As states struggle to keep health care insurance providers active in Affordable Care Act Marketplace Exchanges, many consumers who never or seldom had coverage have had their own problems adapting, an industry expert said during a recent interview.
"One of the things we're seeing is that people are having to be more informed about their coverage and how it works," Nate Purpura, director of public relations and communications for eHealth, Inc, the nation's largest private online health insurance marketplace, told Patient Daily. "Right now, people are having coverage-illiteracy problems."
That sharp learning curve has consumers fumbling with, misusing and, at times, abusing their coverage, which is contributing to health care insurance-provider decisions to raise premiums and scale back participation in the federally mandated program, Purpura said.
"This is an evolving marketplace," Purpura said. "I know that's the understatement of the year, but that's where we are."
The Affordable Care Act, also commonly known as "ObamaCare," is the sweeping health care reform legislation signed into law by President Obama in 2010 after a protracted and nasty struggle with Congress and a nationwide debate. The law is supposed to expand and improve access to healt care, while also curbing spending through various taxes and regulations.
Initial numbers were impressive, and the law reached its goal of providing coverage to some of the previously uninsured. More than 15 million U.S. citizens who didn't have coverage before the Affordabe Care Act had health insurance by the end of the open-enrollment period in 2014. That dropped the percentage of uninsured adults in the U.S. from 18 percent to 13 percent.
For many of the newly insured, this previously unavailable option was difficult to get their heads around.
"It isn't fair to put someone in the market, to give them something complicated that they haven't had to deal with before, and then expect them to just immediately understand it," Purpura said.
One of the greatest points of confusion has been whether individual plans cover prescriptions. While some plans do cover prescriptions, not all do, and those that do cover those costs often require that a deductible be met first, Purpura said.
People who have had health care insurance before tend to be more familiar with the nuts and bolts of health insurance that have baffled and alarmed a large number of the newly insured, many of whom are poor, which was why they hadn't had coverage before.
"That's a significant amount of money out of pocket," Purpura said. "Especially if you're not expecting it."
While that caused many to feel discouraged and distrustful of their coverage, it was not the only problem caused by low-information health insurance consumers, Purpura said. Others, perhaps because they didn't understand how health insurance coverage works or in an attempt to game the system, would purchase health insurance to handle a pending illness or condition, then stop paying premiums once that issue had been resolved.
Others didn't understand that insurance coverage generally requires annual enrollments and, as a result, their coverage lapsed. The Affordable Care Act also has been plagued by lax or irregular enforcement, Purpura said.
Consumer insurance illiteracy may have contributed to decisions announced in the last few months by several health care insurance providers to dramatically scale back participation in Affordable Care Act Markeplace Exchanges in many states in 2017. Pinal County, Arizona, has become the best known worst-case scenario because no health care insurance providers are expected to offer plans in that county under that state's exchange in 2017.
In places where health insurance providers currently say they'll continue to offer plans in 2017, many are doing so while jacking up premiums. Since the Affordable Care Act mandates that most U.S. citizens acquire and maintain health insurance coverage, or face fines and other penalties, little choice and higher premiums are considered very onerous.
Tennessee is another part of the nation where problems with the Affordable Care Act are very critical, with one state official saying it's very near collapse. Of the 95 counties in that state, residents in 57 will have only one option for a health insurance provider, the nonprofit Blue Cross Blue Shield, starting in 2017.
"Larger forces are at work as health care costs across the U.S. continue to escalate," Kevin Walters, spokesman for the Tennessee Department of Commerce and Insurance, told Patient Daily. "Like many other states, Tennessee has struggled to curb its growing health care costs. Tennessee consistently has placed among the highest states in terms of risk scores, meaning that insurance-claims costs per enrollee have been higher here than across the nation."
While health care insurance providers have been dealing with those costs, they've also been receiving premiums from Tennesseans, who have, since 2014, enjoyed some of the lowest rates in the country, Walters said.
"The situation has not reached equilibrium," Walters said. "Some of the biggest cost drivers are more frequent utilization of health care services, greater percentages of insureds with chronic diseases, the age of the Federally Facilitated Marketplace (50 percent of the FFM population is over 45) and rising pharmacy costs (particularly specialty drug prices increasing, i.e. the hepatitis C drug Sovaldi)."
All considered, it isn't surprising that health insurance providers are reporting hundreds of millions in losses and are pulling out of some markets, Purpura said.
"It's not a sustainable business for them," Purpura said. "Right now, the ones who are staying, like Blue Cross Blue Shield, they're doing it because they feel they should do it."
eHealth: 'Coverage-illiteracy' among insured fueling marketplace failures
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