Summer vacation is over, but we’re still in research paradise. This August, researchers produced helpful resources on premiums and cost-sharing for working families, interventions to increase enrollment, the impact of the Affordable Care Act (ACA) on coverage gaps, and surprise billing prevalence.

Rae, M, et al. Tracking the Rise in Premium Contributions and Cost-Sharing for Families with Large Employer Coverage, August 14, 2019. Researchers with the Kaiser Family Foundation’s Peterson-Kaiser Health System Tracker analyzed health benefit claims to see how rising premiums and cost-sharing affects employers and employees of large companies.

What It Finds

• Employees’ financial responsibility for health coverage – a combination of worker premium contributions and cost-sharing for employees and their families – has increased 18 percent over the last five years (up to $7,726 in 2018), significantly outpacing inflation and wage increases over the same period.
• Total average health spending on premiums and cost-sharing by large employers and their employees has more than doubled from 2003 to 2018, rising from over $10,000 to over $22,000.
• Deductibles accounted for over half of employees’ cost-sharing expenses in 2017, up from 20 percent in 2003, and deductible payments have increased over ten times faster than the rate of inflation.
• Employers are contributing 51 percent more to employee premiums than they were 10 years ago, but employee total health benefit contributions (including premiums and cost-sharing) rose 67 percent while only seeing a 26 percent wage increase over the same time period.

Why It Matters

Health care costs are at an all-time high. Employer-sponsored insurance (ESI), although historically popular and affordable for Americans under 65, is not immune. While employers attempt to grapple with rapid provider consolidation and rising health costs, employer-sponsored health benefits have deteriorated more than any other type of comprehensive health insurance, leaving a growing population of employees underinsured. Studies like these emphasize the urgency of policies that lower the price of health care in order to ameliorate the financial distress placed on American families due to employer cost-shifting.

Domurat, R, et al. The Role of Behavioral Frictions in Health Insurance Marketplace Enrollment and Risk Evidence from a Field Experiment, National Bureau of Economic Research, August 1, 2019. While the ACA has helped reduce the number of uninsured by over 20 million people since 2010, the law’s insurance exchanges have struggled to achieve their projected enrollment. To evaluate methods to increase marketplace enrollment, researchers with the University of California at Los Angeles and California’s state-based marketplace (Covered California) tested four levels of interventions:

• Basic Reminder – Consumers received a mailed reminder of the dates for Open Enrollment as well as the website and phone number for Covered California.
• Subsidy and Penalty – In addition to the basic reminder, the letter sent to consumers included their estimated subsidy based on reported household size and income.
• Price Compare – In addition to the information provided in the first two interventions, the letter includes a table displaying the available Bronze- and Silver-level coverage options in their area, plus estimated premiums after the consumer’s applicable subsidies.
• Price and Quality Compare – Quality ratings are added to the table listing available plans and prices.

What it Finds

• Across all four intervention levels, enrollment increased by 16 percent above the control group take-up rate.
• The basic reminder increased take-up by 11 percent, and the subsidy and penalty reminder increased take-up by 19 percent.
• The letters led to an overall decrease of 6.3 percent in average morbidity across the marketplace risk pool.
• The total estimated increase of willingness-to-pay for coverage across intervention levels was $25 to $54 per month, while the letter only cost $0.69 cents to mail, giving the intervention a significant return on investment.

 Why it Matters

Studies have shown that marketing and outreach are associated with higher enrollment rates on the ACA’s marketplaces, and greater marketplace enrollment is key to market stability. This study shows that a low-cost, passive intervention can make a significant impact on enrollment and the risk profile of the marketplace.

Courtemanche, C, et al. The Impact of the ACA on Insurance Coverage Disparities After Four Years, National Bureau of Economic Research, August 1, 2019. Using data from the American Community Survey between 2011 to 2017, economists analyzed the effects of ACA reforms such as the Medicaid expansion, premium tax credits, and new insurance market standards on alleviating coverage gaps.

What it Finds

• Between 2014 and 2017, Medicaid expansion increased the proportion of residents with coverage by 5.1 percentage points.
• The ACA’s coverage reforms other than Medicaid expansion, including marketplace subsidies, increased coverage by 3.6 percentage points.
• Specific to private insurance, the ACA increased coverage by 2.8 percentage points, driven by a 1.8 percentage point increase in ESI and a 1 percentage point increase in individually purchased coverage.
• The full ACA implementation reduced the low-income coverage gap by 44 percent, the racial coverage gap by 26.7 percent, the unmarried coverage gap by 45 percent, and the young adult coverage gap by 44 percent.
• Coverage gains slowed in 2017 due to reduced growth in private insurance, which may be partially attributed to the aftermath of the 2016 presidential election (researchers noted that more research is needed, however, to fully understand the effects of the Trump Administration on private health coverage).

Why it Matters

It is important to understand both how the ACA contributed to increased insurance coverage and the gaps that remain. This study documents the historic impact the health law has had in both private and public insurance growth. Given repeated attempts to repeal the ACA as well as efforts to roll back the law’s major reforms, policymakers should take note of the coverage gains at stake in the continuing health care reform debate.

Sun, E, et al. Assessment of Out-of-Network Billing for Privately Insured Patients Receiving Care in In-Network Hospitals, JAMA Internal Medicine, August 12, 2019. Researchers with Stanford University analyzed national data of almost 5.5 million inpatient admissions and roughly 13.6 million emergency department (ED) visits to in-network hospitals between 2010 and 2016 to evaluate the occurrence of out-of-network (OON) billing.

What it Finds

• The incidence of OON billing for ED visits to in-network hospitals increased from 32.3 percent in 2010 to 42.8 percent in 2016, while patients’ potential financial responsibility for the resulting bill increased from an average of $220 to $628 over the same time period.
• The incidence of OON billing for inpatient admissions increased from 26.3 percent in 2010 to 42.0 percent in 2016, and patients’ average potential financial responsibility over the same period increased from $804 to $2,040.
• Some of the specialties most commonly involved in OON billing for ED visits include emergency physicians, internists, and anesthesiologists.
• Ambulance transport for ED visits often resulted in OON billing, with 85.6 percent of ambulance service encounters resulting in an OON bill to the patient.

Why it Matters

Out-of-network billing, or surprise medical bills, is a hot-button issue in the media and across federal and state legislatures. This study illustrates the increasing prevalence of OON billing, and the associated increase in financial consequences for consumers in a time where 40 percent of Americans can’t afford a $400 emergency. This study helps to highlight the urgency of a public policy solution to this problem.