Should You Accept Insurance Exchange Coverage?
It remains unclear how the influx of newly insured patients through the Health Insurance Marketplace will affect private practice health care practitioners. For many private practices, the increased patient load comes at a substantial price in the form of increased administrative and regulatory burdens and lower remuneration. The overall effect of public and private exchanges on private practices may not be known for several years.
Practice Points
- Many private practitioners remain ambivalent about participating in the new Health Insurance Marketplace plans under the Patient Protection and Affordable Care Act. Problem areas include lower reimbursements, high deductibles and/or co-pays, and the infamous 90-day “grace period.”
- Small practices will have to balance the additional administrative and regulatory burdens and lower remuneration against the need to remain competitive.
- It may take years to evaluate the overall effect of public and private exchanges on private practices and on the American economy in general.
Higher Deductibles
Another problem is the trend toward higher deductibles, which has only been exacerbated by the exchanges. Public exchange plan options are labeled platinum, gold, silver, bronze, or catastrophic to differentiate their levels of coverage, with platinum having the best coverage and highest premiums, and catastrophic the worst coverage and lowest premiums.10 In general, the worse the coverage, the higher the co-pay and deductible; the cheapest plans may have deductibles as high as $4000.11 By requiring patients to authorize use of a credit card, physicians will be better equipped to deal with those with the cheaper plans and higher out-of-pocket costs.
Private Exchanges
To complicate matters further, there also are private exchanges, which are created by private sector companies and therefore are not part of the PPACA. They offer no government subsidies and no grace period. Employers looking for a lower-cost alternative to conventional private coverage may offer their employees a set amount of money for insurance and then direct them to a private exchange where employees can select various options based on the employer’s payment.
Conclusion
The overall effect of public and private exchanges on private practices and on the American economy in general may not be known for several years. A recent editorial in the Wall Street Journal suggested that the exchanges have already had a substantial negative influence on the gross domestic product.12 Nonetheless, it is already clear that exchanges are going to change the way millions of Americans choose their health insurance and how they use their benefits. Private practitioners will have to monitor these changes closely in the coming years.
