One of the problems with predicting what will happen to the commercial major medical coverage market during the third open enrollment period, for 2016 coverage, is that health insurers still aren't completely sure how they did in 2014, let alone how they'll do in 2015.
The open enrollment period for individual coverage for the coming year is set to start Nov. 1 and run until Jan. 31.
That calendar affects all individual coverage sold inside or outside the Patient Protection and Affordable Care Act (PPACA) exchange system.
The PPACA Small Business Health Options Program (SHOP) exchange has a different kind of calendar system. Issuers in the non-exchange group market can set their own rules but may benefit from any buzz, or ail from any blahs, prevalent in the individual market.
See also: PPACA World 2016: Dates, risks, flops
Many exchanges have started to show what their 2016 plan menus will look like through a window shopping mode.
Commercial market issuers, marketers and exchange technology vendors are revving their engines.
"We're really excited about this open enrollment season," Mike Baker, general manager for commercial products at hCentive, an exchange technology company, said in a telephone interview.
Some companies have thought hard about the problems insurers and insurance exchanges may face and are counting on those problems to create opportunities.
Managers of Healthcare Inc., the owner of the HealthCare.com lead-generation website, is an example of a company hoping tight budgets give marketers an incentive to economize.
"We deliver consumers when they're shopping," Jeff Smedsrud, the chief executive officer (CEO) of Healthcare, said during a visit to New York.
But players in the market are still so uncertain about how the market really works that they continue to struggle to find ways to describe the market.
For a look at five of the wildcards, read on.
1. The three R's
PPACA calls for the U.S. Department of Health and Human Services (HHS) to buffer health insurers against risk using three major new "three R's" risk-management program: a temporary reinsurance program, paid for with a broad assessment on health insurers; a temporary risk corridors program, which is supposed to shift money to eligible carriers with poor operating results from carriers with good operating results; and a risk-adjustment program, which is supposed to shift money to carriers with relatively low-risk enrollees from carriers with high-risk enrollees.
HHS had trouble even getting the data it needed to calculate the transfers for 2014, and it already says the risk corridors program is likely to have less than 13 percent of the cash it needs to make good on obligations to the insurers that had good operating results in 2014.
The result is that insurers are still not really sure how much their major medical operations earned in 2014.
Health insurance price analysts have struggled to comb through rate filings to come up with 2016 rate forecasts, and to know which numbers to present in what format.
Should analysts look at how much rates for the same plan will change between 2015 and 2016? Should they look solely at silver plans or find some way to deal with bronze, gold and platinum plans? Is they are anything they can do to reflect changes in the enrollees' out-of-pocket spending maximums? Should they assume enrollees will change plans to get lower prices?
Baker sees prices rising 30 percent to 40 percent in 2016 in the markets he cares about.
The ultimate outcome of the three R's cash transfer calculations could have unexpected effects on coverage menus and prices, on and off the exchange, but market watchers are cautious about trying to discuss the subject.
"What that impact is going to be, I'm not sure yet," Baker said. "No one can sustain irrational pricing for very long."
But "we haven't heard of anyone saying they're yanking their plans of a given market" in recent months, Baker said.
Price upheaval could help companies like Healthcare, by giving more consumers' an incentive to actively shop for coverage.
Smedsrud is offering tools that help consumers shop for products based on factors other premiums, and to connect with exchanges or insurers interested in acquiring their business.
"They're more attuned to getting the best customers in the best plans," Smedsrud said.
In the future, "the number of people shopping is going to grow," Smedsrud said. "Consumer are eventually going to become better and better shoppers."
3. Effects of tight marketing budgets
HHS seems to be cutting its spending on exchange support, and it's not entirely clear how all of the surviving state-based exchanges are going to pay for advertising and other forms of outreach this year.
See also: 3 PPACA exchange runner nightmares
But the exchanges could scrape up the money from somewhere, and make more efficient use of the money they have, and insurers that are more confident in the likelihood that exchange systems will work properly may be more inclined to pay for campaigns of their own.
Baker said he sees signs carriers will be advertising more this open enrollment period, in part because of an increase in confidence in the capabilities of private exchange systems as well as of public exchange systems.
4. Uncertainty about the small-group size limit
Congress pleased most insurance trade groups and state insurance regulators by rushing to approve a bill, H.R. 1624, that is set to let states continue to decide whether to set the upper size limits for small groups at 50 employees or 100 employees, rather than shifting all states to a PPACA-mandate 100-employee cut-off.
At press time, President Obama was believed to be likely to sign the bill into law.
Although the bill may increase certainty in some states, it may increase uncertainty in other states, and that uncertainty may have a difficult-to-predict effect on the small-group market, Baker said.
Some states have already shut down their state-based exchanges, or at least temporarily shifted to using the HHS HealthCare.gov enrollment system.
Assurant Inc. (NYSE:AIZ) and four of the nonprofit, member-owned PPACA CO-OP plans have left the market since major PPACA commercial health insurance market changes took effect in January 2014.
Winnowing could start to affect private exchange programs and insurers' private exchange programs as well.
Baker noted that, in the private exchange market, some insurers are investing capital and skilled manager time in building major efforts to sell broad, deep menus of ancillary products through private exchanges.
Other insurers are dipping a toe in the private exchange market.
Some of the toe dippers may do better than they expect, Baker said the companies that seem most likely to stay in the private exchange ancillary market seem to be the ones that are clearly making a serious commitment to the market.
Image: TS/Rick Gomez