Insurance Market Reform

The new health insurance exchanges are the core of the ACA’s reforms, but how the law improves the nonsubsidized portion of the individual market is also important. This issue brief compares products sold on and off the exchanges to gain insight into how the ACA’s market reforms are functioning. Initial concerns that insurers might seek to enroll lower-risk customers outside the exchanges have not materialized. Instead, more generous benefit plans, which appeal to people with health problems, constitute a greater portion of plans sold off-exchange than those sold on-exchange.

The Center for Consumer Information and Insurance Oversight has released a list of proposed 2017 Essential Health Benefits (EHB) benchmark plans for all 50 states and the District of Columbia. The Affordable Care Act (ACA) requires non-grandfathered health plans in the individual and small group markets to cover EHBs, which includes items and services in ten benefit categories. For plan year 2017, the EHB benchmark plan is a plan that was sold in 2014. CCIIO is accepting public comments on the proposed benchmark plans until September 30, 2015.

Large bills from an out-of-network health care provider can be an unexpected surprise to consumers who did not knowingly obtain health care outside the plan’s provider network. As health plans embrace tighter networks as a tool for improving quality or reducing premiums, the potential for such bills may grow. Although insurers may protect their plan members in some cases, there is no broad protection from these types of bills in federal law or in most states. Several states have acted to protect consumers from the need to pay balance bills, at least in emergency situations. But even these states have struggled with how to implement protections while balancing legitimate interests of health plans and health care providers. This issue brief summarizes and compares seven state approaches to protecting consumers from balance billing.

State action to prevent discriminatory benefit designs has been prompted, in part, by vital input from consumer advocacy organizations. This resource, which resulted from invitations sent to health-related consumer groups that signed the 2014 "We are (Still) Essential" letter to U.S. Department of Health and Human Services Secretary Burwell, provides a compilation of organizations that are willing to assist state insurance regulators with identifying discriminatory benefit designs or for other regulatory tasks that require expertise related to a certain disease group or consumer concern.

Prior to the Affordable Care Act (ACA), most states' individual health insurance markets were dominated by one or two insurance carriers that had little incentive to compete by providing efficient services. Instead, they competed mainly by screening and selecting people based on their risk of incurring high medical costs. One of the ACA's goals is to encourage carriers to participate in the health insurance marketplaces and to shift the focus from competing based on risk selection to processes that increase consumer value, like improving efficiency of services and quality of care. This brief looks at how carriers are competing in the new marketplaces in six states, namely through cost-sharing and composition of provider networks.

Employees of small businesses have much lower rates of insurance coverage and less generous benefits than their peers at bigger companies, owing largely to challenges unique to the small group market. The ACA introduced significant reforms aimed squarely at these problems, but implementation has moved slowly and the ultimate impact of these changes is unclear. This essay takes a look at developments in the small group market since the passage of the ACA and highlights several issues that could threaten the long-term viability of this market as implementation moves forward.

This document contains final regulations regarding the summary of benefits and coverage (SBC) and the uniform glossary for group health plans and health insurance coverage in the group and individual markets under the Affordable Care Act (ACA). It finalizes changes to the regulations that implement the disclosure requirements to help plans and individuals better understand their health coverage, as well as to gain a better understanding of other coverage options for comparison.

Introduced by the Affordable Care Act (ACA), the Essential Health Benefits (EHBs) are a set of ten health care service categories that non-grandfathered health plans in the individual and small group markets must cover. States are in the process of making important decisions about the EHBs, therefore this is a key time to influence and shape the next phase of EHBs across states. This brief highlights steps that California has taken to update the EHBs, and continued advocacy efforts.

In March of 2012, the U.S. Department of Health and Human Services issued a regulation defining student health plans as individual health insurance under federal law. As a result, they are now subject to the same consumer protections afforded to all those covered by individual health insurance set forth in the Public Health Service Act, as amended by the Affordable Care Act (ACA). This issue brief examines student health plans, which cover over 1 million students, and investigates the interplay between federal and state regulation with regard to these plans.

The individual insurance market has changed substantially under the ACA. Starting in 2014, the health law put in place new rules for what types of plans can be sold, required insurance companies to guarantee access to everyone regardless of health status, and limited the factors insurers could use in setting premiums. As of the end of open enrollment in 2014, 8 million people had signed up for coverage through the Marketplaces. However, it has been unclear precisely how many of these Marketplace enrollees were previously uninsured or how many would have purchased individual coverage directly from an insurer in the absence of the ACA. This analysis of recently-submitted 2014 filings by insurers to state insurance departments shows that 15.5 million people had major medical coverage in the individual insurance market – both inside and outside of the Marketplaces – as of December 31, 2014. Enrollment was up 4.8 million over the end of 2013, a 46 percent increase.