Auto-enrollment thoughts

From Alain – I had to clone David’s original post because it’s borked for some reason. Please use this one instead as commenting in the other post was nonfunctional for most.

 

Over at Health Affairs, I have a piece that riffs on a series of posts that sketched out what an auto-enrollment process could be. I liked that series but I have some suggestions for making the proposal stronger and easier to implement.

The first is a very weedy examination of risk adjustment. They proposed using Catastrophic plans which currently risk adjust against themselves to take advantage of the low premiums. But those plans would not lower the rates of Bronze, Silver or Gold plans. There is a better solution to give catastrophic/hit by a meteor coverage at zero net premiums while improving the entire metal risk pool:

If we are to assume a low-premium plan that contributes to metal risk adjustment is a desired means of lowering premiums in the metal risk pool by lowering average morbidity, then the idea advanced in 2013 by Senator Mark Begich (D-AK) and others to allow so-called “copper” plans that have 50 percent actuarial value would be a better course of action. Copper plans would have higher deductibles and out-of-pocket maximums than current bronze and catastrophic plans. These plans would also have lower premiums due to the lower actuarial value being sold.

My other suggestion is more mechanical — move the open enrollment window:

Katherine Swartz and John A. Graves found in 2014 that the current policy benefit year that begins on January 1 and ends on December 31 coincides with periods of significant financial stress for households. The Henry J. Kaiser Family Foundation found in 2017 that almost half of the currently uninsured thought insurance was too expensive. It is plausible that the timing of the open enrollment period at the height of financial stress has led to more people electing to remain uninsured. The entire market could be improved if the policy year shifts to a May 1 to April 30 cycle instead of the current calendar year cycle. This would lead to purchasing decisions made with the most recent tax information as well as eliminating a source of adverse selection and sorting.

Some states are starting to talk about how they can get creative with the ACA in order to stabilize their markets. Auto-enrollment is a plausible mechanism so I hope that I am able to smooth off at least one or two rough edges of a pretty good initial plan.






17 replies
  1. 1
    Yarrow says:

    Thanks, Alain. Can you access the comments that were on the post?

    ReplyReply
  2. 2
    Alain the site fixer says:

    I will see what I can do. This literally shouldn’t happen, some wacky edge condition I guess.

    ReplyReply
  3. 3
    Alain the site fixer says:

    It’s a little ugly. As in, not easily. Let me dig in more. I have almost no time to do this today.

    ReplyReply
  4. 4
    Yarrow says:

    In the previous thread (two below, I think) someone said that the “On the Road” thread did the same thing for a minute and then came back. Is there some weird glitch?

    ReplyReply
  5. 5
    Alain the site fixer says:

    No can do on the comments.

    Let me go look at posts for today. For some reason, it’s a mis-match between the post title which is used for the URL when you click on things and the actual url derived from that page title (“…/page-title-2/” is the actual URL but WordPress wants to go to “…/page-title/”)

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  6. 6
    Yarrow says:

    @Alain the site fixer: Thanks for looking at it. FYWP really does like to mess things up.

    As for the article, my comment was on how difficult it is to have to pick insurance at the end of the year and how crowded doctor’s offices are during such a busy time as everyone tries to get that visit in before the new deductible kicks in Jan 1. From the article:

    The entire market could be improved if the policy year shifts to a May 1 to April 30 cycle instead of the current calendar year cycle.

    My question was, how would that work given that it has tax implications. Our tax year runs on the calendar year and offsetting the health insurance year would mess that up.

    ReplyReply
  7. 7
    Sam Dobermann says:

    There is a myth that Medicare administrative costs are so low but many true costs are hidden. That’s just the cost of claims handling payments. All the other costs like what is covered and how much to pay for each procedure & how much i
    o

    1

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  8. 8
    Amir Khalid says:

    @Alain the site fixer:
    Is it possible to delete the borked post?

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  9. 9
    Alain the site fixer says:

    @Amir Khalid: Upon second-glance, the deed is done. Thanks for the suggestion, hope you’re enjoying some food and good cheer.

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  10. 10
    Amir Khalid says:

    @Alain the site fixer:
    It is as I had feared. FYWP has achieved sentience and is now making war on humans.
    ETA: It appears Alain beat FYWP back this time.

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  11. 11
    Kelly says:

    I vote for moving ACA enrollment to tax season Feb 1 to April 15th. Every year the feds send you a prefilled income tax form and a packet of ACA costs and options for your area. Check a couple boxes and mail everything back.

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  12. 12
    WRRistow says:

    I’m coming late to this party, but it would seem to me that the natural combination of auto-enrolled and high-deductible catastrophic coverage would be a high-deductible catastrophic plan for EVERYBODY, functioning as reinsurance for those with other coverage. It should reduce the cost of all policies. Is there a reason this has been considered and rejected?

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  13. 13
    Litlebritdifrnt says:

    @Alain the site fixer:

    Alain I am trying to submit photos to you using the form and having problems. Could you let me know how to fix it please?

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  14. 14
    rikyrah says:

    Thanks Alain

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  15. 15

    @WRRistow: Oh, you mean the Kerry-Edwards 2004 proposal

    Biggest challenge is getting the 218-51-1 lined up as it could work for the Feds to effectively backstop catastrophic costs and let the insurance markets handle the medium and low cost claims.

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  16. 16
    Alain the site fixer says:

    @Litlebritdifrnt: it’s not you. It’s me. Seriously, I need to refresh certificates and I don’t have the time until Sunday.

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  17. 17
    Alain the site fixer says:

    @David Anderson: David, if you look in the posts, you’ll see that I put your published post as draft. There are some questions there you may want to answer/copy and paste into an answer.

    Somehow the published copy and your draft got confused and pointed to each other, so I cloned the copy I could see and that is this one.

    ReplyReply

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