The Affordable Care Act struck a popular chord by allowing adult children to obtain health coverage through a parent’s plan until their 26th birthday.
Now, seeking broad support for their efforts to repeal and replace the ACA, House Republicans have kept that guarantee intact. But it’s not clear whether that provision will be successful or a destabilizing force in the insurance marketplace.
The policy has proven to be a double-edged sword for the ACA’s online health exchanges because it has funneled young, healthy customers away from the overall marketplace “risk pool.” Insurers need those customers to balance out the large numbers of enrollees with chronic illnesses who drive up insurers’ costs — and ultimately contribute to higher marketplace premiums.This KHN story also ran in CNN Money. It can be republished for free (details).
Joseph Antos, a health economist with the American Enterprise Institute, a Washington, D.C.-based conservative think tank, said the ability for young adults to stay on family plans represents a “critical mistake” within the health law, cutting off insurers from a large, healthy demographic that likely would be able to afford a health care plan.
“This is essentially an ideal group for an insurance company,” he said. “They’re not going to use many services, and they’re going to pay their bills.”
The young-adult provision went into effect in September 2010 and families put it to use quickly, with many young adults leaving their own insurance plans. A report published by the Centers for Disease Control and Prevention in 2013 found the percentage of adults ages 19 to 25 with personal plans fell from nearly 41 percent in 2010 to just over 27 percent in 2012, while the ratio of those covered through a family member’s plan rose by 14 percentage points.
And the Department of Health and Human Services said last year that final 2016 marketplace enrollment numbers showed more than 6 million people ages 19 to 25 gained insurance through the health law, including 2.3 million who went onto their family health plan between September 2010 and when online marketplaces began operating in 2014.
Cara Kelly, a vice president of the health care consulting firm Avalere Health, said the provision’s effect must be understood in the context of the law’s implementation. Affordability and the selection of plans available in the marketplace also could have influenced the decision among young adults to buy or shirk insurance, Kelly said. Even if the provision had not been included in the law, she said, one can’t assume that the young adults would have signed up for coverage.
A little more than a quarter of marketplace customers in 2016 were adults ages 18 to 34, according to data from the Department of Health and Human Services. But federal officials and insurers had hoped for higher rates, noting that the group made up about 40 percent of the potential market.
Public support for the young-adult provision makes it difficult to take away. A survey conducted by the Kaiser Family Foundation in December 2016 found that 8 in 10 Republicans and 9 in 10 Democrats favored the benefit. (Kaiser Health News is an editorially independent program of the foundation.)
“It has been extremely popular,” said Al Redmer Jr., the Maryland insurance commissioner and chairman of the health insurance and managed care committee within the National Association of Insurance Commissioners. “So with that being the case, I don’t know if politically there’s an appetite to unwind it.”
Republicans have opted for different measures than the ACA to attract increased numbers of healthy, young customers and make the risk pools vibrant. To keep prices lower for these customers, the bill allows insurers to charge older people up to five times more than young adults. Under the ACA, that difference is 3-to-1, and Republicans say that made prices too expensive for younger customers.
It would also replace the health law’s individual mandate — the requirement that almost everyone have health insurance or face a penalty — with a 30 percent surcharge on their premium for late enrollment or allowing your insurance to lapse for more than 63 days within a year.
The overall effect, according to an analysis conducted by the Congressional Budget Office, would be a more stable market with a larger number of healthy enrollees. The report also estimated the bill could result in 24 million more people being uninsured.
But the bill also has disincentives for those young people. To help pay for premiums, low-income people will get tax credits based on age and household income. Older people would get $4,000 per year, twice as much as younger customers.
Insurers have reacted cautiously. The insurer Blue Cross Blue Shield Association released a statement this month expressing its support for increasing affordability for younger enrollees. But it also raised concerns about the Republicans’ tax credit proposal. A benefit based on age alone “does not give healthy people enough incentive to stay in the market, especially in the absence of an individual mandate.”
The insurance trade group America’s Health Insurance Plans sent a letter to House Republican committee chairmen voicing support for the 5-to-1 age-band rating and tax credits based on age.
“We have stated previously that there is no question that younger adults are under-represented in the individual market,” the letter said. “Recalibrating and reforming the way in which the premium assistance is structured will encourage younger Americans to get covered.”
KHN reporter Mary Agnes Carey contributed to this article.
A last-minute attempt by conservative Republicans to dump standards for health benefits in plans sold to individuals would probably lower the average consumer’s upfront insurance costs, such as premiums and deductibles, said experts on both sides of the debate to repeal and replace the Affordable Care Act.
