As the Affordable Care Act increased the number of Americans with health coverage, 45% of adult ACA exchange enrollees had chronic conditions in 2014 and 2015. That’s a higher percentage than those with employer-based insurance and in nongroup plans not in the exchanges, according to a new study in Health Affairs.
The report, which was written by Michael Karpman, Sharon K. Long and Lea Bart, all from the Urban Institute, found people in ACA plans used more healthcare services than those in other plans, which the study authors said is part of the reason for rising premiums in nongroup insurance.
- The authors warned that repeal of the individual mandate penalty in 2019 will force states to figure out how to stabilize nongroup premiums and protect coverage for adults with chronic conditions. That may include creating a balanced insurance pool.
The study found that the share of nonelderly adults who reported having nongroup coverage at any point was 3.8% in both 2012 and 2013, but that increased to 6.1% in 2014 and 7.9% in 2015 after the ACA exchanges started. The number of nonelderly adults with nongroup coverage increased from 7.4 million in 2013 to 15.4 million in 2015. All of those gains came via the ACA exchanges.
Nearly half of those enrolled in ACA plans in 2014 did not have health insurance at some point during the first six months of 2014. The researchers found gains in coverage among adults treated for chronic conditions in 2013 or 2014 can be attributed to ACA marketplace coverage. As the risk pool was filled with individuals with worse health, payers in turn charged higher premiums to balance the cost of care.
Those new members may not have enrolled in health insurance before the ACA because payers rejected them. Or payers may have charged them exorbitant premiums due to their chronic illnesses, so they couldn't afford coverage.
Enrollees in marketplace plans were more likely than other privately insured adults to have chronic conditions, such as diabetes and hypertension. The study found that a higher percentage of enrollees in the exchanges had chronic conditions (45%) compared to nongroup enrollees not in the exchanges (35%) and those in employer-sponsored insurance (38%).
Mental conditions, hyperlipidemia, chronic obstructive pulmonary disease, asthma and other respiratory conditions were the most commonly treated chronic conditions for those in ACA plans. More people may have insurance, but they also cost more to cover.
“While the expansion of marketplace coverage for adults with chronic conditions achieves a key objective of the ACA, it has also created new and ongoing challenges for insurers as service use and claim costs rose among people with nongroup coverage,” the report said.
Regarding the end of the individual mandate penalty in 2019, the report predicted the repeal will “reshape the nongroup market by reducing incentives for healthier individuals to obtain coverage — leading to a sicker risk pool and higher premiums.”
The repeal is part of a trend in which the Trump administration and a Republican-controlled Congress have sought to weaken the ACA. These actions include a shorter open enrollment period for ACA plans, budget cuts for ACA plan outreach, proposals to expand short-term and association health plans and the president cutting cost-sharing reduction payments to insurers in the exchanges.
However, the report highlighted other efforts that are trying to improve the exchanges, stabilize the risk pool and contain member healthcare costs. The Urban Institute, as well as a recent Commonwealth Fund report, said states will need to play a key role in protecting the individual market in the coming years.