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June 26, 2014 12:00 AM

HHS announces auto-enrollment for current ACA consumers

Paul Demko
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    (Story updated at 5:15 p.m. ET.)

    Individuals who signed up for coverage through the state and federal exchanges will be automatically re-enrolled in coverage for 2015, under a proposed rule issued by HHS (PDF) on Thursday. The proposal reduces the likelihood that there will be a steep drop-off among the roughly 8 million individuals who signed up for private health plans during the 2014 open enrollment period.

    "They're trying to reduce disruptions in the marketplace by basically allowing people to do nothing and stay insured," said Caroline Pearson, a vice president at the consulting and research firm Avalere Health. "That avoids having people inadvertently fall out of coverage."

    Joel Ario, managing director at Manatt Health Solutions and former director of the Office of Health Insurance Exchanges at HHS, said the decision is important because consumer research shows that most individuals won't take action on their own initiative and therefore would be likely to let policies lapse. "I think it's critical that if somebody's already gone through the process and gotten enrolled that they can stay in coverage in as many cases as possible," Ario said.

    The rules were drafted in consultation with the National Association of Insurance Commissioners and other interested parties. HHS will be taking comments for 30 days before issuing a final rule.

    Joe Antos, a healthcare policy expert at the conservative American Enterprise Institute, says that insurers will likely be cheering the decision because it will reduce their administrative burdens and make it easier to hold on to customers. "This helps the actuaries and the insurance companies," he said. "Finally there's a little stability in a completely chaotic program."

    But Antos also points out another consequence of the automatic renewal process: it solidifies market-share trends that emerged in the first year of enrollment. That's good news for insurers that saw strong enrollment, but a potential problem for those plans that struggled to gain customers or are planning to compete on the exchanges in 2015 for the first time.

    Follow Paul Demko on Twitter: @MHpdemko

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          • - Luminaries
          • - Top 25 Women Leaders
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        • Digital Health Transformation Summit
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        • Social Determinants of Health Symposium
        • Women Leaders in Healthcare Conference
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        • Top 25 Women Leaders Gala
      • Virtual Briefings
        • - Hospital of the Future
        • - Value Based Care
        • - Hospital at Home
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        • - AI and Digital Health
        • - Future of Staffing
        • - Hospital of the Future (Fall)
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