Posted in Accountable Care, ACO, Affordable Care Act

Vetting the ACA’s Impact on Health Insurance Operators

by Gregg A. Masters, MPH

Milliman Health 2013 Briefing Paper ACA ResultsIn contrast to the comprehensive ‘go live’ implementation of ‘RomeyCare’ in the Commonwealth of Massachusetts, the phased (and some would say diluted if not ‘fatally’ compromised) implementation of the Affordable Care Act (ACA) has been muted via a staggered on-boarding schedule of its various component parts and further selectively waived or delayed provisions primarily for political considerations.

Yet, we’re now some 3 1/2 years since enactment of the spirit of the ACA in March of 2010. One of the arguably principal accountability players to advise, measure, and report on the success or failure of the Act’s specific provisions are the good folks at Milliman Health – principal ‘actuaries to the stars’ of sorts.

Milliman often consults on the front end of risk assumption, mitigation – if not avoidance – in the shift from volume-to-value. They also measure and monitor the aggregate performance of the law based on their access to propriety client derived data sets, those residing in the public domain as well as tapping secondary sources in the market place as proxies.

Recently Milliman issued the Briefing Paper: ‘2013 Commercial Health Insurance – Overview of Financial Results’ wherein the report notes:

‘With the Patient Protection and Affordable Care Act (ACA) enactment in March of 2010, health insurers have had to comply with minimum loss ratio requirements, more stringent rate reviews, removal of annual benefit limits, first dollar coverage of preventive care, and other requirements. The insurer experience for 2013 reflects the third year insurers have been required to comply with minimum loss ratio requirements. Additionally, 2013 marks the final year that medical underwriting was not prohibited for new business in the individual and small group comprehensive health insurance markets in many states. Therefore, 2013 commercial health insurance can be used to both evaluate the impact of ACA reforms that were implemented prior to 2013, as well as serve as a benchmark to evaluate insurer financial results moving forward’.

Suffice it to say, there is more meat in the report sourced from various indicia of market performance, but witness the Milliman general conclusion noting:

Milliman  Health Breifing Paper on ACA Results 2010 - 2013

The report provides ‘an overview of health insurer financial results in 2013 and evaluated changes in the health insurance industry’s expense structure and profitability from 2010 to 2013, including changes in the medical loss ratio.’ 

The report’s conclusions are rather instructive and a testimonial of how imposing ‘order’ (or some degree of plan standards and thus comparability to an arguably cowboy market – primarily the individual insurance domain) – has impacted the operations of market participants.

Basically, Milliman is saying some patterns can be more clearly discerned (in group market) while in truth there are too many moving parts and it’s perhaps to early to tell at least in the individual market.

For complete report access click here.

Comment

It remains to be seen how the political theater if not continuing litigious climate will impact the future performance of this initially proffered conservative health policy ideology muscled only into law via straight party line voting. The complexity of our healthcare system is such that any material effort to arrest, mitigate and redirect its underlying healthcare economics will be met with special interest agenda driven resistance if not outright mass public deception.

So in the spirit of the 70s rock band Kansas viaCarry on my wayward son‘, lets be mindful of the timeless advice of Mr. Rogers offered during times of deep national tragedy:

Look for the helpers. You will always find people who are helping.’ ~ Frederick “Fred” McFeely Rogers

 

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