The opening of the health insurance exchanges may be anticlimactic after all the waiting and noise from supporters and critics of the Affordable Care Act. Health insurers and exchanges are expected to be ready, at least with minimal processes, to be able to enroll customers Oct. 1.
The real action still doesn't start until Jan. 1 2014, when insurance is activated, benefits can be administered and claims can be reimbursed.
Insurers are investing about $1 billion in advertising and marketing to get customers to log on to the exchanges, said Sarah Wiley, senior manager, Deloitte Consulting LLP (pictured above). And during this first year of the public exchanges, insurers will have a longer enrollment period, through March 2014, which is additional time to connect with and engage potential customers.
"No one believes that it will be a completely seamless experience on Oct. 1. While health plans don't necessarily expect it to be perfect, they are prepared and staffed and resourced to be able to address issues that arise," Wiley said. "As we continue for what will be a long enrollment period, it will work very smoothly."
Health plans anticipate having the right systems in place Oct. 1, are prepared to transact with exchanges as people come to the health plans, and have the processes and mechanisms to route individuals to the most appropriate place, she said.
Many large insurers view 2014 as a test year, though, participating in exchanges in only six or eight states in the first year. "Most have indicated to us that they expect to add other states in future years, but 2014 is that trial period," said Ceci Connolly, managing director of PwC's Health Research Institute.
"I think of the Oct. 1 date as the start of the marathon and not the sprint," she added.
Marilyn Tavenner, administrator of the Centers for Medicare & Medicaid Services, noted last week that Oct. 1 is just the beginning, but "it's an exciting time."
"Did we go from four insurers in one market to 40? No. Not overnight," she said at a conference sponsored by America's Health Insurance Plans (AHIP) in Washington.
"What we are seeing though is more transparency, more data, and more interest in entering markets and individuals asking a lot of questions…learning how to make the best decisions for you, your family, your business," she said.
Bright spots and tough challenges
Premium rates are a bright spot, said Sandra Hunt, principal in PwC's health services practice, adding that the rates offered through the exchanges are attractive relative to what has been available in the market. "That offers a great opportunity for consumers to look at what their current insurance coverage is and what they're paying for it," she said.
One of the issues that have required insurers to rethink their processes and workflows is premium reconciliation in order to bill accurately, Deloitte's Wiley explained. For some members, plans will receive some amount of subsidy toward their premiums, some of which will come from the federal government or through the exchanges. Plans will also bill individuals for their premiums.
Insurers have worked with a variety of strategies to make sure that they can administer payments from multiple sources accurately, she said. They have had to understand the workflows and sources of data and how to reconcile them in their system.
Assuring that IT interfaces link smoothly also has been a thorny challenge. "We won't know how well they're going to work until they go live," Hunt said. Large states have tested their systems and are ready to go live. But some states have decided after testing that they are not satisfied with the results and have developed contingency plans, "which include using paper enrollment on day one and continuing to work towards full electronic processes," she said.
Some have likened the end goal to "like a Turbo Tax experience, where you're putting in a certain amount of information and certain choices pop up," Connolly said. "We also know that different states have indicated that they won't have all the bells and whistles ready this fall in terms of online assistance and information, but will be phased in."
And if other large healthcare programs, like Medicaid's Children's Health Insurance Program (CHIP) and Medicare Part D for prescription drugs, are any indication, health insurance exchange enrollment will grow over time after the initial excitement by those who have been waiting for the program to open, Hunt said.