As insurers spend the
next several weeks finishing 2020 bids for Medicare Advantage (MA) and Part D
as well as Affordable Care Act exchanges, their concerns center on the expected
return of the ACA's health insurer fee (HIF) in 2020.
Industry experts tell AIS
Health that the HIF's return alone wouldn't be significant for most managed
care companies, since plans pass the fee through to consumers via higher
premium rates — though they concede this pass-through may not be possible in
the competitive MA market.
"I would say that
the concerns are more about, will it [i.e., the HIF] actually return or not.
It's noticeable, it's [going to account for] 1% to 2% [of premium increase],
maybe 3% of premiums in the worst case…but it's not going to be the biggest driver
of your premium growth," says Jason Karcher, an actuary in the Milwaukee
office of Milliman, Inc.
To Ross Weiler, a
principal with Day Health Strategies LLC, the HIF is more of a market issue.
"It's just one more pricing challenge for the market which will result in
some people being unable to afford coverage," he says.
The bottom line?
"You're going to have winners and losers," Weiler says. "An
employer who can successfully move to self-funding fares better [since the HIF
won't apply], but that leaves the insured risk pool a little worse….So you've
got market dynamic changes that by themselves are not dramatic, but you add
them up" — and it could cause cost-prohibitive premiums.
Milliman expects the HIF
to reach roughly $15.5 billion in 2020, Karcher says.
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