With the introduction of the Affordable Care Act, the health insurance landscape in the U.S. shifted dramatically. In addition to providing affordable coverage for many low- and middle-income families, the rollout of the new law naturally replaces the need for insurers to provide mini-medical plans.
Mini-medical plans, also known as “junk insurance,” offer basic healthcare coverage, but place dollar caps on how much the plan will pay out per year in services. Many retailers, restaurants and other companies that hire low-wage workers have offered mini-medical insurance as a way to provide modest health coverage at a low cost to employees. Because coverage is limited, policy holders typically pay affordable premiums, but they also must pay out of pocket for the cost of any services that exceed their plan’s annual cap.
All similarities to ACA plans aside, healthcare advocates have criticized these plans as inadequate for years. In 2014, however, new rules went into effect that prevented insurers from placing annual caps on coverage. Yet, because of many businesses threats to abandon employee coverage should they be forced to comply with the new rules, the Obama administration responded by granting temporary waivers allowing a number of these plans to continue for a few more years.
That loophole will close this year, and many of those insured under mini-med plans will shift to plans under the exchange. The bigger picture, however, forces us to look at the future of employer sponsored insurance. In a 2013 CMS report, the foreshadowing is quite clear. “Enrollment [in non-exchange plans] is expected to fall through 2018, as some employers of low-wage workers are anticipated to stop offering employer-sponsored insurance. Most of these employees would then purchase coverage on the Exchanges or gain coverage through Medicaid. In addition, a new excise tax on high-cost employer-sponsored insurance plans starting in 2018 is expected to slow growth as employers and employees are expected to choose lower-cost plans that are valued below the tax’s threshold.”
If the end of employer-sponsored health plans is indeed where we’re headed, and I believe it is, some concerns need to be addressed. What about the narrow networks under the exchanges that limit timely access to care and further drive increased utilization of ED and hospital-based services? And how will Americans deal with the major shift in the financial burden of healthcare to patients and physicians, trying to collect payment for services? As we move through 2015, it will be important to understand the effects of these changes on practices. Data collection and modeling will allow radiologists and other specialty practices to anticipate revenue changes and put tools in place to mitigate some of the negative impact.