They have been hailed by advocates as the answer for the millions of uninsured people seeking coverage. They have been lambasted by pundits as the beginning of the end of the U.S. health care system. Some states have embraced them, but others have turned down federal funding to build them.
They have been described as both overfunded and underfunded. Critics say they should just be defunded.
They were health insurance exchanges, but now they are marketplaces.
Love them or hate them, health insurance exchanges - or marketplaces - are open for business today, representing a centerpiece in the implementation of the Affordable Care Act.
In Colorado, the new marketplace is called Connect for Health Colorado. Here, people and small businesses can purchase health insurance coverage. No longer will people in the individual market be rejected for pre-existing health conditions and their premiums will be based solely on where they live, how old they are, if they smoke tobacco and the number and type of family members who are applying for coverage.
If their family income is at or below 400 percent of the federal poverty level ($94,200 for a family of four), they may qualify for federal subsidies to cover a portion of their premiums and cost-sharing.
Whether you are a proponent or an opponent, a supporter or a skeptic, read on. Here at the Colorado Health Institute, we have identified some important trends we will be monitoring to evaluate the success of the exchange. Here are our top five.
- How many - and which - Coloradans enroll in coverage?
Despite a new federal requirement for most people to obtain health coverage or pay a penalty, concerns remain that a disproportionate number of enrollees with significant medical conditions will sign up for coverage and sign up early. Conversely, a disproportionate number of healthier people may choose to pay the penalty and remain uninsured. If this phenomenon, known as adverse selection, occurs, premiums will be higher in order to fund the medical costs of the mix of those who do enroll. The marketplace needs to attract a large and diverse risk pool to keep premiums in check and remain financially sustainable.
- How easy is it to purchase coverage and gain eligibility for federal subsidies?
Purchasing health insurance coverage on your own has been referred to as an overwhelming and opaque process. Overlay that with the programmatic and technological complexities of creating a health insurance marketplace in two years, a marketplace that must be coordinated with a number of state and federal agencies, and it’s a herculean task. To guide people through the new system, insurance brokers as well as navigators who have been trained to help people understand how to shop for insurance, will be available to provide assistance. How successful Connect for Health Colorado’s customer support services are in helping Coloradans understand their health insurance options and premiums will be crucial for creating a consumer-friendly product.
- Does the marketplace advance market-based principles such as choice, transparency and competition?
The Affordable Care Act has been criticized for failing to reign in the high cost of care and coverage. Proponents of exchanges contend that these costs remain persistently high due to the lack of price transparency, competition and choice. Coloradans’ ability to easily and transparently compare prices and benefits of a variety of products, essential in a competitive market, will be crucial to promote competition and to mitigate premium cost growth.
- How seamless is the transition between the marketplace and other types of coverage such as Medicaid?
Eligibility for subsidies in Connect for Colorado and Medicaid are based on family income. As Colorado families’ income change and they qualify for different coverage options, CHI will be monitoring how easily they can move between insurance products without experiencing gaps coverage. If transitions are smooth, access to care will not be interrupted.
- And last, but certainly not least, does the marketplace increase the number of Coloradans with coverage that ultimately leads to improved access to care?
If the marketplace is successful, thousands of Coloradans will gain health insurance coverage. Historically, people with coverage have had greater access to care and improved health outcomes. However, fears loom that even if more people have coverage, they may not have access to care, especially primary care services, if there is a spike in demand. CHI will monitor trends in access and coverage.
The launch of the marketplace is a historic day and one that has been anticipated since the passage of the ACA more than four years ago. The success of the ACA and its goals to increase coverage hinge on this endeavor.
States throughout the country that opted not to build exchanges will be looking to Colorado’s marketplace for lessons they can learn. Politics will undoubtedly continue to play a role in the various interpretations of the results of the marketplace.
CHI, though, will continue to be your objective go-to resource for monitoring the success – or lack of success - of this historic undertaking.