When Policy Isn’t Put Into Practice: State-Based Marketplaces Fail to Meet Goals of Standardizing Benefit Designs

By Sabrina Corlette, Sandy Ahn, Kevin Lucia and Hannah Ellison

Earlier this year, the federal agency that operates the federally facilitated marketplaces (FFM) announced that it would be encouraging insurers to offer consumers standardized benefit designs. At each metal level (Bronze, Silver, Gold, and Platinum), plans would have a standard deductible and standard cost-sharing for specified services like a doctor’s visit, an ER visit, a hospitalization, etc. In doing so, the FFM is following in the footsteps of several state-based marketplaces (SBMs) that require insurers to offer standardized benefit designs. Both the FFM and most SBMs, however, also allow insurers to also offer non-standardized options.

For both state and federal officials, the stated goal of standardizing benefit designs is to help consumers make apples-to-apples comparisons among health plans and facilitate enrollment in a plan that is optimal for their health and financial situation. To assess whether and how this goal is being met, CHIR researchers conducted an analysis of policy guidance, consumer-facing marketplace websites, and interviews with state officials and key stakeholders in four SBM states: Connecticut, Massachusetts, New York and Oregon.

In a new report published today by the Robert Wood Johnson Foundation, the Georgetown University authors find that these states’ policy choices and website interfaces have curtailed their ability to achieve the goal of improved consumer decision-making. In particular, by allowing insurers to offer nonstandardized options in addition to standardized options and failing to use web-based decision support tools to differentiate between plan options, consumers in these SBMs have limited ability to conduct the plan-to-plan comparisons originally envisioned by policymakers and advocates.

For more on their findings, read our report here.


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