Do the Health Insurance Exchanges Benefit Consumers? – DEBATED
General Reference (not clearly pro or con)
The Patient Protection and Affordable Care Act, Section 1311, “Part II—Consumer Choices and Insurance Competition through Health Insurance Exchanges,” page 55, signed into law on Mar. 23, 2010, available at the Library of Congress website, states:
“(3) USE OF FUNDS.—A State shall use amounts awarded under this subsection for activities (including planning activities) related to establishing an American Health Benefit Exchange, as described in subsection (b).”
Robert Pear, Washington correspondent for the New York Times, stated in his June 2, 2015 article titled “13% Left Health Care Rolls, U.S. Finds,” available at nytimes.com:
“About 13 percent of people who signed up for health insurance coverage [through exchanges] in 2015 under the Affordable Care Act have fallen off the rolls, many because they failed to pay their share of premiums, the Obama administration said Tuesday.
The administration announced in March that 11.7 million people had signed up for coverage through federal and state marketplaces. On Tuesday, federal officials disclosed that enrollment stood at 10.2 million as of March 31.”
Wendell Potter, former Vice President of Corporate Communications for CIGNA Corp., stated in his May 25, 2015 article for the Center for Public Integrity titled “Obamacare Exchanges Help, but Confused Consumers Are Still Spending Too Much,” available at the Center for Public Integrity website:
“One of the goals of the Affordable Care Act was to make it easier for people to comparison shop for coverage. Prior to the availability of the exchanges created by the law, that was next to impossible for people who didn’t have access to employer-sponsored coverage. There was no single place to go to shop, and there were no requirements that health plans provide information in understandable language and in a format that enabled customers to make apples-to-apples comparisons…
It’s little wonder, then, that the vast majority of people who have enrolled in health plans through the exchanges feel good about their selections, especially when you consider the way the health insurance world used to be. The marketplace is considerably more consumer-friendly today.
That said, buying coverage post-Obamacare is no walk in the park. It’s useful to think of the American health insurance marketplace, even with the consumer protections in the law, as a big casino—but without the ambience and excitement. And it’s also useful to think of many American health insurance shoppers as first- timers in Las Vegas. They might get lucky, but the odds are with the house.
When we buy health insurance, we are forced to gamble, to make bets with the house (the insurance company) that will affect our ability to pay for care if and when we need it. When we are at the point of enrolling in a plan, we have to place a bet on whether we’ll be able to go another year without coming down with some dread disease or getting hit by a semi. Should we pick a plan with lower premiums and higher deductibles or one with higher premiums and lower deductibles? Do we really want to take the time to see if the hospitals we would want to go to are ‘in network’ or to see if the drugs we might need to take are in tier one, two, three or four? How much fun is that?”
Robert Pearl, MD, Executive Director and CEO of The Permanente Medical Group, stated in his Apr. 30, 2015 article for Forbes titled “5 Reasons the Affordable Care Act Will Be Good for Americans”:
“In October, 2013, at the launch of the Affordable Care Act, I predicted that the health insurance exchanges about to go into effect would grow in popularity and improve the health insurance marketplace, then so imperfect.
Twenty months later, the exchanges are proving effective in reducing the number of uninsured and are beginning to provide the information people need to make an informed selection about which plan is best for their needs. As a result, I’m even more convinced than I was that they will bring about major improvements – improvements not only in how health coverage is purchased, but also in lowering cost and increasing quality outcomes.”
The US Centers for Medicare & Medicaid Services stated in an article titled “Health Insurance Marketplace Basics,” available at the Affordable Care Act website (accessed June 11, 2015):
“[T]he Health Insurance Marketplace, sometimes known as the health insurance ‘exchange’… helps people without health coverage find and enroll in a plan.
If you don’t have coverage through a job, Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), or another source, the Marketplace helps you find and enroll in a plan that fits your budget and meets your needs.”
The Henry J. Kaiser Family Foundation, in a May 21, 2015 report written by the Foundation’s Director of Public Opinion and Survey Research Liz Hamel, et al., titled “Survey of Non-Group Health Insurance Enrollees, Wave 2,” available at kff.org, stated:
“A large majority of those in ACA-compliant plans, including three quarters (74 percent) of those with Marketplace [aka exchange] coverage, rate their overall health insurance coverage as excellent or good. More than half also say their plan is an excellent or good value for what they pay for it, while about four in ten say the value is only fair or poor. Among those with Marketplace coverage, plan ratings are similar to 2014, though the share saying their plan is an ‘excellent’ value decreased somewhat from 23 percent to 15 percent…
Similar to findings from the 2014 survey, most people with ACA-compliant plans say they are satisfied with various elements of their plans, including their choice of providers, copays, premiums, and deductibles. Among those with Marketplace coverage, at least seven in ten say they are ‘very’ or ‘somewhat’ satisfied with their plan’s choice of primary care providers (75 percent) and hospitals (75 percent), as well as their copays for doctor’s visits (73 percent) and prescriptions (70 percent). About two-thirds (64 percent) say they are satisfied with their choice of specialists, while 16 percent are dissatisfied and about one in five (19 percent) say they don’t know, likely because they have not tried to use a specialist under their plan. While majorities of Marketplace enrollees say they are satisfied with their premiums and deductibles, substantial shares express dissatisfaction, including 32 percent who say they are dissatisfied with their premium and 36 percent who are dissatisfied with their deductible.”
