Healthcare Reform Navigation: Healthcare Exchanges
Edition: April 2014 - Vol 22 Number 04
The Affordable Care Act (ACA) is making broad changes to the way health insurance will be provided and paid for in our country.
If you have been paying attention to the news during the last few months you have certainly heard about healthcare.gov, which is the federal health insurance – exchange.
The Affordable Care Act created a new way for consumers to purchase guaranteed coverage from private insurance companies through an online marketplace or exchange. Similar to how you book travel today using Priceline.com or Orbitz.com, these sites aggregate data and give the consumer several options to choose from. Here is a quick overview of how this process works.
Shop and compare
Individuals or small employers go online through their exchange and enter their personal information into a web portal. After doing so, they learn their eligibility status for available insurance programs, such as Medicaid, CHIP (Children’s Health Insurance Program), public subsidy options or employer-based insurance. The exchange allows them to shop, compare and choose the plan that is best for them based on their eligibility and needs.
These exchanges are federal- or state-government-run entities intended to create a more organized and competitive market for health insurance by offering health plan choices, common rules around plan types and pricing of insurance, and providing information to help consumers better understand the options available to them. Some states have chosen to develop exchanges on their own, others have elected to fall back on the federal program, and others have entered partnerships with other states and the federal government.
Transparency and accountability
The goals of the program are simple: Make it easy for consumers to purchase insurance, and provide transparency and accountability among the insurance companies, using competition as a way to drive down premiums. With more patients insured, it is hoped that insurance companies can spread out their risk and offset the costs of higher-risk patients on their plans.
Initially, exchanges will serve primarily small businesses and individuals purchasing insurance on their own. There is a large focus on low- to middle-income families who are between 133 percent and 400 percent of the Federal Poverty Level. Individuals and families within this range receive government subsidies or tax credits to purchase insurance through the exchange.
All consumers have four standard plans to choose from. They range from the cost-effective “bronze” plan, which covers 60 percent of the patient’s healthcare costs, up to the “platinum” plan, which covers 90 percent of the patient’s healthcare costs. Insurers in the exchanges are not required to offer plans in all four levels, but they must offer at least one silver and one gold plan.
All policies offered on the exchanges must cover ambulatory and emergency services, hospitalization, maternity and newborn care, mental health and substance abuse, prescription drugs and pediatric care, including vision and oral.
Because of healthcare reform, insurers can no longer turn away patients with a pre-existing condition. But because these patients increase a company’s risk, insurers are intent on gaining new customers – including young people, many of whom avoid health insurance – through the exchange to minimize their risk. Also, lifetime and annual spending limits have been eliminated.
So what will the impact be on the healthcare industry? For starters, effective March 31, 2014, everyone was required to have insurance. Those without it will be subject to fines for non-compliance.
Regardless of how many people purchase insurance, there may be an influx of newly covered patients into the healthcare system. Health systems hope those newly covered patients will help them offset the cost of care they currently provide to those without insurance or underinsured. The goal is to drive down the overall costs of healthcare.
How will providers react? They will continue to focus on “Triple Aim.” Developed by the Institute for Healthcare Improvement, or IHI, the Triple Aim describes an approach to optimizing health system performance by 1) improving the patient experience of care, including quality and satisfaction; 2) improving the health of populations; and 3) reducing the per-capita cost of healthcare. All while maintaining a focus on the patient.
Primary care is the new gateway
With emergence of accountable care organizations (ACOs) and patient-centered medical homes, primary care will become the new gateway to care. Many of these newly insured will work to become established with a primary care physician, while others will wait until they are hurt or sick to seek care through a primary care physician or emergency room visit.
With more insured patients entering the healthcare system, providers will need assistance dealing with these new patient volumes in a changing healthcare environment focused on the Triple Aim and patient-centered care.
MDSI – the parent company of Repertoire – has developed the Healthcare Reform Navigation Series, an online program designed to make the task of preparing your organization for 2014 and beyond easier. This series will help you and your team with online courses that explain many of the key elements integral to understanding reform and the transformation from fee‐for‐service to fee‐for‐value. The program includes a 12-month schedule of topics and live sessions with industry experts.
To learn more about the Healthcare Reform Navigation Series, contact Tim Brack, director of training, education and meetings, at 770.263.5270 or firstname.lastname@example.org.