The landscape in the individual health insurance market has changed significantly over the last two years, necessitating a change in approach to stabilizing—and improving—the market. The individual-market Qualified Health Plans offered by issuers that also participate in Medicaid Managed Care tend to offer the lowest premiums and greater pre-deductible services. More than 13 million consumers purchase some form of comprehensive coverage on the individual market. Many more remain uninsured.
In recent years, the number of underinsured have also increased as deductibles have gone up and substandard coverage options have proliferated. Moving forward it is important to also consider the impact on underinsured consumers.
The Association for Community Affiliated Plans (ACAP) is working to address these challenges and has developed a set of recommendations targeted at improving the individual market risk pool and encouraging safety net health plan participation in the Marketplaces. They include:
- Reinstate the successful Federal reinsurance program.
- Adjust the community rating ratio in Marketplaces from 3:1 to at least 5:1 to more accurately price actuarial risk.
- Limit STLDI coverage so that it is not renewable over the long term, and serves its intended role as a stopgap.
- Require all short-term plans to have an end date of December 31 in a coverage year to coincide with open enrollment in Marketplaces.
- Implement a surcharge for members over the age of 65 who purchase Marketplace coverage.
- Permit safety net health plan issuers, as defined in 26 CFR 57.2 (b)(iii)(E), to enter the individual market while limiting their exposure through an enrollment cap based on risk-based capital.
- Provide for a rebate for young consumers that choose to enroll and rarely—but appropriately—use the health care system.
- Streamline enrollment by implementing a semi-automatic enrollment approach to coverage that allows consumers to initiate the enrollment coverage through Medicaid, CHIP, or Marketplaces.