This November, we at CHIR celebrated Thanksgiving with a Research Buffet. The cornucopia of studies looked at issues including health insurance literacy, the financial implications of subsidized health insurance, the impact of the Affordable Care Act (ACA) on American workers, and Medicare Advantage.

Tipirneni, R., et al. Association Between Health Insurance Literacy and Avoidance of Health Care Services Owing to Cost. JAMA; November 16, 2018. The ACA requires health plans to cover a minimum set of essential health benefits, which include preventive services that must be provided with no enrollee cost sharing. Following up on a study showing that low general health literacy has a negative effect on access to health care, researchers at the University of Michigan tested the effect of low health insurance literacy on the uptake of free preventive services.

What It Finds

• Thirty percent of study respondents reported postponing or skipping care in 2016 due to the perceived cost of care.
• Roughly 16 percent of study respondents postponed or skipped free preventive services such as annual physicals, flu shots, cholesterol checks, colon cancer screenings, mammograms, and Pap smears.
• Lower health insurance literacy was associated with a higher likelihood of either delaying or forgoing both preventive and non-preventive care due to cost, even though preventive care was free.
• Consumers in high-deductible health plans were more likely to avoid both preventive and non-preventive services than those in other types of health insurance plans.

Why It Matters

The ACA expanded access to preventive services in order to help consumers avoid high-cost medical conditions down the road. Preventive services like cholesterol screenings, Pap smears, and annual physicals can help identify and treat certain medical conditions early on, allowing patients to more effectively manage their condition and improve outcomes, while reducing high medical bills. Given the association found in this study between health insurance literacy and the uptake of preventive services, policymakers, payers, employers, and providers alike should develop and deploy strategies to improve consumers’ understanding of insurance policies to improve public health and avoid unnecessary spending.

Gallagher, E., et al. The Effect of Health Insurance on Home Payment Delinquency: Evidence from ACA Marketplace Subsidies. Social Science Research Network; November 27, 2018. Using tax data and survey responses, researchers evaluated whether the ACA’s premium subsidies have had an effect on home rent and mortgage payments. The researchers compared the experience of consumers in states that expanded Medicaid to those living in non-expansion states. Consumers between 100 and 138 percent of the federal poverty line are covered by Medicaid in expansion states, but only eligible for the ACA’s premium tax credits in non-expansion states. This study evaluated the influence of premium tax credits on these consumers’ ability to maintain home payments in non-expansion states, using the experience of consumers in expansion states as a baseline.

What It Finds

• Among households eligible for the ACA’s premium subsidies, subsidy eligibility was associated with an estimated 25 percent decline in home payment delinquency rates along with a reduced exposure to out-of-pocket expenditure risk.
• Results suggest that the relationship between ACA premium subsidies and decreased home payment delinquency rates is causal, indicating that access to premium subsidies offers some protection against falling behind on home payments for low-income households.
• At the income threshold for receiving financial help with premiums, the probability of having any health insurance jumps 35 percent among households targeted by the ACA’s premium subsidies.
• Under the assumed social costs of home payment delinquency, 33 percent of the expected annual transfer value of subsidies is offset by the lower rate of delinquencies.

Why It Matters

This study helps to measure the social welfare effect of the ACA premium tax subsidies, a federal policy that has prompted debate amidst talk of ACA repeal and replacement. We already know that premium subsidies offer significant financial protection to consumers, and have been linked to a decrease in financial burdens. In this study, researchers find that the money saved through access to subsidized coverage and the financial protection of health insurance leads to lower home payment delinquencies, offsetting one-third of the cost to provide such subsidies through social welfare savings. Policymakers should consider the downstream impacts of premium subsidies before reducing or curtailing such benefits.

Gangopahyaya, A., et al. How Have Workers Fared Under the ACA? Urban Institute; November 8, 2018. A popular argument against implementing the ACA’s reforms was that employers would reduce work hours and overall employment or push employees out of job-based coverage and into the government-subsidized individual market. Researchers with the Urban Institute assess whether the coverage gains during the first six years of the health law were associated with changes to labor market outcomes.

What It Finds

• From 2010-2016, coverage rates among the employed increased from 81.6 percent to 89.4 percent, with eleven million more workers covered in 2016 than if the ACA was not in effect.
• Within an occupation, no association was found between changes in worker coverage rates and changes in employment levels, the number of hours worked, or weekly earnings between 2010-2016
• Approximately 9.4 million workers, or 85 percent of those who gained coverage between 2010-2016 accessed coverage through non-employer coverage such as the individual market or Medicaid; occupations that experienced greater increases in non-employer coverage also experienced increases in employer coverage.
• The workforce saw an 8 percent increase between 2010-2016, with almost all occupations gaining more workers during this timeframe.

Why It Matters

Whether or not the ACA is detrimental to workers is an important element of the law’s political sustainability. Although some policymakers predicted that the employer mandate and the introduction of subsidized would cause harm in the workforce, this study shows that these concerns have not been borne out.

Neuman, P. and Jacobson, G. Medicare Advantage Checkup. New England Journal of Medicine; November 29, 2018. Since 2005, enrollment in Medicare Advantage, the private-plan alternative to traditional Medicare, has increased from 6 million to 20 million beneficiaries. In this publication, researchers analyze the current state of the program to determine how Medicare Advantage measures up to traditional Medicare and whether the program is achieving its established goals, and identify ongoing challenges.

What It Finds

• Only 10 percent of Medicare Advantage enrollees switch plans each year. This lack of movement could prevent insurers from designing competitive products, potentially leading to higher premiums, cost sharing, and fewer benefits.
• Currently, Medicare payments to Medicare Advantage plans are approximately equal to the per-capita costs of traditional Medicare.
• Quality across Medicare Advantage plans varies, with non-profits, HMOs, and hospital-run plans outperforming their counterparts.
• Medicare Advantage plans generally score better on preventive services and screening measures than traditional Medicare, and have been found to have better outcomes with post-acute care, such as fewer hospital readmissions; however, there is little information on quality outcomes for high-need patients, who have shown higher disenrollment rates.

Why It Matters

Medicare Advantage has been suggested as a model for a Medicare for All or similar system that could gain bipartisan support. However, this analysis finds that although Medicare Advantage expands plan choice greatly for most people, the program is not necessarily saving the federal government money, and there are some concerns about the quality of care when compared to the traditional program. As policymakers consider ideas that involve extending Medicare coverage to the entire nation, understanding how Medicare works for those currently enrolled will be key to crafting a successful policy.