Monday, January 23, 2012

What consumers want in an insurance exchange

Consumers want purchasing power

A Reality Check from Consumer Advocates: Project Healthcare 

Our friends at Consumer Advocates: Project Healthcare offer the following guidelines and resources for consumers tracking the state's development of the insurance exchange required under the Affordable Care Act. The Governor's Office has scheduled a series of townhall meetings across the state to take comment on the exchange concept and on healthcare issues generally.
 Meetings are set in three towns this week, including Gillette, Evansville, and Cheyenne. All meetings start at 6 p.m. and end at 8 p.m.

  •  Jan. 23 in Gillette at the Gillette College Presidential Hall.
  • Jan. 24 in Evansville at the Community Center.
  • Jan. 25 in Cheyenne at Laramie County Community College's Centennial Room 130
CAPH's assessment on insurance exchanges:

Every dollar in the healthcare system comes from consumers’ pockets whether through premiums, direct payments to providers or income taxes that fund Medicare and Medicaid. But we consumers rarely have enough information to actively influence this sector of the economy.
The new federal healthcare law begins to change that.  While some insurance reforms have already been implemented a major change will begin on Jan. 1, 2014, when every state must have a new health insurance marketplace where individuals and small businesses can buy insurance.  A well-designed insurance exchange will give us access to the information we need to make discerning choices and that should motivate insurance companies to begin to actively compete for our business and loyalty.  
Wyoming must decide whether to build its own exchange, partner with other states or partner with the federal government to operate our exchange, CAPH urges decision-makers to focus on consumers and maximize this opportunity to strengthen benefits and provide important protections for all Wyoming citizens.
Should the state establish its own exchange? CAPH believes the state should avoid putting into place a system designed by insurance companies. Let’s explore a federal /state partnership designed to deliver benefits of the exchange to citizens in a timely way with the ultimate goal of moving operations from the federal to the state level over time.
We support the ‘no wrong door’ approach.  This allows people (individuals, families and small businesses) to find insurance no matter their income or where they start their search.  A single application will determine eligibility for public programs, calculate subsidies for those making less than 400% of federal poverty level or determine if an individual is exempt from the mandate to buy coverage. Exchanges should create a seamless interface with Medicaid and plan for continuity of care for those individuals moving between private and public insurance as income fluctuates.
Essential benefits should be as robust as possible to protect individuals from being under-insured. Consumers just want insurance to work—to pay for the care we need when we need it and it should protect our assets, so we don’t lose our homes or savings if we get sick or injured.  No tricks. No surprises. No gotchas.  All insurance products sold in the exchange will provide a standard benefit package that provides comprehensive coverage.  Deductibles and co-pays will vary but will be clearly labeled so consumers know exactly what part of healthcare costs are their responsibility.   This standardization will make plans easier to compare and provide the security insurance was meant to provide.
Insurance rules must ensure transparency and accountability.  Consumers should have access to all information that enables them to weigh the value of their plans such as how much of premiums are actually spent on medical claims vs. overhead, how often rate increases are requested, timeliness of claims payments and how often claims are denied and why. Consumer reviews and experiences should be easily accessible to all purchasers at the point of sale much like consumer reviews at internet travel sites.
Create and enforce strong private insurance rules and guard against adverse selection. The state can make sure the same quality standards apply to all insurance plans, whether in the exchange or not. This guards against the possibility that cheap, low- value plans will draw healthy people outside the exchange. An exchange with only sick people will cause prices to soar and undermine the success of the exchange.
Reserve the right for the exchange to serve as an active purchaser and not just accept all products offered for sale in the exchange.   Exchange administrators in Wyoming should be able – if they choose – to negotiate prices on plans that meet quality and value standards. This may be challenging in such a small state, but we should make sure it’s an option. This will help maximize market clout for consumers.
Provide strong consumer advocates and ensure pro-consumer leadership. Many customers will need help navigating the exchange and understanding all the decisions to be made in buying insurance. People designing and operating the Wyoming exchange should continually evaluate consumer satisfaction and use consumer concerns to guide ongoing improvement of the system.  Consumers want expert, pro-consumer leadership that can go toe-to-toe with insurers and industry representatives.
Exchanges should help to make healthcare in Wyoming more effective and efficient. Consumers expect to share in the overall goals of health reform: cost savings and improved quality of care.

For more information on health reform and exchanges, check out these websites and articles:  - Consumers can share their own healthcare stories here
Community Catalyst - Exchanges: Top Ten Priorities for Consumer Advocates

Kaiser Family Foundation --Explaining Healthcare Reform: what are insurance exchanges?

Families USA—Benefits of Exchanges
National Academy for State Health Policy—Health Insurance Exchange Basics

Center on Budget and Policy Priorities—An analysis of state exchange legislation