| HHS Secretary
Sylvia Mathews Burwell
The risk pool is a huge Affordable Care Act problem. When the Affordable Care Act was formed the idea was everyone would sign up and with millions in the risk pool, rates would drop.
That’s not exactly what happened.
With more people with health problems signing up than healthy people, insurers are losing more money than anticipated and rates are rising accordingly. The Department of Health and Human Services (HHS) said it is going to take three steps to counter the problem.
The first came last week when HHS said it is going to make changes in short-term insurance policies. They are not regulated the way other plans are so insurers are mostly selling them to young, healthy people. Most, it is assumed, pick up the plan to satisfy the law that says they must have insurance.
The new rule says the short-term plans will not be permitted to be any longer than three-months and once the three-months is up, the policy cannot be renewed. HHS says keeping young, healthy people off of the short-term plans means more them will enter the risk pool and help lower rates.
The next two step will involve work with state insurance commissioners and the third will focus on getting more young people to enroll.
HHS Secretary Sylvia Mathews Burwell told a room full of insurers and insurance commissioners, the department is looking to calm insurers who are doing huge rate hikes and to others looking to dump their ObamaCare participation. “I remain confident and excited about the benefits to consumers, insurers, and our entire healthcare delivery system from a transparent market where issuers can compete based on value,” Burwell said.
In theory that works. Reality is a much different story. Millennials — those who reached adulthood around the year 2000 — are dropping health insurance because they don’t understand the basics of insurance and because it’s just too expensive.
This according to the Transamerica Center for Health Studies. Here’s what it found in a recent study:
• The number of insured millennials has dropped from 23% in 2013 to 11% in 2016.
• However, 37% of those uninsured have never been insured.
Breaking down the 37% who have never been insured:
• Those 18 to 27 — 67%
• Women — 60%
• The unemployed — 68%
Men — however — are more likely to have private health insurance.
The biggest reason most don’t have health insurance is because they don’t understand it or the options open to them:
• 39% of the entire risk pool say they those options are too difficult to understand.
• When it comes to millennials the number not getting it rises to 54%
And then there’s the issue of affordability.
• 47% won’t apply for coverage in 2017 because of the cost.
Source links: Two from The Hill — Link 1 and Link 2 and Insurance Business America