On Wednesday, HHS
announced that enrollment through the federal HealthCare.gov
website topped 100,000 in November. That was roughly four times the level of enrollment through the federal exchange in October and marked a period of time when the website continued to have significant problems. It also announced that a total of about 365,000 enrollments through by the federally run and state-run exchanges
in the first two months of open enrollment, a big jump from October.
That relatively positive news served as the backdrop for a conference focused on insurance exchange issues that America's Health Insurance Plans
held on Thursday in Washington.
“Enrollments have gone up exponentially, which is wonderful,” said Jane Good, Aetna's
program director for service operations technology solutions. “It feels a little more comfortable. We've got our stride.”
Good told attendees that the troubled opening weeks of the state- and federally run exchanges had been an “interesting adventure in the trenches.” But she offered an optimistic assessment of the strides made since the problem-plagued Oct. 1 rollout of the state and federal marketplaces.
Good was joined by Andy Slavitt, group executive vice president for Optum, the parent company of QSSI, the lead contractor for fixing HealthCare.gov. Slavitt indicated that the top priority is making sure that insurers have accurate and complete information about individuals who have enrolled in their plans. Problems with the 834 data forms that insurers rely on to enroll customers have become a paramount concern now that significant numbers of individuals are able to sign up for coverage. It has raised fears that when individuals seek to access medical care after Jan. 1, there will be no record of their insurance coverage.
“Now is the time to make sure everyone who thinks they're enrolled in a plan is indeed enrolled,” Slavitt said.
Conference attendees also received the most recent statistical breakdown of exchange participation from McKinsey & Co. Paul Mango, the research firm's director of healthcare systems and services, cautioned, however, that the available data were still miniscule, consisting of data on just 370,000 enrollees. That's barely 5% of the 7 million individuals projected by the Congressional Budget Office to enroll in coverage by March 31.
“How statistically significant this is, it's hard to say, because it's very early,” Mango said.
There are 282 insurers selling plans on the state and federal exchanges. That's down from 307 insurers in the individual insurance marketplace in 2012, a drop of 8%, according to the McKinsey analysis. Of those insurers, 80 are new to the individual marketplace. Roughly three quarters of those new entrants are either plans that previously only had Medicaid enrollees or startup nonprofit, consumer-governed plans established by the Patient Protection and Affordable Care Act
McKinsey found little difference in pricing between legacy carriers and new entrants. In each instance, about one-third of their products were priced within 10% of the lowest cost products available. But Mango indicated that there is a “spectacular spread” in pricing for plans sold on the exchanges. That suggests insurers are dealing with a lot of unknown variables about who will ultimately obtain coverage through the exchanges.
Narrower networks is a clear trend for products sold on the online marketplaces. McKinsey found that 70% of plans available through the exchanges were either “narrow” or “ultra-narrow.” They defined that, according to Mango, as providing access to 14 or fewer of the 20 largest hospitals in a market.
Michael Leavitt, a former HHS Secretary under President George W. Bush who heads Leavitt Partners, a firm that consults on insurance exchange development, said trimming provider networks is necessary to reduce costs. Otherwise, he argued, “sticker shock” could cause the fledgling markets to fail because not enough customers will enroll. “The capacity to have narrower networks is fundamental to the success of reform,” said Leavitt, a former governor of Utah.
McKinsey also did some preliminary analysis of average premiums for newly enrolled exchange subscribers compared with assumptions about those premiums. Data were available only for the state-run exchanges in Maryland, California and Washington. The takeaway? Premiums were substantially higher than anticipated. Under the healthcare reform law, older subscribers can be charged up to three times as much as younger subscribers. “That leads us to believe early enrollees are skewed toward the aged,” Mango said.
Aetna will not renew individual and small-group health plans in 2014 that don't comply with the requirements of the healthcare reform law. President Barack Obama
recently gave state regulators and insurers the option of renewing noncompliant plans for current subscribers through 2014. Aetna is among the most active of the major publicly traded insurers in the exchanges, selling products in 16 states. Aetna President and CEO Mark Bertolini
told investors this week that it would have been too logistically complicated to renew noncompliant plans at this late stage. “We talked to the insurance commissioners and the insurance commissioners have agreed with us,” Bertolini said, according to Reuters
. “If we were to go to all those states, refile all those plans, refile all those rates and do it in time for December 23, we would have paid attention to nothing else.”
Last week, a federal judge blocked UnitedHealthcare from dropping medical providers from its Medicare Advantage health plan networks in response to a lawsuit from the Fairfield County Medical Association and the Hartford County Medical Association.
But the ruling applies only to doctors that are members of those two medical associations. United intends to move forward with eliminating providers who are not part of the protected group, according to the Hartford Courant
. UnitedHealth and other Medicare Advantage insurers have been narrowing networks across the country, which they say is necessary due to payment cuts to the program that were part of the federal healthcare overhaul. Those cuts brought per-beneficiary costs in Medicare Advantage closer to costs in traditional Medicare.Follow Paul Demko on Twitter: @MHpdemko