The US Department of Health and Human Services (HHS), stated on its Aug. 23, 2012 posting “Creating a New Competitive Marketplace: Affordable Insurance Exchanges,” last updated on the Affordable Care Act website:
“Affordable Insurance Exchanges will provide individuals and small businesses with a ‘one-stop shop’ to find and compare affordable, quality private health insurance options.
Exchanges will bring new transparency to the market so that Americans will be able to compare plans based on price and quality. By increasing competition between insurance companies and allowing individuals and small businesses to band together to purchase insurance, Exchanges will help lower costs.”
The Los Angeles Times stated in its Feb. 8, 2012 editorial titled “‘Obamacare’ Insurance Exchanges: Let’s Get Going”:
“[E]ach state should set up an exchange regardless of how its lawmakers feel about ‘Obamacare,’ because it would help ameliorate the very real problems consumers face in the health insurance market…
The main value for consumers is in the convenience and transparency the exchanges provide. No longer would they have to wander from agent to agent (or website to website) to find out what their options were. Nor would they have to try to translate each insurer’s fine print to measure the total value of its policies. Enabling consumers to compare services and prices should remove some of the artificial barriers to competition in insurance and make it harder for companies to raise premiums.”
The Robert Wood Johnson Foundation stated in its July 2012 issue brief titled “4 Ways State Health Insurance Exchanges Can Improve Quality,” available at rwjf.org:
“1. Exchanges emphasize transparency in information about quality of care. Under the Affordable Care Act, states must ensure that plans participating in the exchange meet certain quality improvement criteria. The exchanges must also provide consistent quality and cost ratings for all participating plans—enabling customers to shop more easily based on quality, price, coverage, etc.
2. Exchanges can help link quality improvement with reimbursement strategies. Exchanges can coalesce insurance purchasers throughout the state—including Medicaid, the Children’s Health Insurance Program, state employee benefits programs, and private employers and their purchasing alliances—so that health plans hear consistent demands for quality that they, in turn, press upon their provider networks, sparking a tighter focus on quality care.
3. Exchanges can help consumers make more informed decisions. Exchanges’ Web portals can provide consumers with relevant and actionable information, not just on the availability of affordable plans—but also on quality of care. Displaying easy-to-understand information on the quality of care provided by plans (based on the performance of their provider networks) enables consumers to make informed decisions and promotes quality-driven plans.
4. Exchanges can help fuel competitiveness, which in turn can make care more consumer-centered. By offering a choice of plans and equipping consumers with information to better understand and compare options, the exchanges can push plans to compete with each other to provide quality- and value-driven plans that work for consumers.”
Families USA stated in its June 2011 article “Why We Need a Health Insurance Exchange,” available at its website:
“Consumers will greatly benefit once an exchange is in place. Here’s why:
Competition: An exchange will make the state’s insurance market more competitive. The exchange will force insurers to compete for customers based on value, instead of luring them with the trickiest fine print. The exchange will have an easy-to-use website that allows consumers to make apples-to-apples comparisons when they shop for health plans. On this level playing field, quality insurers of all sizes—not just the largest and most powerful—will be able to compete.
Transparency: Insurers in the exchange will have to use easy-to-understand language to describe their products—a vast improvement over the confusing jargon that consumers face now. And insurers will be required to share information about plan costs and quality in a standardized way so that consumers can truly understand what they’re getting.
Affordability: In the exchange, middle-class consumers (those who earn up to nearly $90,000 for a family of four in 2011) will be eligible for tax credits to help them pay their insurance premiums.
Many people will also receive help with copayments, deductibles, or other cost-sharing. And the exchange will monitor insurers to make sure that they aren’t unreasonably increasing their premium rates from year to year.”
Alyene Senger, a researcher in the Center for Health Policy Studies at the Heritage Foundation, stated in her Mar. 30, 2015 article titled “Are We Better Off Now, Five Years into Obamacare?,” available at heritage.org:
“For those who purchase coverage through Healthcare.gov and the state exchanges, their premiums increased dramatically when the law was first implemented in 2014 compared to what comparable coverage cost in the individual market prior to the law’s implementation. Furthermore, as a new Heritage Foundation analysis shows, premiums in the exchanges are continuing to rise in 2015, albeit at a slower rate compared to the huge 2014 increases…
Another stated goal of Obamacare was increased insurer competition – another area, unfortunately, where the law has not only failed, but made matters worse. If you compare insurer participation in Obamacare’s exchanges to the individual market prior to the law’s implementation, you find that the exchanges are about 21 percent less competitive at the state-level in 2015.
