largely on premiums and cost sharing. This was seen as a way to hold down prices.

By limiting competition around benefits like formularies and networks, and the delivery of care, progressive architects didn’t inspire competition between different benefit packages and plan designs as a way to improve quality.

Consumers will figure out that most of the plans sold in the exchanges are facsimile products offered by the same small number of large insurers. In Part D, progressives called this confusing, and exploitative. In Obamacare, they call it a marketplace.

The health plans differ only by their names, and some tweaks to the cost sharing. This wasn’t the sort of robust competition and choice that proponents promised, or still lay claim to. The truth will eventually catch up to the painful reality.



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