The Next Chapter of Obamacare
http://healthpolicyandmarket.blogspot.com/2014/09/the-next-chapter-of-obamacare.html
A few highlights:
We won’t know what the real Obamacare rates will be until we see the 2017 rates––when there will be plenty of valid claim data and the Obamacare reinsurance program, now propping the rates up, will have ended.
The HealthCare.gov backroom is not built yet––a year and counting after it should have been.
How many people are enrolled in Obamacare? Without a government to insurance company accounting system yet built, no one knows.
The administration says they are going to auto-renew existing Obamacare policyholders. But they don’t have a valid baseline census from which to start.
Actuarial firm Milliman put the impact of Silver baseline plan changes this way in a recent issue brief: “Even modest premium increases by market leaders of 5% could lead to materially higher net premium contribution increases of 30% to near 100% for low income [subsidy eligible] enrollees during 2015.” Milliman also pointed out, “If consumers choose to auto-enroll because of the simple process versus evaluating their options by going to the federal exchange, individuals who auto-enroll may have unexpected materially higher net premium contributions relative to payments in 2014 for the same plan.”
So, this headline about the baseline plans decreasing their rates in so many markets is more about the carriers who sold the most in the first year increasing their rates while the plans that sold very little business, and able to fall back on the Obamacare reinsurance scheme, cut their rates in a no lose attempt to gain business.
Five to ten million people all trying to get through exchange websites between November 15 and December 15? Add however many people are going to sign-up for the first time this November to all of those existing participants re-enrolling for January 1, who will all be hitting the still fragile Healthcare.gov and state exchanges during that four week period, and it is not hard to see how Obamacare could be back in the news.
While the open-enrollment is now scheduled to begin until 11 days after the November election there will be plenty of renewal and cancellation letters going out in October––not the least will be more pre-Obamacare policies being cancelled this year now that their one-year extension is up––carriers aren’t necessarily allowing policies to be extended further.
Does this all sound confusing? Just wait until we approach the next open-enrollment with millions of people hearing about all of this complexity and having just four weeks to get their enrollment validated for January 1. The Obamacare anxiety index is going to be off the charts well before November 15th.
Add to all of this bigger deductibles for 2015 (those go up with cost trend as well as the rates) and more narrow networks as well as generally larger rate increases for the plans that got the most enrollment and there will be lots to talk about.
There will also be a large increase in VA medical expenses as poor veterans signed onto VA care (from community health providers) because of the individual mandate.