State-level numbers on insurer competition often overstates the actual choice available to consumers because insurance is generally priced and sold on a county or regional basis. Indeed, one-third of the nation’s counties only have one or two insurers offering coverage on their Obamacare exchange in 2015. That means insurer choice is either incredibly limited or non-existent for consumers in these areas.
Another 25 percent of counties only have three insurers offering coverage. Thus, the exchange market in 57 percent of U.S. counties features competition among three or fewer insurers in 2015.”
Priya Abraham, MA, Senior Policy Analyst for the Commonwealth Foundation for Public Policy Alternatives, stated in her Apr. 13, 2014 op-ed for the Mercury (Pottstown, PA), titled “My Obamacare Plan Is Failing Me”:
“As Pennsylvania moves to shift 6,960 people from its high-risk pool to Obamacare, more people will discover how limited their new coverage really is.
Information about covered drugs on Obamacare exchange plans is hard to find and in some cases doesn’t appear to be available at all. Restrictions on covered drugs are nothing new, but the limits are more widespread in exchange plans to keep premiums low.
Only one brand-name drug that works on the nervous system has helped me keep the pain [from fibromyalgia] at bay over the years. Getting it on my Obamacare plan has proven a challenge.
Just last week, my exchange plan insurer told me they will not cover the drug. For now, I’m surviving by driving 50 miles to pick up free samples from my doctor’s office. This isn’t the affordable, quality care I was promised.”
Avik Roy, Senior Fellow at the Manhattan Institute for Policy Research, stated in his Nov. 19, 2012 article titled “What States Should Build Instead of Obamacare’s Health Insurance Exchanges,” posted at forbes.com:
“Obamacare takes [the exchange] concept and distorts it in a critical way, by taking over the insurance market and micromanaging the design of insurance plans that can be sold on the law’s exchanges…[T]he thrust of Obamacare’s exchanges is to shoehorn consumers into a narrow set of government-approved products, so as to protect them from making choices that the government deems unwise. The side effect of this approach is to prevent insurers from coming up with innovative products that deliver cost-efficient care…
Imagine if the government required that you could only buy a home that was between 2,000 and 2,500 square feet, with two bedrooms, five electrical outlets, and a solar panel, and you get a sense of what Obamacare’s exchanges do.”
Michael Cannon, MA, JM, Cato Institute Director of Health Policy Studies, stated in his Mar. 21, 2011 article “Obamacare Can’t Be Fixed, and Now Is the Time to Dismantle It,” available at www.cato.org:
“Running their own exchanges won’t empower states to prevent both the most economical and the most comprehensive health plans from disappearing from their markets. Affordable plans will disappear because Obamacare requires all purchasers to buy whatever coverage Sebelius mandates as ‘essential,’ a definition that will grow ever broader, as such definitions always do. The law’s price controls will require insurers to charge everyone of a given age the same premium, regardless of whether an actuarially fair premium might be $5,000 or $50,000. Even state-run exchanges would see comprehensive health plans crumble under the weight of too many patients who cost $50,000 but pay far less. Nor can state-run exchanges prevent other dimensions of quality from eroding. Even in state-run exchanges, the sickest patients would struggle to get their claims paid by insurers who are trying to avoid, mistreat, and dump them, because that is what Obamacare’s price controls reward.
States that run their own exchanges will likewise be powerless to prevent HHS from loading health-savings-account (HSA) plans down with mandated benefits.”
Rita E. Numerof, MSS, PhD, Co-founder and President of Numerof and Associates, stated in her May 2012 article “What’s Wrong with Health Insurance Exchanges,” available at the Galen Institute website:
“The health insurance exchanges defined in PPACA won’t work, won’t increase access to affordable health care, and won’t do anything to improve health outcomes or increase value. The solution to affordable coverage isn’t to be found in these new bureaucracies, but rather in reducing barriers to competition and consumer choice and removing regulations that make coverage unaffordable today…
PPACA’s solution is to combine an individual mandate with health insurance exchanges, forcing consumers to choose from a limited slate of homogenized health plans, with federal subsidies available to some to offset the high cost of the plans.
PPACA’s solution is fundamentally flawed and unsustainable: It will limit choice, create new bureaucracies, cost consumers and taxpayers more, and put additional burdens on the states.”
Twila Brase, President of Citizens’ Council for Health Freedom, stated in her Feb. 27, 2013 op-ed titled “The Obamacare Exchanges Aren’t ‘marketplaces,'” posted at the Daily Caller website:
“Words can deceive, as proponents of federal health reform know well. Calling the proposed state health insurance exchanges ‘marketplaces’ is nothing but a veiled attempt to use free-market terms to describe a system that is anything but free…
The reality is that on state insurance exchanges available health insurance plans will be limited by a host of federal regulations; personal privacy will be violated, because the exchanges will be connected to various state agencies and a wide variety of federal agencies — including the Department of Justice, the Department of Defense, the IRS, the Social Security Administration and the Department of Health and Human Services — that will share citizens’ data without consent; the federal government will use an individual’s income, tax, employment, medical, family and citizenship data to determine eligibility for coverage and premium subsidies; and it will be impossible to purchase health insurance without federal approval.”