Some Affordable Care Act change proposals that sound good on paper might jack up claims, chase customers away, or cause other unexpected problems.
In short, health insurance policy is complicated.
Members of the Individual and Small Group Markets Committee, an arm of the Washington-based American Academy of Actuaries, make that point in a look at many popular ideas for improving the ACA system.
The actuaries at the academy are people who have taken exams showing they understand statistics and risk analysis.
The academy is a professional association that tries to give policymakers and the public objective advice regarding risk and financial security issues.
The academy’s Individual and Small Group Markets Committee prepared the new ACA report to help readers, including insurance agents and brokers, understand what possible alternatives to the current ACA rules might do to the commercial health insurance market.
Here’s a look at some of what the committee said about five commonly discussed ACA change ideas.
Higher subsidies could help a lot, but there’s one little catch… (Image: Thinkstock)
1. Spend more government money on subsidies.
Increasing subsidy amounts might be expensive for the government, but it could greatly improve the quality of the commercial health insurance risk pool by cutting healthy people’s out-of-pocket premium costs and making the idea of buying health coverage more attractive, the actuaries say.
“The impact of any changes in subsidies on enrollment, premiums, and government spending would depend on the details,” the actuaries say.
One problem with the current subsidy program is that net coverage costs are higher for healthy older adults as well as older adults with known health problems, the actuaries say.
“Enrolling low-cost individuals of all ages should be the goal,” the actuaries say.
Actuaries say simply ending the open enrollment period Dec. 31 might do some good. (Image: iStock)
2. Shorten the open enrollment period.
The individual major medical open enrollment period, or time when people can now buy health coverage without showing they have what the government thinks of as a good excuse to buy health coverage, now runs from Nov. 1 through Jan. 31.
Insurers, regulators and ACA public exchange managers developed the open enrollment period system to discourage healthy consumers from waiting until they know they will be sick to pay for coverage.
Simply ending open enrollment on Dec. 31 would help health insurers by giving them a better idea of who their enrollees will be in the coming calendar year, the actuaries say.
Shortening the open enrollment period would also further reduce opportunities for consumers to wait until they get sick to pay for coverage, the actuaries say.
Some ACA watchers want to let everyone buy a plan that’s cheaper than the bare-bones bronze plan. (Image: Thinkstock)
3. Add barer-bones ‘copper’ level plans.
Current ACA rules let insurers sell major medical plans in four levels of benefits richness, ranging from bronze to platinum.