A central objective of recent U.S. health care policy reform has been to increase access to stable, affordable health insurance — most notably through the Insurance Marketplace created by the Affordable Care Act (ACA). However, changing market dynamics – rising premiums, changes in issuer participation and plan availability – raise significant concerns about the ability of the marketplaces to provide a stable source of health care for those Americans who rely on them.
To better understand the situation affecting the U.S. health insurance marketplace, a multi-site team of investigators undertook a study looking at the effect of instability on changes in the consumer choice set. They used this data to analyze potential incentives to switch plans among price-sensitive enrollees, with the goal of informing policy going forward. The resulting publication appears in Health Services Research. The authors are Dr. Caitlin N. McKillop, State University of New York at Cortland, department of economics; Dr. Teresa M. Waters, University of Kentucky College of Public Health, department of health management and policy; Dr. Cameron M. Kaplan, University of Tennessee, department of preventive medicine; Dr. Erin K. Kaplan, Rhodes College, department of economics; Dr. Michael P. Thompson, University of Michigan Medical School; and Dr. Ilana Graetz, University of Tennessee, department of preventive medicine.
Investigators obtained from the Centers for Medicaid & Medicare Services data on health plan features for non-tobacco users in 2,512 counties in 34 states participating in federally-facilitated exchanges from 2014 to 2016. They examined how changes in individual plan features – including premiums, deductibles, issuers, and plan types – impacted consumers who had purchased the lowest-cost silver or bronze plan in their county the previous year. They then calculated the cost of staying in the same plan versus switching to another plan the following year and analyzed how costs vary across geographic regions.
In most counties in 2015 and 2016, the lowest-cost silver plan from the previous year was still available – but was no longer the cheapest plan. In these counties, consumers who switched to the new lowest-cost plan would pay less in monthly premiums on average, by $51.48 and $55.01 respectively, compared to staying in the same plan. Despite potential premium savings from switching, however, the majority would still pay higher average premiums compared to the previous year, and most would face higher deductibles and an increased probability of having to change provider networks.
The authors conclude that while the ACA has shown promise in expanding health care access, continued changes in the availability and affordability of health plans are likely to result in churning and switching among enrollees, which may have negative ramifications for their health going forward. They recommend that future health care policy reform should aim to stabilize marketplace dynamics in order to encourage greater care continuity and limit churning.