ACA Insurance Exchanges Launch Amid Coverage Questions

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National Journal
Clara Ritger
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Clara Ritger
Sept. 30, 2013, 5 p.m.

Lead­ing up to Tues­day’s open­ing of the Af­ford­able Care Act health in­sur­ance ex­changes, much of the polit­ic­al pun­ditry fo­cused on wheth­er the cus­tom­ers would come.

Now that the ex­changes are open for busi­ness, the next ques­tion is wheth­er un­in­sured Amer­ic­ans will be sat­is­fied with what they find when they get there.

“I don’t think we can sit here today and say for cer­tain wheth­er they will ul­ti­mately have the care they need,” said Ceci Con­nolly, man­aging dir­ect­or of Price­wa­ter­house­Coopers’ Health Re­search In­sti­tute. “In our in­ter­views with pro­viders, it was a big con­cern.”

Price­wa­ter­house­Coopers last month re­leased its find­ings that in or­der to lower premi­ums, in­sur­ance com­pan­ies are lim­it­ing the num­ber of hos­pit­als and phys­i­cians avail­able to con­sumers in ACA ex­change plans.

“In­surers passed over ma­jor med­ic­al cen­ters in Chica­go, In­di­ana, Ken­tucky, Los Angeles, Ten­ness­ee, and else­where in an ef­fort to tamp down hos­pit­al and med­ic­al costs,” the re­port said. “But the use of nar­row net­works may also lead to high­er out-of-pock­et ex­penses, es­pe­cially if a pa­tient has a com­plex med­ic­al prob­lem that’s be­ing treated at a hos­pit­al that has been ex­cluded from their health plan.”

Some­times, however, a nar­row net­work in­cludes a pro­vider such as the Mayo Clin­ic, which of­fers a full range of ser­vices, Con­nolly said.

“Much is go­ing to de­pend on the in­di­vidu­al and what their health status and needs are,” she said.

It is un­clear wheth­er pa­tients will be will­ing to make the trade-off of hav­ing few­er choices for a lower price tag. Gary Co­hen, dir­ect­or of the Cen­ter for Con­sumer In­form­a­tion and In­sur­ance Over­sight at the Cen­ters for Medi­care and Medi­caid Ser­vices, said lim­it­ing op­tions to drive down costs isn’t unique to Obama­care.

“The use of nar­row net­works is something that people have been talk­ing about for a long time as a way to keep health care costs down,” said Co­hen, who is lead­ing the im­ple­ment­a­tion of the ex­changes.

But Chris Jac­obs, seni­or health policy ana­lyst at Her­it­age Found­a­tion — the con­ser­vat­ive think tank as­so­ci­ated with Her­it­age Ac­tion’s cam­paign to de­fund Obama­care — said pa­tients have more to worry about than wheth­er they can keep their doc­tor.

“Are there even enough doc­tors in the net­work?” Jac­obs said. “If they get swarmed with people, are they go­ing to be able to take care of them?”

One of the reas­ons the in­dustry has lim­ited the net­works, Con­nolly said, is in re­sponse to pres­sure to keep prices on the ex­change at­tract­ive.

“This is a very price-sens­it­ive pop­u­la­tion that is lower in in­come,” she said.

Ac­cord­ing to the Price­wa­ter­house­Coopers study, 94 per­cent of in­surers be­lieve premi­um prices will mat­ter most to the people weigh­ing in­sur­ance cov­er­age on an ex­change.

It’s why some in­surers have op­ted out of some mar­ket­places al­to­geth­er.

One-third of health in­surers don’t plan to par­ti­cip­ate in the ex­changes, or haven’t yet de­cided, ac­cord­ing to the PwC study, cit­ing con­cerns about prof­it­ab­il­ity, un­der­stand­ing the be­ha­vi­or of newly eli­gible cus­tom­ers, and an­ti­cip­ated high use of ser­vices among those who enter the ex­changes.

In some mar­kets, this re­luct­ance has res­ul­ted in a loss of com­pet­i­tion. Ac­cord­ing to the Health and Hu­man Ser­vices De­part­ment, 5 per­cent of people — in­clud­ing those in West Vir­gin­ia and New Hamp­shire — will be shop­ping for ex­change plans offered by only one in­sur­ance com­pany.

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