'Obamacare' Starts In 91 Days
By Sarah C. Threnhauser Executive Vice President, OPEN MINDS July 3, 2013
Developed by OPEN MINDS, 163 York Street, Gettysburg PA 17325, www.openminds.com. All rights
It seems like only yesterday we were reading The Patient Protection & Affordable Care Act legislation for the first time (see Health Care Reform Brings Significant Changes in Services To SMI Population premium members and Health Care Reform Legislation to Reshape Medicaid, Including More Managed Care premium members) - and then waiting for the Supreme Court decision that would determine its fate (see Supreme Court Ruling On The Patient Protection & Affordable Care Act premium members and Individual Mandate Stays – SCOTUS Puts State Medicaid Expansion In Play all members).
Now, we're 91 days out from the launch of one of the most ambitious portion of the PPACA - the health insurance exchange marketplaces. The health insurance marketplaces, which will allow individuals to compare and purchase health insurance policies with baseline levels of coverage, were designed to provide a streamlined system of health insurance coverage. Enrollment in the insurance marketplaces is set to begin on October 1, 2013. States have three options when it comes to operating the health insurance marketplaces: they can operate the marketplace on their own, they can operate in partnership with the federal government, or they can let the federal government run the marketplace entirely.
Plans for a state-based marketplaces were due to the U.S. Department of Health and Human Services (HHS)by December 2012, and plans for a federal/state partnership were due by February 2013 (see Status of State Health Insurance Exchange Implementation premium members).
As of December 2012, this is what the states have planned:
- 17 states (including the District of Columbia) had applied to operate state-run health insurance marketplaces, all of which have been conditionally approved by HHS
- Six states are planning to operate a state partnership exchange, and their plans have been conditionally approved by HHS
- 27 states will default to a federally-facilitated exchange marketplace
It is important to note that there are two types of insurance marketplaces - one for individuals and one for small businesses. Up until last month, these two marketplaces were tied together - either the state ran both or the federal government ran both. But last month, the federal Centers for Medicare and Medicaid Services (CMS) released a new proposal that would allow the federal government to run the individual marketplaces, and the states to run the small business marketplaces (see CMS Proposes Change To Health Insurance Marketplaces, Offers Split Operations Between Feds & States premium members). Most states haven't yet reacted to this new proposal, so we won't know its potential impact for a while.
What does all of this mean? For three important groups, the start of enrollment in the insurance exchange marketplaces will mean big changes:
For consumers - Through the insurance marketplaces, consumers will have more coverage options - and increased transparency about those options. Marketplaces will allow consumers to compare plans based on price and quality, which could potentially lead to comparison shopping and increased competition among insurers. The marketplaces also have the potential to give consumers lower cost options - a recent analysis found that premiums for insurance bought through the insurance marketplaces are lower than original federal estimates (see State's Health Insurance Marketplace Premiums Lower Than Federal Estimates premium members).
For employers - Whether to continue with employer-sponsored coverage is a big decision for many employers going into 2014. The big question is, will health care reform drive up health benefit costs, and in turn drive employers to drop coverage? The "answers" available, however, have reached markedly different conclusions. Some predictions see employers moving away from providing health insurance plans to their employees, while others see very few employers dropping coverage (see How Will Employer-Sponsored Health Coverage Change After 2014? Assessing The Future Scenarios premium members).
For service provider organizations - More individuals with insurance means more potential consumers. Some estimates indicate that there may be as many as 12 million newly insured individuals purchasing insurance through the exchange marketplaces (Health Insurance Exchanges Expected To Generate $205 Billion In Annual Premium Revenue By 2021 premium members). Additionally, PPACA requires that all health insurance plans sold through the health insurance exchange marketplaces include coverage of a list of essential health benefits, including mental health and substance abuse treatment (How Do You Define "Essential"?: How Recent Decisions On Essential Health Benefits Will Affect The Field premium members). These consumers will be looking for treatment options from provider organizations under the plans they've purchased on the insurance marketplaces.
Stay tuned through the summer and fall as we keep you updated on this rapidly approaching milestone in the health and human services industry - as well as explore the ways provider organizations can adapt to the new market pressures and requirements. And, tune in tomorrow when we look at new initiatives by the federal government to promote the health insurance marketplaces.