Private exchanges must adjust amid slow growth
The early struggles of Healthcare.gov helped private health insurance exchanges hit the ground running, but market forces hinder the ability of these exchanges to make further progress, the Daily Signal reported.
Sites such as eHealth Insurance, GetInsured and GoHealth existed prior to the Affordable Care Act, but the creation of Healthcare.gov suddenly gave the private exchanges a public competitor, the article noted.
Those three private exchanges signed contracts with the government that allowed them to enroll customers eligible for ACA subsidies in the states using the federal exchange.
At first, the private sites performed quite well, the Daily Signal noted--especially in light of the Healthcare.gov glitches that plagued the first weeks of open enrollment in 2013. In fact, eHealth went so far as to offer to help the Obama administration run Healthcare.gov.
A bust soon followed the boon, though. Earlier this year, eHealth laid off 160 workers, citing increased competition and a struggle to enroll older individuals as well as families, the Daily Signal said. Both tend to opt for higher-premium plans than the young adults eHealth enrolled in large numbers. Meanwhile, 11.7 million people have obtained insurance using Healthcare.gov or the state exchanges.
To compete, the private exchanges boosted their marketing budgets--as has Healthcare.gov, for that matter--and placed an added emphasis on customer service and decision-support tools, according to the Daily Signal.
Meanwhile, private exchanges that cater to the commercial group market face similar obstacles, according to Healthcare Payer News. Though payers such as Cigna and Aetna have made significant investments, employers have been bearish on private insurance exchanges, taking a "wait and see" approach to adoption, FierceHealthPayer previously reported.
The slow growth is not unexpected, though Cigna and Aetna executives have high hopes for longer-term sustainability, Healthcare Payer News said. One possibility for private exchange growth potential may be high-end ancillary products such as life or disability insurance, the article said.
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