Going the Extra Step to Enhance the Exchanges

The insurance market reforms instituted by the Affordable Care Act (ACA), coverage expansions, and subsidies for purchases of exchange plans have been significant advancements for the patient community. However, the successful implementation of these steps relies on states to continue and expand their role as regulators of their health insurance market. State support is critical to guaranteeing the ACA’s goals of high-quality and affordable healthcare for all.

California created its own state health insurance exchange, and the Illinois exchange is a federal-state partnership. They utilize different models to improve access to coverage and are both rated as being “high-performing” states when it comes to ensuring that cost sharing and other plan designs do not discriminate or impede access to care. Maryland also created its own exchange, while Georgia relies on the federal government to run its health insurance marketplace; nevertheless, both received an “average-performing” score when judged on whether they make it easy for patients to understand and compare exchange insurance plans.

Which States Can Policy Makers Look to as Leaders in Creating Patient-Focused Health Insurance Markets?

While federal rules set minimum requirements for consumer protections, some states have taken extra steps to make their markets more patient focused. Much of what patients experience in the insurance market is driven by how the states are implementing the ACA and regulating the market. In the end, health insurance remains inherently local.

For the 2014 enrollment period, federal requirements for patient protections and oversight activities were rather limited; however, some states moved beyond federal requirements to include better, more comprehensive patient protections than the federally established minimums.

The National Health Council engaged Avalere Health, a leading national advisory company focused on healthcare business strategy and public policy, to analyze and aggregate data about the exchanges in all 50 states and the District of Columbia. Individual state reports summarizing the findings are being posted on the Web as they are completed.¹

All states—whether using a federally facilitated exchange, a federal-state partnership exchange, or a state-based exchange—have taken steps to enhance the patient experience, though to widely varying degrees.

Methodology

The states were evaluated on the following 5 principles, each broken into 15 metrics identified as important to the patient community:

Non-discrimination. To ensure cost sharing and other plan designs do not discriminate or impede access to care. Broken down into: 1) state action to limit discrimination, 2) number of plans or carriers across metal levels including platinum options, 3) network adequacy requirements, and 4) premiums across plans.

Transparency. To promote better consumer access to information about covered services and costs in exchange plans. Broken down into: 5) website search tools and functionality, and 6) plan information transparency.

State oversight. To ensure all health insurance exchange plans meet applicable requirements. Broken down into: 7) active versus passive purchasing (negotiating with plans to participate in an exchange), 8) contracting requirements for exchange participation, 9) rate review authority, and 10) number of carriers in the exchange.

Uniformity. To create standards to make it easier for patients to understand and compare exchange plans. Broken down into: 11) use of standardized benefit structures, 12) quality rating system, and 13) standardized display of plan information.

Continuity of care. To broaden sources of coverage and protect patients transitioning between plans. Broken down into: 14) continuity-of-care requirements, and 15) Medicaid expansion decision.

Based on the metrics for each of the 5 principles, a state could receive 1 of 3 scores (

Figure

). A state achieves a “beneficial” score when its policies or insurance market dynamics result in better access or choice for patients. A state achieves a “neutral” score when it fails to have policies that result in better access or choice for patients. Lastly, a state achieves a “negative” score when its policies or insurance dynamics result in reduced access or choice for patients.

Additionally, the state’s aggregate performance on all metrics within each principle was compared with other states’ performance on these same metrics. This comparative assessment yielded groupings of high-performing states, average-performing states, and low-performing states for each principle.

A state’s performance as of January 1, 2015, informed the status for each metric. Only the policies that are in effect for the 2015 exchange market were included in these reports. States with federally facilitated exchanges (FFE) that have not enacted laws to enhance their insurance marketplace were assessed based on the federal exchange. Some FFE states received positive scores for adopting policies that go beyond the federal standards.²

Findings

All states, regardless of the type of exchange program they have, received a “beneficial for patients” score on at least 1 metric (see Figure).

Among the FFE states analyzed, none received beneficial scores for more than 6 of the 15 metrics (40%). Alabama, Missouri, Oklahoma, and Wyoming each received only 1 beneficial score for relying on the Healthcare.gov quality rating system to show ratings for the 2017 plan year. Arizona, Florida, Louisiana, Michigan, and Pennsylvania each received beneficial scores on 6 metrics.

Among the states with state-based exchanges, California received the highest number of beneficial scores (on 14 of 15 metrics, or 93%), followed by New York (12 of 15 metrics, or 80%). However, having a state-based exchange did not automatically mean that the state was more likely to be viewed as patient friendly. Idaho, Hawaii, Kentucky, and Minnesota have state-based exchanges and received only 3 or 4 beneficial scores based on the 15 metrics.

Looking at the 5 overall principles, a majority of states addressed issues of oversight criteria, uniformity standard, nondiscrimination, and continuity of care. Only 10 states addressed transparency of insurance plan services and costs, an issue that a majority of patients want addressed in order to help them to make a more informed choice when selecting a health plan.³

Enhancing the Exchanges

This series of reports is just a single element of the patient advocacy community’s initiative to ensure protections for people with chronic conditions are appropriately included in state and federal actions related to the insurance market, and particularly the health insurance exchanges.

We evaluated the states on the “patient friendliness” of their insurance markets in order to assist the health sector and policy makers with identifying and promoting policies that better protect patients and with discouraging regulations that are less patient focused.

In response to efforts by the patient advocacy community, HHS has already addressed several of the principles covered in the state-by-state analysis in their 2016 exchange parameters, such as requiring insurers to make their plan information more transparent by publishing their drug formularies on a publicly available website and encouraging continued access to medications and providers for patients who are stabilized on specific treatments when switching plans.^4,5

We are encouraged by the administration’s actions to date, and now armed with a clearer picture of where individual insurance exchanges are better meeting the needs of people with chronic conditions, we will continue to coalesce the broader health community with a goal of advancing polices that will help other states to enhance their insurance exchanges.