Self-insurance popularity sends full-risk enrollment falling


As the self-insurance market continues to rise, commercial full-risk insurance declines. Commercial full-risk enrollment fell from 80.5 million in 2011 to 78.5 million in 2012--a 2.5 percent drop, according to findings from Citi Research.

The 2.5 percent enrollment drop shows employer interest in nonrisk products. What's more, private exchanges for small and large businesses could slow down the decline in risk-based enrollment. "[B]ut the benefits of self-funding are so significant for many employers that we believe risk enrollment will continue to shrink," the study states.

More employees are embracing the variety of plan options available on private exchanges. In February, one-third of roughly 1,230 organizations said they'll offer group-based health benefits to employees through a private exchange in the near future.

And as competition rises, premium increases could remain in the single digits for risk-based commercial plans, reports Healthcare Payer News.

Despite falling risk-based enrollment numbers, business for some large national plans--including nonprofit Blue Cross plans--remains steady. In 2012, the Blues held 37 percent market share of the commercial risk market. Excluding WellPoint, which holds a significant share in its 14 states, the overall market share of Blues plans rises to 42 percent, notes the study.

Sitting in the top spot for market share in 2012--across the combined individual, small and large group full-risk commercial markets--WellPoint held a 13.2 percent share. UnitedHealth Group had 12.1 percent, while Kaiser Foundation Health Plan followed with 10 percent, finds the study.

WellPoint also placed No. 1 in total membership, with 10.2 million lives. UnitedHealth Group came in a close second with 9.7 million lives, and Kaiser rounded out the top three at 7.1 million.

To grow membership and boost revenue, many insurers are either expanding or launching their own private exchanges, previously reported FierceHealthPayer.

For more:
- here's the Citi report (.pdf)

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