Smart Benefits: Enrollment in Health Exchanges Not So Simple

Monday, May 06, 2013


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To really understand the direction of where Obamacare is headed, first think back three years ago when proponents started pitching the idea of how easy it would be for consumers to access affordable care through an Exchange. Many idealists proposed that accessing coverage under this new system would be as easy as planning a vacation using Travelocity. The Exchanges would, after all, be like a virtual marketplace for consumers to consider and purchase healthcare.

Purchasing Healthcare Not A Vacation

Planning for a vacation couldn’t be more different than shopping for health coverage. Planning for vacation is at first a fun experience, while purchasing health insurance is often confusing and sometimes emotional. And, to use Travelocity, one must have access to, and be able to use a computer. Otherwise, there are experienced travel agents available to plan a vacation for you.

Now fast forward, and as we near closer to the opening of the health benefit exchanges this coming January, the comparison to Travelocity seems no longer appropriate. The Exchanges have taken on lives of their own, way beyond the outer limits of a web-based tool. With the realization that the target market of consumers likely to use an exchange will at first be mostly Medicaid and lower income individuals, extra help will be needed, especially to help these consumers complete the lengthy, but now shortened enrollment/subsidy application. In early March, Health & Human Services (HHS) released a draft 21-page enrollment/subsidy qualification application which immediately drew criticism from all sides as being anything but simple and easy to complete. This week, President Obama announced a newly tweaked 3 page application (for an individual, that is). There are actually three versions of the shortened application:

  • 1. Application for Health Coverage and Help Paying Costs (Short, 3-page form for individuals)
  • 2. Application for Health Coverage and Help Paying Costs (Longer 7-12 page form for families)
  • 3. Application for Anyone Wanting Coverage, but unsure of eligibility (Safe to say, if they find out they meet eligibility, they will eventually find their way to one of the above two forms)

Interestingly, these applications will be used by the federally run exchanges in states who did not sign up to run their own exchanges. The Affordable Care Act (ACA) requires the exchanges to have systems where consumers can apply and receive determination of subsidy qualification, using a single-streamlined form. However, states can choose to use or adopt the form, or develop an alternative. The only catch is that the forms must be accepted online, in person, by mail or phone, and accepted by the Exchange, Medicaid and CHIP agencies. The form is also supposed to be simple and easy to complete.

According to State, an online network for health reform implementation that tracks state by state progress, Massachusetts has already developed a single application and has a program to assist individuals and families with completing forms. RI has established a plan for an integrated enrollment system, but has not yet developed the application. This may be a good thing, because several states are reporting that their enrollment systems have been designed around the 21 page application and now must make expensive changes to accommodate the new, shorter-version forms.

Even the shortened form requests enough information to complete a short biography about any person, as there are detailed questions that require an entire life’s worth of personal and financial information on the pages.

Navigators Needed to Get Through Applications

Just to get people through the application, there will be an increase in resources – and that means hiring more government employees to do the job. The feds have released details on the Navigators, which are essentially high paid customer service reps to guide individuals through the applications and answer questions. How many navigators will be needed and how much will they be paid? HHS estimates that tens of thousands of navigators will be needed. According to the Federal Register document, the average salaries will range from $41,600 to $100,000, depending on rank. The federal government will provide grants to pay for those Navigators working on federal exchanges. States like Rhode Island and Massachusetts, are left to hire and pay their own Navigators.

Navigators? Brokers? Or Both?

The problem is that Navigators are in some ways duplicative to some services already provided by benefit advisors and brokers. According to the Bureau of Labor Statistics, there are already 337,000 private –sector insurance sales agents working in the U.S, at an average salary of $63,400 per year. This is less than what the government is going to pay likely to be less-qualified Navigators. States are left on their own to decide to use benefit advisors and brokers in addition to the Navigators. Rhode Island, will use them for small businesses who purchase through the SHOP side of the Exchange, and will use Navigators for those on Medicaid and Individuals. Several years ago Massachusetts at first excluded brokers, but later added them in an effort to boost small business enrollment.

The forms are in English, but states have made requests for the forms in as many as fifteen different languages. No doubt, bilingual Navigators, and/or translators will be needed too if this is the case. And for those without computer knowledge, there are computer-literacy concerns, requiring that more help will be needed.

Exchanges have morphed far from the easy, virtual marketplaces they were touted to be. Many states are adding physical office space so consumers have personalized support when enrolling. There will be an army of experts needed to get people through the forms, to translate to them, and to answer questions. The system is creating a lot of layers and at a very expensive price tag, and patient care has yet to be addressed.

Enrolling in the Exchanges will be anything but simple and easy, and certainly not like planning a vacation. Let’s hope the phone lines are clear when people start calling for help on January 1st.  

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Amy Gallagher has over 19 years of healthcare industry experience. As Vice President at Cornerstone Group, she advises large employers on long-term cost-containment strategies, consumer-driven solutions and results-driven wellness programs. Amy speaks regularly on a variety of healthcare-related topics, is a member of local organizations like the Rhode Island Business Group on Health, HRM-RI, SHRM, WELCOA, and the Rhode Island Business Healthcare Advisory Council, and participates in the Lieutenant Governor’s Health Benefits Exchange work group of the Health Care Reform Commission.


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