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ACA exchange flop may expand short-term health market

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The 2017 Affordable Care Act open enrollment period could create a boom in short-term health insurance sales early next year.

Analysts in the New York City office of GfK S.E., a German market research firm, have put survey data supporting that possibility in a new summary of results from an online survey conducted in August.

The survey attracted responses from 921 U.S. consumers ages 18 and older who had major medical coverage. Forty-eight, or 5.2 percent, used an ACA public health insurance exchange to get covered.

Thirty-two percent of the 2016 exchange users who participated said they were unlikely to be able to find ACA exchange health coverage options that would meet their needs for 2017. 

Related: NAIC opposes federal short-term health limit

The U.S. Department of Health and Human Services reported in March that as many as 12.7 million people were on track to have 2016 exchange coverage through the federal system or a state-based, state-run ACA exchange at the end of the individual exchange open enrollment period for 2016. 

HHS said at the time that the latest available figures on paid-up, “effectuated enrollment” showed that about 8.8 million people had health coverage at the end of 2015.

The 2016 exchange users who told GfK they expect to be stranded next year could end up finding exchange plans or off-exchange major medical plans they like. People who now have off-exchange coverage, or no coverage, could replace the current exchange users.

If the exchange users who told GfK they would be stranded really are stranded, that suggests that roughly 2.8 million to 4.1 million people who are now paying for exchange plan coverage could start 2017 with no major medical coverage.

The Centers for Medicare & Medicaid Services (CMS) has proposed limiting the coverage duration of short-term health insurance products to three months, to keep consumers from using short-term health insurance as an alternative to ACA exchange coverage or off-exchange major medical coverage.

At this point, CMS has not imposed the three-month limit. Officials at the Kansas City, Missouri-based National Association of Insurance Commissioners has opposed the proposal. It’s still possible that, in many states, agents will start the year with the ability to sell short-term health coverage that will last for most or all of 2017.


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