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Consumer Cost-Sharing Changes in Exchange Plans

By May 24, 2016Commentary

2017 is shaping up to be a killer year for reform law health insurance exchange premium increases, and probably higher cost-sharing.  A Commonwealth Fund report focuses on the changes in cost-sharing in these plans from 2015-2016.  (Comm. Fund Report)   The amount of cost-sharing is largely tied to the plan type.  Each plan type–platinum, gold, silver and bronze–has to meet certain actuarial values for the benefits, with the lower tiers having lower coverage overall.  That means higher cost-sharing, but usually lower premiums.  So cost-sharing can increase either because deductibles and copays or coinsurance increases within a plan or because the consumer switches to a lower tier plan.  Cost-sharing is a concern not just because of the financial implications but because it may deter use of appropriate services as well as inappropriate ones.  According to the Commonwealth Fund, from 2014 to 2015, premiums and cost-sharing for exchange plans did not change.  From 2015 to 2016, the Fund reported that premiums rose by an average of 6%.  This report looks at cost-sharing changes.  A major caveat is that the analysis is of offered plans; it is not based on a weighted average of actual enrollment in plans.  The latter would tell you the real impact on consumers.  Excluded from the analysis are certain silver plans in which some consumers get cost-sharing reductions.

One type of cost-sharing declined from 2015 to 2016, generic drug copays by 3%.  Three types rose significantly; out-of-pocket limits by 7%, annual deductibles by 10% and copays for non-preferred drugs by 14%.  Copays for specialty visits rose 4.9%, copays for preferred branded drugs rose 4.7% and copays for primary care visits by .4%.  Sounds to me like if you weighted it by frequency of copay you would have fairly hefty growth, certainly higher than personal income growth.  Almost 100% of bronze and silver plans have general deductibles and that is where most exchange plan enrollment is, and an even higher percent of people enrolled in them for 2016.  The average deductible in a bronze plan is $5724 and in a silver plan, $3100.  In a number of bronze and silver plans the deductible must be met before drugs or even primary care visits are covered.  Coinsurance is used for provider outpatient services in a fairly small percent of bronze and silver plans but flat dollar copays are not small for these plans; an average of $43 for primary care and $84 for specialty care for bronze; and $31 and $59 for silver.  And of course, what is most interesting is that even with these relatively high and increasing cost-sharing amounts, we are in for much higher exchange premiums for 2017.

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