Race to October: Health Insurance Marketplace Readiness

By Allison Johnson

The October 1 deadline for the new health insurance marketplaces is less than five months away and collaboration between the states and federal agencies continues apace. On Tuesday May 7, the National Institute for Healthcare Management Foundation hosted a webinar on state marketplace development and the major milestones left to meet before open enrollment begins. Presenters included Dr. Mandy Cohen, Senior Advisor to the Administrator of the Centers for Medicare and Medicaid Services; Lourdes Grindal Miller, Acting Director of the Division of Plan Management and Operations at CCIIO; Scott Keefer, Vice President of Public Policy and Legislative Affairs at Blue Cross and Blue Shield of Minnesota; and Rosemarie Day, President of Day Health Strategies. Presenters emphasized the recent accomplishments at both the state and federal level, but also highlighted a number of significant concerns related to final steps of implementation.

Going into 2014, 24 states and the District of Columbia have been conditionally approved to run their health insurance marketplaces in full or in part. Ms. Grindal-Miller presented the implementation timeline for both the federally run marketplaces and the state partnerships. States and HHS plan to have initial reviews of qualified health plan (QHP) applications completed by early June for the federally facilitated marketplaces. This will provide issuers approximately a month to revise their proposals and HHS intends to make certification decisions and sign agreements by early September.

Ms. Day’s presentation drew on her experience in setting up the Massachusetts Connector and the lessons for other states that might be drawn from Massachusetts. Above all, Ms. Day noted, consumers want simplicity in their health insurance shopping experience. In its annual reports to the Massachusetts legislature, the Connector reported that consumers want a manageable number of plans (3 to 4 plans offered by 4 to 6 carriers) with standardized benefits that make comparisons easy. Consumers also tend to pay close attention to the monthly premium cost, the co-pays listed, and whether or not their current primary care provider is already in the plan’s provider network. Even today, the majority of consumers in Massachusetts purchasing coverage from the Connector tend to buy the lowest cost plan (approximately 54 percent purchase bronze coverage while only 8 percent purchase the more expensive gold level coverage).

Overall, Ms. Day emphasized that consumer confusion and low levels of general knowledge prevail even three years since the Affordable Care Act (ACA) was passed. A Kaiser Family Foundation tracking poll conducted in April 2013 found that 42 percent of the general public is unaware that the ACA is still in effect. Of these, 12 percent believed the law was repealed by Congress and 7 percent said it had been overturned by the Supreme Court.

Beyond confusion over the ACA itself (and perhaps more importantly), consumers are still unsure how the marketplaces will operate and what, if any, benefit they will receive from participating in the new marketplaces. The Massachusetts experience showed that shopping for insurance online is a multi-visit process and in 2009, fewer than 1 in 18 consumers visiting the Connector website ended up completing a purchase online. Many people ended up buying coverage through other sources, including over the phone, with the insurance company directly, or through a broker. As the state marketplaces gear up for open enrollment they will need to continually refine and improve the processes consumers use to purchase coverage.

Finally, Scott Keefer of Minnesota Blue Cross and Blue Shield highlighted the early successes and continuing challenges facing the state as the October 1 deadline nears. Minnesota is implementing a state-based marketplace and enjoys “enthusiastic” support for the ACA from Democratic majorities in the legislature and Governor Mark Dayton. However, the 2011-2012 legislature was Republican-led and, as a result, little substantive ACA related legislation was passed. Without new legislation, Minnesota is playing catch-up on many key areas of implementation.

For example, the governing board for the Minnesota marketplace (MNsure) was appointed as recently as last week. Another more immediate issue is the state’s QHP filing deadline that falls before the Minnesota legislature closes its session. This could potentially result in mandates (including the coverage of treatments for autism) being added after applications are submitted. These types of decisions could require insurers to re-submit their forms and, according to Mr. Keefer, will impact premium amounts.

A number of other implementation issues were also addressed during the webinar including training of navigators and in-person assisters, proposed rules for the SHOP exchanges, the transition of www.healthcare.gov to a new website (www.marketplace.cms.gov) later this summer, and lingering questions over Medicaid expansion and what will happen to individuals who fall below 100 percent of the federal poverty level in states that are opting to not expand.

Overall, the webinar and presenters provided a helpful overview of the remaining challenges facing the marketplaces and highlighted the importance of understanding the unique challenges faced by individual states in preparing for market transitions in late 2013 and 2014. These challenges underscore the complex road that lies ahead of the open enrollment deadline and need for continued collaboration between federal agencies, states, and other stakeholders.

For more news and events on ACA implementation, be sure to keep up with CHIRblog!

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