It is getting old to keep talking about the insurance exchange plan availability and premium woes. It is a small part of the overall health coverage market, and getting smaller. But it was the critical element in expanding the number of insured, particularly since it was accompanied by a mandate that every adult have health insurance. This was supposed to be the affordable mechanism by which people could meet that requirement. Consultant McKinsey has released an analysis indicating how much the exchange model has deteriorated since its inception. (McKinsey Analysis) The analysis covers 2017 premium filings in 18 states and DC. They find that the average catastrophic plan has a premium increase of 17%, bronze 14%, silver 11%, gold 14% and platinum 7.6%. Catastrophic, bronze and silver plans are seeing price increases that are over twice as high as the average increase in 2014 or 2015, while gold plans are almost twice as high and only the very expensive and rarely purchased platinum plans have increases in line with prior years. While the average increase for the benchmark silver plans is high, many consumers will still have a lower price plan available in 2017. And for those getting subsidies, the net average actual increase in dollars is pretty low, although that just means taxpayers are spending more on their behalf. There is also significant variation across the states in terms of the premium increases. Amazingly, there are still insurers coming in and offering lower prices; apparently not having learned the lesson that this is not a profitable business from watching competitors who have floundered.
Consumers looking for coverage on the exchanges have problems other than premiums. In many markets there is now a much more limited choice of plans, as many insurers have stopped offering health plans on the exchanges, after suffering heavy losses. The plans that remain tend to have limited provider networks. This means that a consumer may have to change their current physician, which certainly isn’t good for coordination of care. I have seen commentators who suggest that consumers aren’t so bad off if their current plan raises premiums significantly, because there often will still be a cheaper one available. But these changes of plan can be traumatic, involving not just a change in providers, but learning new benefits and new administrative procedures. It is better for patients health care and quality of life to have continuity of plans and providers. It is now clear that the reform law exchanges are pretty much a failure at providing affordable health care coverage. No one seems to have good ideas about what comes next.