2014 Preview: What's in store for health insurers
Now that the calendar has switched to a new year, the health insurance industry is facing a slew of new developments under the healthcare reform law. So FierceHealthPayer compiled a list of four changes coming down the road that will affect health insurers in 2014:
1. Essential benefits
Starting this year, all insurers must provide certain essential health benefits as required under the reform law. In preparation for the minimum standards, many insurers canceled their plans that didn't meet the 10 mandated benefits. Due to the public backlash over the cancellations that led to President Barack Obama extending those canceled plans, insurers move into 2014 with a two-pronged approach--one that analyzes whether and under what conditions they will reinstate canceled plans, and another approach that addresses their transition plans for including coverage for the essential health benefits. Many health insurance companies have said preparing to cover the essential benefits has taken several years, including restructuring entire lines of plans. They also have to determine how to handle a potential spike in medical utilization as consumers seek treatment in these newly covered areas.
2. Medicaid expansion
The highly debated expansion comes to fruition this year when the Medicaid program opens to include consumers with incomes that are 133 percent of the federal poverty level. Some states have opted out of the Medicaid expansion, most notably Florida, Louisiana, North Carolina, Pennsylvania and Texas. Other states, led by Arkansas, are expanding Medicaid using a private option approved by the federal government. One key challenge facing HHS, however, is developing "robust oversight" of the expansion, including keeping an eye on state compliance with eligibility requirements. As the year continues, insurers could see huge boosts in enrollment as a result of some states' expansion plans.
3. New member analysis
As insurers welcome millions of new members through the online marketplaces, they will need to manage big data in a new way. Because many of these new members will be obtaining health coverage for the first time, they must learn how to use the healthcare system, including when to treat conditions and how to maintain healthy lifestyles. What's more, insurers must get to know these new members--they don't look like the typical insurance members as they have different demographic profiles and health needs than the currently insured population. Therefore, insurers must analyze data available on this new member population to identify any gaps in care, track emerging health trends and decrease healthcare costs.
4. Mobile apps, technology
The use of mobile apps has dramatically increased in the last few years, and insurers are likely to continue that trend as they launch new mobile tools to help consumers stay healthy while improving health outcomes and decreasing medical utilization. Aetna, for example, is looking to improve healthcare quality and control costs through high-tech products like mobile apps. The company expects these tech tools to create more than $1.5 billion in revenues this year. Meanwhile, Cigna and Kaiser Permanente successfully use technology to engage consumers by offering mobile apps for Android and iPhones, online payment estimators and multiple social network accounts. With the influx of new members insurers stand to enroll through exchanges, mobile apps and other tech offerings stand to help insurers lower their costs while keeping the industry fresh and competitive.
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