The hope of stabilization

One of the frequent calls of caution from health care wonks and insurance industry folks who are actually trying to inform people instead of lobby for favorable treatment is to wait. We knew that there was going to be a massive amount of catch-up care as people who either were uncovered, sporadically covered or had no usable insurance because the cost sharing was atrocious got coverage through either Medicaid expansion or the Exchanges. The big question was always how much catch up care was happening and if/.when would it subside as crisis care converted into maitenance care.

There is starting to be some evidence that the catch up care wave is subsiding:

The blue line is the Ohio Medicaid expansion population’s rate of inpatient stays per 1,000 enrolled months. This group started at 30 stays per 1,000 enrolled months. My guess is that these were deferred surgeries and treatments for chronic conditions that had been put off. Furthermore, the first people to always sign up for a guaranteed issue insurance product are the people who know that they need it because they are very sick. However, the catch-up care line dropped significantly and now the expansion population has an inpatient hospitalization rate similar to that of the fairly healthy but low income Legacy Medicaid population.

The same phenonmamn has occurred on Exchange. The first people to sign up in November 2013 were sick as hell. It is only in the most recent open enrollment period where the populations are starting to get healthier and the catch up care is subsiding as most of the self-identified high risk folks have been in the system for a year or more.

This uncertainty about catch-up care was why there were the three R’s of risk adjustment, risk corridors and re-insurance. No one knew how many expensive surprises were out there.






15 replies
  1. 1
    Baud says:

    Republicans will fix that.

  2. 2
    JPL says:

    @Baud: That’s right. If you could purchase across state lines, all those pesky regulations would go away.

  3. 3
    Baud says:

    @JPL:

    I really don’t know why they limit their proposals to state lines.

  4. 4
    JPL says:

    @Baud: That’s an interesting idea. A Somali prince could offer insurance policies, that allow you to see your own doctor.

  5. 5
    Baud says:

    @JPL: I can’t wait to receive his email offers.

  6. 6
    HinTN says:

    Please explain, Richard, why BC/BS of TN is claiming they need a 30% rate increase because ACA, and yet their profit soared last year.

  7. 7
    japa21 says:

    This catch-up care phenomena is also why I think that we will actually see a downward trend in Medicare costs. A lot of people who get into the Medicare program have either put off treatment or have not been even getting preventative care until now.

    By getting treatment in the years before entering Medicare the Medicare population should actually be getting healthier. At least that is what I would foresee happening. It will probably take several years to see an impact, but it is one of those things that wasn’t talked about very much.

  8. 8
    jayackroyd says:

    Or recent increases in deductibles and coinsurance are driving down utilization for out of pocket concerns.

  9. 9
    NobodySpecial says:

    Based solely on my experience as a not well off person, I wonder if there is a second wave coming as people who hit in the first wave (like me) prioritized their health problems and put some off for later due to cost. That’s what I did – I spent my first year racking up some bills to take care of the important priority that I would stop breathing a few dozen times a night when I sleep. Now that that’s done and I have the bill for that mostly paid down, I can start working on secondary conditions that are terrible but tolerable.

  10. 10
    Bubblegum Tate says:

    See, this is the kind of stuff that I probably wouldn’t have thought of on my own, but now that you’ve said it, I think, “Duh, of course! So obvious!” And that’s why I like your posts, Richard. Thanks!

  11. 11

    @jayackroyd: Jay — that is a chart for Medicaid, no cost-sharing, no deductibles… it was a chart of people getting good insurance and getting a lot of problems fixed very quickly

  12. 12
    jayackroyd says:

    @Richard Mayhew: Thanks! Comment withdrawn.

    (Reflects some personal sticker shock. Paid more out of pocket in 2015 than I ever have and look to exceed that in 2016. All routine.)

  13. 13

    @jayackroyd: No problem, and I understand, my wife just burned through our deductible last week (nothing serious but better to take care of it now than in 10 years), so I know what you’re feeling

  14. 14
    No One You Know says:

    The problem for insurers is that the federal government didn’t reimburse insurers on the fee schedule agreed to. For example, Moda was paid something like 11% of what it’s contract promised. That haircut was so severe that Moda is under state regulatory supervision because it’s finances are so
    bad.

  15. 15

    @No One You Know: Slightly different thing — you’re thinking of Risk Corridors which is one of things kicking Moda’s ass as what was a solid asset (a federal obligation) became a junk asset which destroyed Moda’s reserve position ( as well as the reserves of most of the Co-ops)

    Even in a world where risk corridors were paying out at 100%, there would have been catch-up care as people who had either not been insured, sporadically insured or massively underinsured qualified for veryhigh actuarial value Medicaid with almost no cost sharing, so they got a bunch of problems taken care of as soon as they could get an appointment.

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