Study: More than half of exchange products are HMOs, EPOs

In a new study that examined plans offered on the Affordable Care Act exchanges, the the Blue Cross Blue Shield Association found insurers are offering more health maintenance organization (HMO) and exclusive provider organization (EPO) plans in 2016.

The study showed that consumer choices on the exchange marketplace vary across the country, but that in 2016 in most regions consumers still have multiple plan options. Most states this year have at least three health insurance carriers offering plans, similar to 2015. However, the types of health plans being offered are changing to meet the needs of consumers and manage risk for health insurers, the study said.

Insurers are offering more "narrow network" plans as options to consumers who are seeking lower out-of-pocket costs, the study found. The number of HMOs and EPOs increased from 41 percent in 2015 to 52 percent in 2016. HMOs were also among the lowest priced plans. In 2015, the lowest cost silver plans in 47 percent of all counties in the U.S. were HMO products, which increased to 58 percent of counties in 2016.

The BCBSA study is not the first to note that narrow-network plans are becoming more common in the ACA marketplace; the Robert Wood Johnson Foundation reports that two-thirds of the insurance companies offering preferred provider organization plans last year on the marketplaces have either reduced the number of these plans they offered or will stop offering them at all in 2016.

The study also found that differences in pricing for the same types of health plans are narrowing. The authors attributed less variation in price in the markets to the fact that insurers are able to price products more accurately given more data and greater experience on the exchanges. For instance, in 2014 more than 29 percent of counties had the lowest cost silver plans priced more than 10 percent less than the next lowest competitor's option. That gap closed to less than 5 percent in 2015 and to only 1 percent in 2016 when comparing the price difference between the two most affordable silver plans.

 "With the ACA now in its third open enrollment period, insurance carriers are applying more data--including the actual healthcare costs of newly-enrolled members--to design offerings that more accurately meet the needs of consumers in this new market," Maureen Sullivan, chief strategy officer and senior vice president of strategic services for BCBSA, said in an announcement about the study.

According to recent government figures, more than 11.3 million people have chosen health coverage through Healthcare.gov and the state exchanges. 

To learn more:
- read the study (.pdf)
- here's the announcement

 

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