Why mil­lions buy cov­er­age off the ACA ex­changes

Modern Healthcare - - NEWS - By Bob Her­man

Kelly Fris­toe, CEO of Fi­nan­cial Part­ners in Wi­chita Falls, Texas, helps peo­ple buy health in­sur­ance both on and off the Af­ford­able Care Act ex­changes. He helps cus­tomers de­ter­mine whether it’s more ad­van­ta­geous to buy an ex­change plan, with or with­out a pre­mium sub­sidy, or to buy di­rectly from in­sur­ers and bro­kers of­fer­ing off-ex­change plans.

“Right there at 400% (of the fed­eral poverty level), it could go ei­ther way,” Fris­toe said. It de­pends on plan de­sign, other an­cil­lary costs and some­times the cus­tomer’s po­lit­i­cal views about the health­care law.

In­stead of one seam­less mar­ket for in­di­vid­ual in­sur­ance, the ACA has gen­er­ated two dif­fer­ent mar­ket­places for the same type of prod­uct, said Kather­ine Hemp­stead, direc­tor of health in­sur­ance re­search at the Robert Wood John­son Foun­da­tion. In­sur­ers are sell­ing mil­lions of plans to peo­ple off the ex­changes, which has got­ten far less at­ten­tion than the ex­change busi­ness, even though the two mar­kets are about the same size.

HHS said last Novem­ber that 8 mil­lion to 12 mil­lion Amer­i­cans had in­di­vid­ual of­fex­change cov­er­age. That’s about half of the en­tire in­di­vid­ual mar­ket. On- and of­fex­change en­roll­ment varies by state, and is mostly tied to the la­bor mar­ket and in­sur­ance reg­u­la­tions, Hemp­stead said.

Hu­mana re­ported last month it had 731,000 on-ex­change plan mem­bers as of March 31, com­pared with about 213,000 off-ex­change mem­bers. That may seem like a small num­ber for the off-ex­change mar­ket, but it’s ac­tu­ally a 62% in­crease from the pre­vi­ous three-month pe­riod that ended Dec. 31.

Peo­ple who don’t qual­ify for sub­si­dies may de­cide to buy an off-ex­change plan be­cause that’s what they have done be­fore. Out of pocket-costs for off-ex­change plans are higher than for ex­change plans, mostly be­cause pre­mium sub­si­dies don’t ap­ply.

Some con­sumers who would qual­ify in­di­vid­u­ally for sub­si­dies stay away from the ex­changes be­cause of the ACA’s so­called fam­ily glitch, which dis­qual­i­fies them for pre­mium sub­si­dies for fam­ily cov­er­age. They may buy off-ex­change plans that are more af­ford­able than those they can get through their job and more ap­peal­ing than non-sub­si­dized ex­change plans. Es­ti­mates of those af­fected by the fam­ily glitch range from 2 mil­lion to 4 mil­lion.

Fris­toe says oth­ers pre­fer off-ex­change cov­er­age sim­ply be­cause they are po­lit­i­cally op­posed to the ACA. “A lot of folks down here are not happy with the ad­min­stra­tion. They are not happy with this law. They take a stance and say, ‘We don’t want none of that Oba­macare stuff.’ And I’m like, ‘Re­ally, peo­ple?’ Gosh.”

“A lot of folks down here are not happy with the ad­min­is­tra­tion. They are not happy with this law. They take a stance and say, 'We don't want none of that Oba­macare stuff.' And I'm just like re­ally, peo­ple? Gosh.” Kelly Fris­toe Pres­i­dent Fi­nan­cial Part­ners

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.