Additional Verification Curtails ACA Special Enrollments

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By Sara Hansard

Sept. 6 — Almost 15 percent fewer people signed up for ACA health plans outside of the normal enrollment period this year compared with 2015 after the Department of Health and Human Services required more verification of their eligibility, the HHS announced Sept. 6.

“Preliminary data indicate that the confirmation process has resulted in a material decrease in special enrollment period (SEP) plan selections,” the Centers for Medicare & Medicaid Services said in a frequently asked questions (FAQ) guidance document. The CMS is planning a pilot program to evaluate a pre-enrollment verification process in 2017, which could be used for policy changes in 2018, the FAQ said.

Health insurers have been pushing strongly for better verification that people who sign up during so-called SEPs—who have higher average medical claims than people who sign up during normal open enrollment periods—actually have a life-changing event, such as the birth of a child or a job change, that makes them eligible. Plans sold in Affordable Care Act health insurance marketplaces have been losing money, prompting major insurers UnitedHealthcare, Aetna, Humana and some Blue Cross Blue Shield plans to pull back on their offerings and leaving consumers with fewer choices.

The CMS has taken steps in recent months to prevent abuse of special enrollment periods, including asking for comments Aug. 29 in the 2018 Notice of Benefit and Payment Parameters proposed rule on ways to help more eligible people enroll through special enrollment periods and prevent abuse by ineligible people (168 HCDR, 8/30/16).

Insurers: SEP Abuse `Major Problem.'

Abuse of SEPs is “a major problem facing consumers and health plans in the Exchange,” Clare Krusing, spokeswoman for America's Health Insurance Plans (AHIP), told Bloomberg BNA in an e-mail Sept. 6. “There needs to be broader application and use of a pre-enrollment verification across the board (not just a pilot),” she said.

In February AHIP released a report by management consulting firm Oliver Wyman finding that SEP enrollment represented 17 percent of the total marketplace enrollment in 2014 and that the per member per month claim costs for SEP enrollees were 10 percent higher than people who enrolled during the regular open enrollment period. SEP enrollees are more than 40 percent more likely on average to let their coverage lapse than those who enroll during the normal enrollment period, the report said.

But Sarah Lueck, senior policy analyst for the Center on Budget and Policy Priorities, told Bloomberg BNA Sept. 6 that the 15 percent drop in SEP enrollment is concerning. “It's important to tread really carefully here,” she said.

Could Healthy People Enroll?

Requiring additional verification for SEP enrollment could result in fewer healthy people enrolling since “healthier people are more likely to be deterred by that sort of task,” Lueck said.

She pointed to estimates made by the Urban Institute that fewer than 15 percent of people eligible for SEPs use these opportunities to enroll in marketplace coverage; the rest are likely to end up uninsured.

The most common reason for enrolling through an SEP is loss of minimum essential coverage required by the ACA, Lueck said.

“There is frequently people churning from one program to another,” such as moving from Medicaid to marketplace eligibility as their income increases, or loss of employer-based coverage, the main reasons that people use SEPs, she said.

The intent of conducting a pilot program would be to evaluate the impact of pre-enrollment verification, the FAQs said. Decisions on what actions to take regarding special enrollment periods would be assessed as the CMS sees the results, it said.

What Data Show

The CMS's preliminary data show that for the seven weeks prior to implementation of a recently introduced confirmation process, SEP plan selections in 2016 were about the same as during the same weeks of 2015. In the seven weeks after implementation, SEP selections in 2016 were almost 15 percent lower than during the same weeks in 2015.

The questions the CMS is considering include:

  •  whether the pilot should be geographically targeted or involve a sample of consumers through the federally facilitated marketplaces;
  •  whether it should focus on a subset of SEPs that may be most prone to abuse;
  •  how the pilot should be conducted to minimize burdens on consumers and disruptions in coverage; and
  •  how to measure the impact of the pilot on compliance, enrollment, continuity of coverage and the health of the marketplace risk pool.

In a separate action the CMS announced $63 million in navigator grant awards to support local in-person assistance ahead of the open enrollment period for 2018, which is scheduled for Nov. 1 through Jan. 31, 2017.

To contact the reporter on this story: Sara Hansard in Washington at

To contact the editor responsible for this story: Kendra Casey Plank at

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