By Leslie Small
Two of the biggest factors likely to determine premium rate
changes for Affordable Care Act exchange plans in 2020 are overall medical
trend and potential adverse selection caused by non-ACA compliant plans,
according to a recent issue brief from the American Academy of Actuaries (AAA).
But regarding the latter factor, an important caveat is that the
expansion of short-term, limited-duration (STLD) plans and association health
plans (AHPs) probably won't increase premiums everywhere and in equal measure,
Cori Uccello, a senior fellow at the AAA, tells AIS Health.
In general, new regulations expanding STLD plans and AHPs can
put upward pressure on ACA-plan premiums if those noncompliant plans attract
healthier people away, she says. But the effect can vary quite a bit by
geography and insurer.
In fact, some health plans may have previously overestimated the
impact that non-ACA-compliant plans would have on the market. The AAA issue
brief says that the same may be true for the zeroing-out of the individual
mandate.
However, the smaller-than-expected effect of AHPs and STLD plans
on the individual marketplaces may not last, Uccello cautions.
"The other thing with these noncompliant plans is that even
if there's not necessarily a lot of enrollment when they are starting to be
rolled out, that doesn't mean over time they might not enroll a larger share of
people," she says. And when that happens, insurers could make more
significant upward adjustments to their premiums.
From Health Plan Weekly
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