Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Life Health > Health Insurance > Health Insurance

On the Third Hand:

Your article was successfully shared with the contacts you provided.

The Office of Inspector General at the U.S. Department of Health and Human Services (HHS) recently pointed out that some of the health plan information in the government’s website is wrong.

Drafters of the Patient Protection and Affordable Care Act (PPACA) included the program to try to add a little market transparency right away, by at least giving consumers access to a somewhat standardized, comprehensive database full of individual and small-group health plan price information even before the PPACA exchanges (health insurance supermarkets) were supposed to creak to life in Oct. 1.

The HHS OIG folks have concluded in a report that, when they looked hard at the information in the November 2011 and January 2012 plan finder tool updates, some insurers had gaps in their data.

Other carriers listed products and plans that were not necessarily for sale or not necessarily recognized by the carriers’ sales representatives.

When the products and plans tested were available through the sales reps, and the reps gave conflicting information about the plans 19 percent of the time.

The Centers for Medicare & Medicaid Services (CMS) needs to develop better procedures to get private insurers to submit the required data, officials said.

What’s really striking about this is that creating the site is probably one of the simplest, cheapest, least controversial parts of PPACA, and doing that was still a complicated pain in the neck.

It’s seems a little hard to find people who understand enough about how the Pre-existing Condition Insurance Plan (PCIP) to provide even inaccurate or obviously biased accounts of what went wrong, let alone the gory details. But one idea floating around is that maybe PCIP administrators had trouble running the program partly because each state got to use its own insurance laws and regulations, and it was hard for HHS to deal with all of the complicated differences.

As a reporter, I’ve been trying to figure out how what the various states are doing about their exchanges. It’s a little hard even to find the websites of all of the various exchange managing agencies, and the agencies officially in charge of hating PPACA in the PPACA-hating states.

When I do find the exchange agency website, it looks as if each agency ends up doing roughly the same market research study, roughly the same requests for proposals, etc. Everything is just different enough to require each state to hire its own consultants and drive up costs.

The general burning complaints about PPACA here are that it will drive hurt producers and drive up coverage costs by forcing insurers to insure sick people.

Of course, PPACA might hurt intermediaries, but lots of things hurt intermediaries. Han Solo was an intermediary.

No one gets too weepy about regulations that affect Han Solo. Everyone expects Han Solo to take care of himself, because that’s what Han Solo does.

PPACA also might increase rates by forcing insurers to cover more old people and sick people, but I think it’s hard to know how all of the penalties, employer coverage mandates, subsidies and underwriting changes will really interact until they really take effect, assuming they manage to take effect. Because, really: Who knows which parts will even take effect when?

My guess is that what will be driving folks up a tree, if and when all of this really take effect, is all of the intrastate and interstate differences that make all of this a nightmare to manage. 

On the one hand, each state has its own personality, and state regulators are close to the people.

On the other hand, most of us like Netflix and pretty well. Who but someone who works at their headquarters really knows where they’re based, or notices whether they do something in California that they don’t do in Maine? Could it be that a lot of people would be fine with a so-so, culturally insensitive, English-language-only health exchange based in Finland if the coverage was pretty cheap and the site was easy to use?

On the third hand, all of the various consultants, state regulators, folks in charge of localizing health insurance plans and the like want to keep their jobs as much as the producers want to keep theirs. It seems likely all of the complexity (the driving force creating the pockets of inefficiency and wackiness that keep producers busy) will continue long after Jan. 1, 2014.

See also:


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.