Navigating Health Insurance Exchanges

Key Questions and Implications for Providers

Topics: Health Insurance Exchanges, Health Policy, Market Trends, Strategy, Payer and Regulatory Policy, Point-of-Service Collections, Revenue Cycle, Finance, Primary Care, Service Lines

We recently updated this white paper to include:

  • New analysis of recently released premium rates for the exchanges and how subsidies will reduce the burden on many consumers
  • Why providers should be aware of the 90-day "grace period" and place an even greater emphasis on insurance verification
  • How the "family glitch" interacts with premium assistance subsidies and may affect over 500,000 uninsured children
  • Updated application and enrollment deadlines to ensure coverage begins on Jan. 1, 2014, for newly covered patients
  • Health Care Advisory Board, Financial Leadership Council, Physician Practice Roundtable, and Payment Navigation Compass members, log in to download the white paper.

Executive Summary

The ACA's health care exchanges—the largest expansion of health insurance availability since the advent of Medicare and Medicaid in 1965—are expected to cover 24 million Americans by 2016. As of Oct. 2013, 16 states will operate their own exchanges, 7 will partner with the federal government, and 27 will default to federal exchanges.

25% of uninsured Americans are more likely to pay the non-compliance penalty than obtain health insurance.

All lawful residents living in the United States who are not currently incarcerated are allowed to purchase on the exchanges, but 6 out of 7 people expected to do so will be eligible for subsidies provided by the federal government.

Because fines for not purchasing insurance will be lower than premium costs for most individuals, those with incomes between 100% and 400% of the federal poverty level and who expect high medical costs are the most likely to purchase insurance on the exchanges. If young, healthy people choose to pay penalties rather than purchase insurance, then risk pools may be overwhelmed by older, less-healthy consumers.

The majority of enrollees are expected to purchase insurance using the HHS online marketplace, but individuals can also purchase coverage over the phone, in person, and through traditional insurance brokers.

So the exchanges are live. What happens now?

On Oct. 1, open enrollment began in most marketplaces and will last until March 31, 2014. Consumers wishing for coverage to begin on Jan. 1, 2014, must pay their first premiums by Dec. 15, 2013. Moving forward, registration must be completed by the 15th of the month for coverage to begin the following month. Any coverage purchased after the 15th of the month will begin the month after next.

After the initial open enrollment period, eligible individuals may only enroll or switch plans due to triggering events. These events include losing minimum coverage, change in family status or citizenship, income fluctuation affecting cost-sharing/premium assistance, and permanent relocation that offers access to new QHPs.

People may only switch plans within the same metallic level (bronze, silver, gold, or platinum) they originally purchased. This is in place to prevent switching to a plan with a higher actuarial value before a significant medical procedure or purchasing a lower value plan after such an event.

Members, log in

Health Care Advisory Board, Financial Leadership Council, Physician Practice Roundtable, and Payment Navigation Compass members, log in to download the white paper.

Not a member? Visit the Health Care Advisory Board's website or contact us to learn more.