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By Sara Hansard
March 30 — A Blue Cross Blue Shield Association (BCBSA) study confirms the challenge of getting a sufficient number of healthy people into Affordable Care Act marketplace plans to make premiums affordable.
The costs of new individual market members were 19 percent higher than employer-based members in 2014 and 22 percent higher in 2015, according to the study, released March 30. People enrolled in individual plans after marketplaces went online in 2014 have higher rates of diseases such as diabetes and coronary heart disease than those who had individual coverage beforehand, it said.
It wasn't surprising that ACA individual enrollees were sicker because prior to the ACA, plans in the individual market could either refuse to cover people with health problems or charge them more, BCBSA Senior Vice President Alissa Fox told Bloomberg BNA in a telephone interview March 30. “What did surprise us is how much higher the costs are than the group market,” she said.
Department of Health and Human Services spokesman Benjamin Wakana also said in an e-mail March 30 that “it's no surprise that people who newly gained access to coverage under the Affordable Care Act needed health care; that's why they were locked out of coverage before.”
However, in a background information statement, the HHS said comparisons in the BCBS analysis “are seriously flawed.” The analysis “provides a skewed picture of how the individual market as a whole compares to the employer market by comparing only the newly insured in the individual market in 2014 and 2015 to the group market,” the HHS said.
Prior to the ACA, employer plans typically covered both healthy and sick people but people with serious health conditions were often locked out of the individual market, the HHS said. Comparing the newly insured in the individual market with the employer market “makes the individual market look sicker than it really is,” it said.
The BCBSA study said consumers who newly enrolled in individual plans in 2014 and 2015 received “significantly more medical services in their first year of coverage, on average, than those with BCBS individual plans prior to 2014 who maintained BCBS individual health coverage into 2015, as well as those with BCBS employer-based group health coverage.” BCBS companies, which insure nearly 105 million members, including more than 8.6 million individual members, participate more broadly in the ACA marketplaces than any other insurance carrier.
The report was based on 4.7 million individual members and about 25 million employer-based group members.
The HHS said the insurers' analysis overstates differences between the newly insured and those previously insured in the individual market because many people who enrolled before 2014 are likely in grandfathered and transitional plans begun before enactment of the ACA that offer less comprehensive coverage. Twenty million people have gained coverage under the ACA, the HHS said.
The BCBSA's Fox told Bloomberg BNA that BCBS plans are focusing on expanding disease prevention programs and better coordinating care as well as improving communication on how to use health plans.
In addition, Fox said BCBSA wants to see the Centers for Medicare & Medicaid Services require documentation verifying that people who sign up for coverage outside of the normal annual open enrollment period are eligible for reasons such as a change in family or moving to a new location.
People who sign up for coverage through special enrollment periods account for up to one-third of the exchange population and incur significantly higher medical costs than those who enroll during regular open enrollment periods, America's Health Insurance Plans and the BCBSA said in an analysis released Feb. 23 . The CMS has reduced the number of special enrollment periods and has said it would take action to ensure that people are eligible when they sign up.
But Timothy Jost, a consumer representative with the National Association of Insurance Commissioners who supports the ACA, told Bloomberg BNA March 30, “We need to make it easier for people to enroll rather than harder.”
Jost said he is “concerned about this effort on the part of the insurers to shut down special enrollment periods. If you make it harder for people to enroll during special enrollment periods, it seems to me that people who are desperate for health coverage will figure out how to do it. But that people who are healthier may just give up.”
Jost also said government agencies need to start collecting data as required by the ACA on who is getting insured. “The only data we have is the data insurers give us,” he said. “Those are selective.”
“The exchange markets have only insured about 40 percent of those eligible,” Robert Laszewski, president of health policy and marketplace consulting firm Health Policy and Strategy Associates LLC, told Bloomberg BNA in an e-mail March 30. “Ideally, insurers want to see 75 percent of those sign up in order to get a good cross section of the sick and healthy. That this business segment has been suffering from anti-selection is not news.” Anti-selection, or adverse selection, refers to people choosing to sign up primarily if they have medical problems, which leads to higher costs and higher premiums for plans.
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The BCBSA study is at http://www.bcbs.com/healthofamerica/newly_enrolled_individuals_after_aca.pdf.
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