State regulators are working with several tools to keep Patient Protection and Affordable Care Act regs from destabilizing their markets.
Linda Blumberg of the Urban Institute – among others – have described the efforts in a report from the Robert Wood Johnson Foundation.
The researchers focus mainly on efforts to manage the health insurance market in states setting up their own exchanges.
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The researchers also looked at two states, Illinois and Michigan, that are letting the Department of Health and Human Services run their exchange programs.
PPACA tried to help older and sicker people get affordable coverage by prohibiting carriers from considering pre-existing conditions when issuing or pricing coverage, and by limiting how much more premiums can be for older insureds than for younger ones.
To prevent some carriers from getting more than their fair share of young, healthy insureds, states have taken steps such as tinkering with the rules for age-based pricing, limiting early renewals of policies written using pre-PPACA rules, and limiting sales of cheap, high-deductible, catastrophic policies that seem likely to appeal to the healthiest consumers, the researchers say.
Many states have tried to set provider network standards, to ensure all plans offer the specialists that sick people need, and to impose plan standardization rules much tougher than the PPACA standardization rules.
Four of the states the researchers studied – Colorado, Maryland, New York and Oregon – have tried to standardize broker compensation inside and outside of the exchange system, to try to keep brokers from steering customers toward certain markets.
A slightly different four-state sampling – Maryland, New Mexico, New York and Oregon – is locking carriers that failed to participate next out of the system altogether until after 2016.
States also are using reinsurance programs and other types of programs to protect carriers that end up with higher-cost enrollees, the researchers say.
"Minimizing the impact of adverse selection – both against the overall insurance market and the exchanges – will require strong monitoring and oversight," the researchers conclude.
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Allison Bell
Allison Bell, a senior reporter at ThinkAdvisor and BenefitsPRO, previously was an associate editor at National Underwriter Life & Health. She has a bachelor's degree in economics from Washington University in St. Louis and a master's degree in journalism from the Medill School of Journalism at Northwestern University. She can be reached through X at @Think_Allison.
