Insurers to reign in costs for ACA plans
September 07, 2015
A number of health insurers have lost money on their offerings sold through the health insurance exchanges. As The Wall Street Journal reports, some of these insurers are paring back their offerings or limiting consumer access to more costly providers. In general, this probably makes sense because the Affordable Care Act did little to address the healthcare costs directly, but did put pressure on premiums by making it easy to compare offerings across different insurers. So, if consumers still had access to the same expensive providers, and many sicker-than-average consumers who were previously unable to get medical coverage now access those providers, it's not surprising that health insurers fared worse than planned. It's also not surprising that insurers are trying to figure out how to limit their costs. An obvious way would be to limit access to the most expensive providers. Unfortunately, those providers might be the same ones that are often thought of as the best providers, even if there is little correlation between cost and quality in healthcare.
It might take consumers a few cycles, but eventually they'll understand that not all plans in the same tier offer the same benefits. When that happens, I expect that there will be more distinct segmentation of the offerings. For example, there might be a higher-cost insurance plan that offers access to a broader physician network, and a lower-cost plan that offers access to a narrower network. Hopefully, over time, there will also be more sophisticated tools to help consumers evaluate plans on these non-financial criteria. In the meantime, we should brace ourselves for some surprises about patients expecting specific doctors to accept their plan when that is not the case.