Will the higher prices of public health insurance exchange enrollees ease over time?

The public health insurance exchange population likely will sustain to be featured by members who are sicker and costlier in contrast to persons covered by group health policies, but sources claim most health insurers are in it for the major haul.

A latest Blue Cross Blue Shield Association study billed as the 1^st of its type discovered that individuals who enrolled in BCBS policies in the years 2014 and 2015 had more sicknesses, used primarily more medical facilities and charge more than those enrolled in BCBS policies before the public exchanges authorized under the Affordable Care Act started functioning as well as those covered by employer-sponsored health policies.

For example, persons who got health insurance recently have greater amounts of diabetes, depression and coronary artery ailment in companion to persons who had individual health insurance prior to the year 2014 and group health policies. They also were taken to the hospital more often and utilized outpatient services.

Medical prices for the newer public exchange enrollees were 18.7 percent greater in contrast to employer-based group policy members in the year 2014 and 22.3 percent higher in the year 2015, in accordance to the Blues study, which did not answer the query of whether the high disease amounts and prices will subside and alleviate uncertainties that few major health insurers might drop out of the exchange business.

“The query comes down to does this market ever stabilize in the long term to get to a point where it is either similar to employer-based coverage or at least not shockingly larger than some of the prices that you see in conventional group-based coverage?” stated Chris Sloan, Washington-based senior manager with consultant Avalere Health.

Pittsburgh-based Highmark Health, a Blues affiliate; Humana Inc. UnitedHealth Group Inc.; and Aetna Inc. all have informed losses regarded to their public exchange health insurance business.

Insurers Need Change

“The carriers have been very crucial and vocal over the changes they would like to observe in this market to make it viable,” Mr. Sloan stated. Health insurers need to change needs for particular enrollment periods, which they claim are too relaxed and permit persons to enroll in coverage when they require treatment, then drop it once they complete the treatment.

Insurers are also claiming for larger compensation from the health reform law's risk adjustment program, which transmits payments from policies with lower-risk enrollees to policies with higher-risk, more expensive enrollees.

Insurers also are growing deductibles, raising premiums and narrowing their networks to increase the exchange policies' profitability, stated Stephen Zaharuk, New York-based senior vice president at the Moody's Investors Services Inc.

Health insurers identify “that this is a long-term problem. It is going to take much longer to stabilize in contrast to we thought,” he claimed. “The insurance organizations would somehow like to pursue (the healthier) population and I consider that is what has to happen.”

Yet, sources stated that they doubt the insurers will pull out of the exchange market altogether.

“Bottom line, the insurance agencies need this to be successful,” Mr. Zaharuk claimed. The exchange business is “a great deal for the insurance agencies. It merely has to be fixed.”

“Carriers observe little future progress in this segment and I do not consider they are eager to pull out,” stated Katherine Hempstead, Princeton, New Jersey-based senior adviser to the vice president at the Robert Wood Johnson Foundation. “I consider there are ways to make better the stability of the market, and I consider that the private sector and the regulators require to work together to seek out what those methods are.”