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3 ways PPACA plans fool consumers

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Some health insurance agents and brokers hate the Patient Protection and Affordable Care Act (PPACA) exchange system too much to have anything to do with the second annual open enrollment period.

Some health producers love PPACA and the exchange system — or peace with exchange managers and insurance regulators — too much to talk about any concerns they have in public.

Gail Hiller-Lee is in the middle: When the New York state broker is wearing her broker hat, all she wants is for individual health and group health consumers to get the best deals possible, and for all the players involved to follow the rules in effect in her state as well as possible, or else work openly to change rules that turn out to be counterproductive or impractical.

Recently, she put out a cry for help through Health Agents for America (HAFA), a group that has been trying to get the exchange managers at the U.S. Department of Health and Human Services (HHS) and the state-based exchanges to warm up to agents and brokers.

To learn more about some of her observations about what’s going on at the exchange program in her area, in the New York City area, read on.

1. The rules for putting plans in metal levels say nothing about how good or how big the plan’s network is.

The drafters of PPACA and HHS regulations require sellers of all new major medical policies to classify them in terms of metal levels — bronze, silver, gold and platinum — based on the percentage of the actuarial value of the essential health benefits package that the plans cover.

The standards for which PPACA-compliant plans go into which metal level say nothing about how big or how good the provider network has to be. A bronze plan might offer a midsize provider network and some out-of-network coverage for routine care. A platinum care might offer access to the minimum number of doctors provided by network adequacy rules and no out-of-network benefits whatsoever.

“I buy a platinum plan because I understand it to be the richest plan available, but I’ve lost my local hospital [and] my out of area doctor,” Hiller-Lee said in an e-mail interview. “Certainly, this shouldn’t be considered platinum.”

The lack of out-of-network care benefits for anything other than emergency care can make covering college students and other mobile people especially difficult, Hiller-Lee said.

Brokers can help explain the difference between the different types of networks, but the current pressure to push brokers out of the system reduces the odds that consumers will hear an honest, open conversation about networks, Hiller-Lee said.


2. If a plan issuer and the providers get into a compensation fight in the middle of the year, and providers leave the network, the enrollees are stuck.

Hiller-Lee said the fact that issuers can change networks in the middle of the year, but that the enrollees are stuck in the plan until they qualify for a special enrollment period for some other reason, or until the next open enrollment period, makes the network adequacy issue especially troubling.

She said one plan in her area just lost access to Sloan Kettering, a major cancer hospital. PPACA rules might provide some protection for patients who are already getting care at the hospital, but not for patients who fear they might need topnotch cancer quality.

George on a dollar bill

3. Plans may be using broker compensation structures to discourage producers from selling plans with richer benefits.

Hiller-Lee said on insurer in her market recently said it would stop paying commissions on the sale of platinum plans and some bronze plans.

In theory, New York state plans are not supposed to be able to use differences in commissions to “steer” consumers from one type of plan to another, but Hiller-Lee said she sees no sign that the insurer will adjust its commission system or that New York state regulators will take action.

An insurance company “knows that no one will come to the aid of an insurance broker,” Hiller-Lee said. 

Representatives from Health Republic did not respond to a request for comment on Hiller-Lee’s comments.

See also: Why health plan enrollees want to scream.


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