The New Insurance Market (from the AHLA Annual Meeting)

Here's a peek at what panelists had to say about the future of the impending health insurance exchanges and what the marketplace may look like in a post-2014 world.

The goal of the ACA was to address 3 different markets - individual, small business and large group coverage.  If everything works the way it should, the implications are all very positive: Insurers will have more customers, providers will have a greater likelihood of getting paid for their services due to a greater number of insured patients, and patients (depending on your view of this) will be much closer to universal health care.

Two big take-away points from this morning's session:

• (1) If an individual is eligible for premium assistance (lower premiums based on annual household income), there is a 3-month grace period that those individuals have to pay their health insurance premiums.

     -- Incomes between 100-400% of the federal poverty line: $11,490-$45,960 for a single individual or $23,550-$94,200 for a family of four.

  1. –  Days 1‐30 – claims are paid normally. No retroactive termination for claims paid in this “month”.

  2. –  Days 31‐90 – claims must generally be pended until premium payment or end of grace period.

     -- This can lead to great uncertainty for providers during the second and third months of the grace period as to whether they will be reimbursed for services after seeing a patient who has yet to pay their share of the premiums.  This may result in many providers requesting that patients pay their premiums in full before a provider sees that patient.

     -- The federal government, coincidentally, allows for a three month grace period for lapse in coverage before an individual must pay a penalty. This may result in annual "gambling" during the last three months of a 12-month insurance plan for healthy, subsidy-eligible individuals to avoid paying for an entire year of coverage.

  
  
  

• (2) Large employers (with 50+ full-time employees) will have to decide whether they want to "pay" (a penalty) or "play" (by providing adequate insurance to employees).

     -- An employer will face $2,000 per employee if they do not provide coverage (or $3,000 for not providing enough coverage to an employee who then seeks coverage on the state exchange). This applies only to employers with over 50 full-time employees.