ACA signups tracker Charles Gaba, extrapolating from recent New York state data, postulates that 85-plus percent of February signups for Qualified Health Plans (QHPs) on ACA exchanges are people who were previously uninsured.
If this inference is on target, it shouldn't be too surprising -- though it either contradicts or suggest a rapid reversal of trends asserted in prior reports from insurers and McKinsey & Co. We know that over 80% of QHP signups qualify for subsidies. That suggests almost by definition that a substantial percentage of signups would previously have found insurance on the individual market unaffordable. Moreover, we also know that less than 20% of those who complete the application process on the exchanges but do not qualify for subsidies actually sign up for a plan on the exchanges.
Showing posts with label off-exchange insurance. Show all posts
Showing posts with label off-exchange insurance. Show all posts
Tuesday, February 18, 2014
Saturday, February 15, 2014
Buying unsubsidized insurance in the ACA universe: A preview
A few days ago, I noted that less than 20% of those who had completed applications on ACA exchanges and been found ineligible for subsidies had actually enrolled in plans through the exchanges. I added an invitation to people who were shopping for insurance without a subsidy to share their experience with me.
I have since spoken to several people who have bought insurance off-exchange. I will report on their fascinating experiences in a few days: first, I want also to speak to brokers and perhaps others who can overview the off-exchange individual market (if you can help, please let me know). Here, I'd just like to overview a few patterns and general observations. Some are obvious but perhaps still not widely recognized. Here goes:
1) If you are subsidy-ineligible, there is no reason to complete the transaction through Healthcare.gov or a state ACA exchange. Why add an extra layer of bureaucracy and send you application through the shaky "834" tunnel? (An 834 transmission is a reporting tool that brokers, and now the exchanges, sue to send completed applications to insurers.) Also, why not get a sense of how responsive competing insurers are? [Update, 2/17: a reader provides a reason to buy on the exchange: "future income is never guaranteed and if I end up unemployed or with a lower than expected income in 2014, I can get the subsidies later when I file my taxes if I’m eligible. "]
2) Price aside, the individual market is much easier to navigate than it used to be -- first, because the ACA exchanges offer a quick lay of the land and price benchmark, and second, because medical history is no longer relevant. Two people told me that all you need is a credit card -- the insurers don't even ask for a driver's license. And if you come to a broker quoting an exchange plan in your price range and asking if they can beat it, you are shopping with the benefit of solid price discovery.
I have since spoken to several people who have bought insurance off-exchange. I will report on their fascinating experiences in a few days: first, I want also to speak to brokers and perhaps others who can overview the off-exchange individual market (if you can help, please let me know). Here, I'd just like to overview a few patterns and general observations. Some are obvious but perhaps still not widely recognized. Here goes:
1) If you are subsidy-ineligible, there is no reason to complete the transaction through Healthcare.gov or a state ACA exchange. Why add an extra layer of bureaucracy and send you application through the shaky "834" tunnel? (An 834 transmission is a reporting tool that brokers, and now the exchanges, sue to send completed applications to insurers.) Also, why not get a sense of how responsive competing insurers are? [Update, 2/17: a reader provides a reason to buy on the exchange: "future income is never guaranteed and if I end up unemployed or with a lower than expected income in 2014, I can get the subsidies later when I file my taxes if I’m eligible. "]
2) Price aside, the individual market is much easier to navigate than it used to be -- first, because the ACA exchanges offer a quick lay of the land and price benchmark, and second, because medical history is no longer relevant. Two people told me that all you need is a credit card -- the insurers don't even ask for a driver's license. And if you come to a broker quoting an exchange plan in your price range and asking if they can beat it, you are shopping with the benefit of solid price discovery.
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