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Medical costs went largely unchanged as the Affordable Care Act exchange enrollee risk pool improved between 2014 and 2015, the Department of Health and Human Services says in a report that runs counter to insurers' reports of continued losses on the exchanges.
Claims per-member-per-month fell by 0.1 percent due to a more diverse mix of enrollees, according to the report. By comparison, medical costs in the private insurance market experienced 3 to 5 percent cost growth.
HHS' announcement comes in the wake of ongoing worries about the viability of the ACA exchanges. Insurers such as Aetna have pointed to specialty pharmacy costs and higher-than-expected utilization costs as reasons for pulling back plan offerings in the exchanges.
But the report says 2 percent premium increases in 2015 were more than enough to offset the modest 0.1 percent in costs.
Premiums for "benchmark" silver plans are slated to jump an average of 9 percent in 2017, indicating insurers' attempts to cover higher costs with corresponding premiums. Some healthcare analysts see the hike as a way for insurers to “catch up” after mounting financial losses.
HHS' report shows that the marketplace stands on solid ground, said HHS counselor Aviva Aron-Dine, according to Kaiser Health News. Despite some critics’ hesitation about the ACA’s viability, it is likely policy adjustments could sustain the healthcare law’s most prominent feature, she added.
For example, a recent Centers for Medicare & Medicaid Services blog post says that with the federal reinsurance program set to end, some states are considering their own reinsurance initiatives. The agency also says it is considering reforms to the current risk adjustment program.
- read the HHS report
- here is the CMS blog post
- check out the KHN article