The opening of the health insurance exchanges this fall has certainly put a spotlight on a few of the things that can go awry during insurance enrollment. But there are some important lessons that can be learned from it – lessons that can help employers as they begin to plan for next year’s open enrollment.
For instance, the exchanges attempted to guide consumers through the process by presenting premiums and designs of all the available plans, so quick cost comparisons could be made. That’s a good start for helping consumers choose the right plan, and a best practice already in place for most employers.
But it didn’t go far enough.
To be successful, the process is missing a key element: A truly personalized experience that would help a user get a handle on his or her specific situation – especially varying annual out-of-pocket costs, in addition to the plan premiums.
Employers have the capacity to help employees better understand those costs by providing actual claims data history during the decision-making process. That data history can paint an accurate picture of past out-of-pocket expenses. In addition, employers can ask a few questions about planned procedures and other anticipated costs for the coming year, and incorporate that information into the decision process.
Without this level of tailored, data-driven experience, your employees may simply choose a plan with the smallest premium, which doesn’t always pan out as the best option given other circumstances. Providing this type of detailed data can also help employees plan better pre-tax healthcare savings account contributions, too, and minimize surprises.
Of course, doing everything you can to help employees select their best-fit plan has benefits for your organization, as well. Employers using Truven Health Analytics personalized enrollment tools have seen results like a 60 percent decline in the number of over-insured employees and a 20 percent increase in consumer-driven health plan enrollment.
For more ideas on how to make next year’s open enrollment successful for both your employees and organization – despite growing complexities and costs – check out our complimentary insights brief, Six Best Practices for Open Enrollment.
Director, Product Management
In the article titled “Obama: Healthcare as easy as online shopping” from the Los Angeles Times, the idea of a Kayak.com-like experience is touted as the way that the new healthcare marketplace is going to work for the millions of Americans who will seek health insurance in the next several months. There is a key element of personalization missing from this concept of point, click, and shop experience that the White House is promising. They are stating that an uninsured person will now have the ability to compare plans and determine which plans will “work for your family.” I believe only half of this to be true. The fact is that users of the marketplace will indeed be able to view premiums and plan designs of the available plans. However, will this really mean anything to a person that has possibly never had health insurance?
The key component that is missing is a personalized experience to help the user understand what his or her out-of-pocket expenses might be. Health insurers have been showing individual shoppers monthly premiums for comparison purposes for years, so, this is really nothing new. What would be new and progressive is if these sites also helped the user understand what the total, annual out-of-pocket expenses (in addition to the premium) could be. By answering a few simple questions about chronic conditions, planned procedures and overall planned healthcare use, a user could be given a rough estimate of total out-of-pocket expenses. This could show the differences between a traditional PPO plan and a high-deductible plan. Without this shopping experience, the vast majority of these healthcare neophytes will elect to choose the plan with the smallest premium. This could cause financial woes once the medical bills start arriving.
In addition to the missing element of personalization, the marketplace is having a tough time handling the volume. The government was expecting a trickle into the marketplaces during the six month enrollment period. After visiting www.healthcare.gov the evening of October 1 and the morning of October 2, I was greeted with the following message:
“We have a lot of visitors on the site right now. Please stay on this page. We’re working to make this experience better, and we don’t want you to lose your place in line. We’ll send you to the login page as soon as we can. Thanks for your patience!”
Based on my experience it appears they weren’t ready for the volume they are receiving. It should be an interesting next six months to say the least…
Director of Product Managemen
An article last week in the Washington Post (“Hospitals Emerging as Powerful Healthcare Sales Force,” by Jay Hancock, Sept. 13, 2013) explored a growing trend in the world of healthcare reform — the role of hospitals in recruiting newly eligible consumers for insurance coverage.
As the new health insurance exchanges, or marketplaces, open for business next month, research from Truven Health about the Accountable Care Act shows that an additional 21 million people will be eligible for coverage in 2014.
For hospitals, that number represents potential revenue from a fresh, newly covered market — new revenue from patients who did not seek out medical care in the past because of financial barriers, and from uninsured people who sought out care but couldn’t pay their medical bills.
Obviously, then, it’s a smart move for hospitals to help those new consumers enroll in coverage. But there are other reasons why this trend is positive:
Another important benefit for consumers is that once a hospital helps a person get enrolled in a plan, he/she can take advantage of preventive care. That should mean less ER visits — and better chronic condition management.
- Hospitals and health plans need each other to impact higher-quality care. In the past, hospitals and health plans worked for opposite incentives. Hospitals were rewarded for higher numbers of services performed. Health plans wanted to keep the number of services rendered low. Now as a result of reform that rewards quality, not quantity of care, the two entities are coming together — particularly when partnering in risk contracts — to figure out how to measure, manage, and deliver higher-quality outcomes. The trend is indicative of the transformation going on in healthcare as we move from a fee-for-service to a value-based purchasing model.
- Hospitals must do whatever it takes to protect their market share. It makes good business sense for hospitals to protect their existing market share in a complex environment where things are changing rapidly. Closely partnering with insurance plans and helping patients find the best plan for them are two avenues to prevent erosion and boost patient loyalty and engagement.
- Patients will ultimately benefit. A lack of transparency has been a problem — with different contracts for different plans driving care costs. But with stronger affiliations between hospitals and health plans, transparency should increase, with consumers gaining a better understanding of price points.
In addition, hospital-health plan alignment paves the way toward better population health data and analytics — which the hospital can act on to improve overall community health.
Finally, the fact that hospitals are actively recruiting for exchange plans is directly tied to healthcare’s overall bottom line. The more people who are insured, the fewer write-offs are needed. That should trickle down to better pricing for consumers. But for that to happen, the new exchanges need to sign up enough of the newly eligible — many of who are young, healthy people who don’t see a need to enroll. The more recruiting help exchanges get from all sides, the better for all consumers.
Note: For more information on the population that is newly eligible for coverage through health insurance exchanges, view our infographic, “Unmasking the Uninsured Population in Your State.”
Michael L. Taylor, MD FACP
Chief Medical Officer
After years of selling insurance plans in large measure to private employers, the ACA now requires private insurers to begin selling to individuals. The ACA has mandated public Health Insurance Exchanges within which qualifying employees will pick and choose from among multiple insurance plans within their market. This represents a radical, disruptive change in the health insurance market.
Of special interest to many employers (and employees for that matter) is the simultaneous development of private insurance exchanges wherein employers contribute a fixed amount toward a health policy but then have the employee choose the level of plan and the insurer they prefer.
It is hard to imagine a more disruptive model to the health insurance industry’s historical approach to selling insurance. It is also difficult to imagine a more exciting time in the health care industry. Let’s all stay tuned!
William Bithoney, MD
As the October 2013 open enrollment date for insurance marketplaces approaches, more information is emerging on how states are managing the premium rates set by health insurers. Maryland is an example. As a recent Washington Post article noted, this state is working diligently to ensure affordability for consumers in its market.
Questions remain: How easily does the open enrollment work for consumers? And are states or the federal government able to support consumers as they navigate the healthcare maze and try to understand their out-of-pocket costs and assess the best plans for their situation? Consumer understanding of plan design options and their associated costs, as well as their subsidies, will be the ultimate test of the work states and federal government did to keep rates low. We’ll know in October whether consumers were adequately supported.
Vice President Market Planning and Strategy