Licking Wounds, Insurers Accelerate Moves To Limit Health-Law Enrollment

[eridani]

http://khn.org/news/licking-wounds-insurers-accelerate-moves-to-limit-health-law-enrollment/

Stung by losses under the federal health law, major insurers are seeking to sharply limit how policies are sold to individuals in ways that consumer advocates say seem to discriminate against the sickest and could hold down future enrollment.

In recent days Anthem, Aetna and Cigna, all among the top five health insurers, told brokers they will stop paying them sales commissions to sign up most customers who qualify for new coverage outside the normal enrollment period, according to the companies and broker documents.

Last year, these “special enrollment” clients were much more expensive than expected because lax enforcement allowed many who didn’t qualify to sign up, insurers said. Nearly a million special-enrollment customers selected plans in the first half of 2015, half of them after losing previous coverage.

In addition, Cigna and Humana, another big health insurer, have ceased paying brokers to sell many higher-benefit “gold” marketplace plans for individuals and families while continuing to pay commissions on more-profitable, lower-benefit “bronze” plans, according to documents and interviews.

Comment by Don McCanne of PNHP: No matter what legislation, regulations, rules or advisories our government produces, the private insurance industry will always find ways to skirt the intent of this oversight in order to maximize their business goals, usually at a cost to patients and public and private payers. The current efforts of insurers to manipulate the brokers are a prime example of how they will continue to work the system to advance their own interests.

As the Affordable Care Act was being crafted and then implemented, there was a push to include brokers as intermediaries who would provide customer access to the exchange plans. The argument was that brokers were highly qualified to provide guidance on what the best plans would be for their clients. But little was said about how insurers might find ways to use the brokers to to their own advantage.

As this article shows, insurers can heavily influence broker behavior through the commissions they grant. The insurers found that people who were signed up during special enrollment periods had greater health care needs and also were more likely to drop out after their needs were met. That’s easy. The insurers stopped paying commissions for most of the plans sold during these special enrollment periods. Also, people enrolling in gold plans, with their higher actuarial values (covered more of the costs), were also using more health care. Again, no problem. Many insurers quit paying commissions for gold plans but continued to pay them for lower actuarial value plans that required patients to pick up more of the costs of health care. Will the broker sell plans without a commission, when an insurer offers a commission for selling their more profitable plans?

Discrimination in the offering of private insurance plans is prohibited, but AHIP - the insurance lobby - says that insurers are not discriminating but rather are merely adjusting to market realities. Clare Krusing - AHIP’s spokesperson - said that there was no way “to offer the kind of coverage as they had in the past (gold or platinum plans) without sustaining huge losses.” It really is about profits, not patients.

And now many politicians and progressive pundits are telling us to build on Obamacare. Forget about single payer because it will “never, ever come to pass.” Instead let’s control costs through higher deductibles and other cost sharing, narrower networks, greater administrative hassles through ACOs and EHRs that keep professionals from tending to their patients, more opaque obstructions that keep sicker patients out of the private plans, more managed care that reduces access, especially to specialized services, *** **** ****, ***** ** ****, and ** ****** *****.

And those asterisks? They are the hidden future policies of the insurers that will further enhance their business models - policies that we can’t even conceive of since they can only be conjured up by the nefarious minds that are currently in control of our health care financing system. Do we really have to have a health care future that will eventually reveal to us what is behind the magic asterisks? Or shall we tell them on their way out the door where to put their asterisks, as we take over and set up our own single payer national health program?

[Wilms]

1. ^

[haele]

2. Here's another insurance co. money maker that just started happening with my policy

Instead of paying some of the medical service provider directly, Anthem/Blue Cross of California has starting sending checks to some of their patients to pay their portion of the bill they negotiated. As a "convenience" to help consumers manage their health care better.

I have received three checks (that I know of...) since 1 January for medical service in December. I know of at least seven doctor's visits and lab work appointments that were completed in December in my household, perhaps more; what if I missed one, a check was mixed in with a neighbor's mail by mistake (and tossed as junk mail), or my husband thought it was yet another survey and tossed a $100 - $500 check that was supposed to pay the insurance portion for the doctor's visit in the spam mail pile .
These checks are coming to my house 30 - 40 days after the service was provided, and at least 20 days after the billing was negotiated. Think about all that interest that is collecting on that money; in a large account with a better interest rate than the average bank account, they can easily recover almost a quarter of that check back as it sits and waits another 60 - 90 days for me to get it to the medical service billing. Unfortunately, like a good two-thirds (or more) of Americans, I'm living a "median class" lifestyle which is not what's commonly considered "middle class" (a lifestyle that typically requires an annual income of $120K - $150K...). The upper third of Americans with a better balance in their bank accounts (or better credit) than my household have no problems with simply considering the insurance check as a refund.

For me, that $100 check from the insurance company to pay their part of the bill runs the risk of getting hijacked for some necessity (like veterinary dental work, an inconvenient utility bill, or new car-seat for the grandbaby due at the end of the month) that would otherwise be patched vice replaced, bought thrift store vice new, or otherwise sacrificed/saved for. It's very difficult not to justify "well, I can use half of this for that something I need now and make arrangements with the hospital to pay over time...". The only way to avoid that temptation is to just sign it over to the billing department as soon as one receives it, and never let it see one's bank account at all. Because I'm sure as hell not going to put it in my bank account; I do not make (hell, never had made) enough to "run a $20K balance every cycle in my money market account" and set up an automatic bill paying with the various medical services used by my household as executives and six-figure "middle class" professionals are able to do.

From what I learned in the accounting/financial strategies portion of my courses for my business degree, that's really what the insurance company wants you to do, because that transfer of the check adds another 14 to 30 days before that money actually leaves the payables account on their books (and stops collecting interest). That means there can now be an additional 90 - 120 days after they've allocated the funds before the funds are released.

Haele

[eridani]

3. An excellent illustration of why private insurers should be limited to--

--taking care of paperwork, period.