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2014 saw the biggest change to the health insurance industry since the advent of Medicare and Medicaid in 1965. What does the future hold?
Don HallFrom January to June of 2014, an estimated 12 million previously uninsured individuals received health coverage under the Affordable Care Act (ACA). This unprecedented growth in enrollment challenged every aspect of health plan operations from customer service to premium billing to care management to provider network services.
Providers also felt the impact, resulting in the development of new provider entities and models of care.
There are distinct differences between many of the newly insured and previously insured populations. Newly covered members include individuals who were previously uninsurable due to pre-existing conditions, as well as Medicaid-expansion adults-some of whom are homeless. New enrollees with chronic high-cost conditions and/or significant behavioral issues are pushing health plans into new frontiers in care management.
A number of new entities emerged from the ACA including state and federal exchanges and co-ops. Despite early missteps, the exchanges were able to enroll more than 8 million individuals, including those enrolled through newly created co-ops in the 26 states in which they operate.Due to the number of newly covered individuals, provider access was a big concern early in the year. While it’s uncertain whether the issue will remain in the future, care delivery models including telemedicine, nurse practitioners and physician extenders, and walk-in clinics that expand access beyond traditional means have grown substantially.
The legislation also spurred significant changes in health insurance offerings and renewed interest in care models. Guaranteed issue replaced individual underwriting, and essential health benefits were mandated. Dependents up to 26 years of age could be covered on a parent’s plan and strict medical loss ratio requirements were established.
Add to that an emphasis on accountable care organizations, patient-centered medical homes and a more intensive effort to comprehensively manage care with a
focus on lowering costs and improving outcomes, and it becomes clear that little on the healthcare landscape was left unchanged.
In fact, 2014 has seen the most significant changes in the healthcare industry since the advent of Medicaid and Medicare in 1965. The early predictions that the industry could not adapt to the ACA or that Americans would lack access to care, failed to take into account the resilience and innovation inherent in plans, providers, technology companies and a myriad of other service providers from care management pharmacy benefit managers.
We move toward the end of the year with new approaches to improve health outcomes, slightly better affordability and an enhanced ability to respond to new environments.
And the change we saw in 2014 is just the tip of the iceberg as many things put in place are still in their infancy.
NEXT: Looking Ahead
An unknown for 2015 is whether rates of uninsured will continue to fall. Will health insurance rates be competitive enough to attract more purchasers?
The individual penalty/tax for those opting out of insurance coverage increases from $95 to $325. Will that be enough to get more people to move from the uninsured ranks?
A number of states that opted out of Medicaid expansion for 2014 are looking at how they can participate going forward. Should this occur, it would have a significant impact on uninsured populations, health plans, and providers in those states.
Other trends include the impact of higher deductible plans on utilization, the continued growth in specialty drugs, the integration of electronic medical records and the appearance or growth of disruptive competitors in the healthcare market.
Of course, the law of unintended consequences will prevail and the biggest changes are likely to occur in the areas we least expect.
Don Hall, MPH, is principal of DeltaSigma LLC, a consulting practice specializing in strategic problem solving for managed care organizations. He also is an editorial advisor for MHE.