Will buyers visit exchanges?
Quarterly update offers overview of reform news
With less than 50 days until open enrollment begins on the state insurance exchanges, it looks as if Americans will have a place to shop for health coverage that offers standardized comprehensive benefits, transparent pricing, subsidies to make premiums more affordable and no discrimination based on pre-existing medical conditions. Now the question has shifted to whether these new buyers will actually visit the store and leave with a purchase.
This is among the key findings and predictions that Modern Healthcare’s editorial staff compiled in Modern Healthcare Insights: Reform Update Quarterly, a research tool that debuted this week to provide an overview of the major healthcare reform news in the second quarter and a forecast of the most important reform issues to come. The first in a series of quarterly updates, the new resource for readers examines U.S. healthcare reform from five perspectives: providers, insurance, Medicaid, economics and politics.
“Our goal in launching Reform Update Quarterly,” said Merrill Goozner, editor of Modern Healthcare and its research arm Modern Healthcare Insights, “is to bring our readers insightful analysis of every aspect of healthcare reform, and to do it in a forwardlooking and timely fashion.”
Leading this quarter’s installment is a focus on the launch of the state insurance exchanges, which are expected to sell coverage to about 7 million individuals and 2 million employees of small businesses by Jan. 1, 2014. Fears that the new marketplaces won’t be ready on time for open enrollment in October have given way to anxiety about whether consumers will actually buy the product. As the report noted, no one can predict how many uninsured Americans—many of them with limited incomes—will be willing to pay for health insurance that, even with subsidies, will likely cost far more than the penalty they would face for not buying coverage.
Against this backdrop, the Obama administration made several decisions in recent months that created some delays and confusion for the rollout of the exchanges. Where does this uncertainty—both about the pub- lic’s willingness to buy insurance and the administration’s future actions—leave insurers? As the report suggests, the bottom line for them is that to continue doing business in markets where they have a strong presence, they’ll most likely have to participate in the exchanges.
In the provider arena, some healthcare systems have been preparing for the new wave of insured patients by acquiring physician practices at breakneck speed to bolster their provider networks, but are finding it difficult to fill gaps in those networks. The quarterly report identifies a resulting trend that is likely to continue: Retail store-based clinics have used this scrambling by traditional provider networks as an opportunity to serve the urgent-care and even the chronic-care needs of the newly insured.
On Medicaid, the second quarter was marked by political battles over the law’s optional expansion of that program to more low-income adults. The nation’s hospitals led the state-by-state fights to expand Medicaid, according to the report, which noted that hospitals in the second quarter made the in-house adjustments needed to serve the newly eligible and also retrained their staff to help patients enroll at the point of care.
The last two sections of the report examine the economics and politics surrounding reform. Economists and policymakers question what has caused the recent slowdown in U.S. healthcare spending, and whether costs
will ramp up again after the nation’s economy recovers fully from the Great Recession. Chief among their questions is whether some of the law’s payment reforms—such as Medicare Pioneer accountable care organizations—have played a role in driving down cost growth.
“The Pioneer experience suggests that shifting the U.S. healthcare system from the volume-driven fee-for-service model to a value-driven model that pays for quality outcomes and value will be uneven and fitful,” the report noted.
And that uncertainty—along with the uncertainty about the public’s knowledge of the law and its benefits—could spell trouble for Democrats at the polls in 2014. At the start of the second quarter, the Kaiser Family Foundation reported that four in 10 Americans are unaware that the Affordable Care Act is still in effect.
The Obama administration used the second quarter to launch a public outreach campaign, including more than 9,000 customer-service representatives ready to provide help through a toll-free number. These efforts from the administration lead back to where this discussion began: Will Ameri- cans—both figuratively and literally—buy into the law?
Modern Healthcare Insights: Reform Update Quarterly developed from a Modern Healthcare project that began in the second quarter. On Monday through Friday each week, reporters apprise readers of the latest developments in healthcare reform through daily Reform Updates at ModernHealthcare.com, with each day devoted to one of the five topics. Intended to summarize the most notable events of the week, the capsules also signal what’s ahead by providing predictions that are based on reporting and analysis.