Supporting The Individual Health Insurance Market

The status of the market for individual health insurance has attracted considerable scrutiny recently. Premiums are high and rising, and insurers are exiting the market. Some believe that this is evidence of a death spiral in the market, reflective of inherent problems with the Affordable Care Act (ACA). Yet, other recent reports suggest a turn toward insurer profitability and market stability. Where does the truth lie? The typical hallmarks of a death spiral are risk pool deterioration and declining enrollment, which drive rising premiums, which in turn drive greater beneficiary disenrollment. However, deterioration of the risk pools has been modest—on the order of 5 percent, on average, between 2014 and 2015—though this varied widely, with risk increasing by as much as 17 percent in some areas and declining by 8 percent or remaining stable in others. Enrollment has also been relatively stable, although, in 2017, the number of consumers selecting a plan during the open enrollment period decreased slightly, by 4 percent. The telltale signs of a death spiral seem to be absent. Yet, the market is far from healthy. Between 2016 and 2017, the Kaiser Family Foundation reports that many locations experienced huge premium increases. For example, the unsubsidized premium for the second-lowest silver plan increased 145 percent in Phoenix, AZ, 71 percent in Birmingham, AL, and 67 percent in Oklahoma City. Overall, for 2017, Assistant Secretary for Planning and Evaluation es...
Source: Health Affairs Blog - Category: Health Management Authors: Tags: Following the ACA Insurance and Coverage individual market medical loss ratio reinsurance risk corridor payments Source Type: blogs