What are individual health insurance plan choices looking like outside of the new public exchange system?
Brokers who were interviewed said efforts by the drafters of the Patient Protection and Affordable Care Act (PPACA) to expand access to individual health coverage seem to be hurting the non-exchange market.
Toby Stark, an independent insurance broker in New Jersey said he thinks there will be fewer options available on plans outside of the exchange in 2014.
David Oscar, an insurance broker at Altigro Resource Group, said consumers who are willing to buy exclusive provider organization (EPO) or health maintenance organization (HMO) coverage will still have an abundance of choices in 2014.
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Consumers looking for more flexible plans will find the market to be less kind, Oscar said.
“In a perfect world you would be able to choose the benefits you want included in your plan,” Stark said. “However, the insurance carriers and legislators are so intertwined. Carriers have to follow what the legislators pass, and what they are passing are benefits that are tied to hot-button issues. In other words, what people are most complaining about.”
A few years ago, consumers were complaining about the high cost of coverage, unexpected gaps in coverage, and the difficulties people with chronic health problems had with getting and keeping coverage.
PPACA might resolve some of those complaints – and make high-quality, reasonably priced medical insurance available even to people who qualify for disability benefits, or long-term care benefits — but at a cost, brokers said.
PPACA drafters set up the exchanges to help consumers and small-business owners shop for coverage, and to distribute new federal subsidies.
Except in the District of Columbia and Vermont, where insurers must sell all new 2014 individual coverage through the exchange programs, individuals can still buy coverage outside of the exchanges.
PPACA requires insurers to sell both exchange and non-exchange individual plans on a guaranteed-issue basis during the initial open enrollment period, which is set to last from now until March 31.
The only personal health factor insurers can use when selling either exchange or non-exchange individual coverage is age.
PPACA also requires insurers selling any individual medical plan, whether on or off the exchange, to provide a standardized “essential health benefits” (EHB) package that includes coverage for hospital care, physician services, and chronic disease management.
In the past, issuers of individual medical policies sometimes held costs down by limiting or excluding coverage for mental health care, or for the care related to a normal pregnancy and delivery. The PPACA EHB rules now require individual medical plans to offer mental health benefits and maternity benefits.
Other PPACA rules put new limits on deductibles but increase out-of-pocket annual maximums – the sum of deductibles, co-payments and coinsurance payments – to a total higher than what many insured consumers have been used to.