But, they add, it will likely also induce insurers to offer much skimpier plans, potentially excluding the gravely ill, and putting consumers at greater financial risk if they need care.
For example, a woman who had elected not to have maternity coverage could face financial ruin from an unintended pregnancy. A healthy young man who didn’t buy drug coverage could be bankrupted if diagnosed with cancer requiring expensive prescription medicine. Someone needing emergency treatment at a non-network hospital might not be covered.
What might be desirable for business would leave patients vulnerable.
“What you don’t want if you’re an insurer is only sick people buying whatever product you have,” said Christopher Koller, president of the Milbank Memorial Fund and a former Rhode Island insurance commissioner. “So the way to get healthy people is to offer cheaper products designed for the healthy people.”Use Our ContentThis KHN story can be republished for free (details).
The proposed change could give carriers wide room to do that by eliminating or shrinking “essential health benefits” including hospitalization, prescription drugs, mental health treatment and lab services from plan requirements — especially if state regulators don’t step in to fill the void, analysts said.
The Affordable Care Act requires companies selling coverage to individuals and families through online marketplaces to offer 10 essential benefits, which also include maternity, wellness and preventive services — plus emergency room treatment at all hospitals. Small-group plans offered by many small employers also must carry such benefits.
Conservative House Republicans want to exclude the rule from any replacement, arguing it drives up cost and stifles consumer choice.
On Thursday, President Donald Trump agreed after meeting with members of the conservative Freedom Caucus to leave it out of the measure under consideration, said White House Press Secretary Sean Spicer. “Part of the reason that premiums have spiked out of control is because under Obamacare, there were these mandated services that had to be included,” Spicer told reporters.
Pushed by Trump, House Republican leaders agreed late Thursday to a Friday vote on the bill but were still trying to line up support. “Tomorrow we will show the American people that we will repeal and replace this broken law because it’s collapsing and it’s failing families,” said House Speaker Paul Ryan (R-Wis.). “And tomorrow we’re proceeding.” When asked if he had the votes, Ryan didn’t answer and walked briskly away from the press corps.
But axing essential benefits could bring back the pre-ACA days when insurers avoided expensive patients by excluding services they needed, said Gary Claxton, a vice president and insurance expert at the Kaiser Family Foundation. (Kaiser Health News is an editorially independent program of the foundation.)
“They’re not going to offer benefits that attract people with chronic illness if they can help it,”said Claxton, whose collection of old insurance policies shows what the market looked like before.
One Aetna plan didn’t cover most mental health or addiction services — important to moderate Republicans as well as Democrats concerned about fighting the opioid crisis. Another Aetna plan didn’t cover any mental health treatment. A HealthNet plan didn’t cover outpatient rehabilitative services.
The House replacement bill could make individual coverage for the chronically ill even more scarce than a few years ago because it retains an ACA rule that forces plans to accept members with preexisting illness, analysts said.
Before President Barack Obama’s health overhaul, insurers could reject sick applicants or charge them higher premiums.
Lacking that ability under a Republican law but newly able to shrink benefits, insurers might be more tempted than ever to avoid covering expensive conditions. That way the sickest consumers wouldn’t even bother to apply.
“You could see even worse holes in the insurance package” than before the ACA, said Sabrina Corlette, a research professor at the Center on Health Insurance Reforms at Georgetown University. “If we’re going into a world where a carrier is going to have to accept all comers and they can’t charge them based on their health status, the benefit design becomes a much bigger deal” in how insurers keep the sick out of their plans, she said.
Michael Cannon, an analyst at the libertarian Cato Institute and a longtime Obamacare opponent, also believes dumping essential benefits while forcing insurers to accept all applicants at one “community” price would weaken coverage for chronically ill people.
“Getting rid of the essential health benefits in a community-rated market would cause coverage for the sick to get even worse than it is under current law,” he said. Republicans “are shooting themselves in the foot if they the offer this proposal.”
Cannon favors full repeal of the ACA, allowing insurers to charge higher premiums for more expensive patients and helping consumers pay for plans with tax-favored health savings accounts.
In an absence of federal requirements for benefits, existing state standards would become more important. Some states might move to upgrade required benefits in line with the ACA rules but others probably won’t, according to analysts.
“You’re going to have a lot of insurers in states trying to understand what existing laws they have in place,” Koller said. “It’s going to be really critical to see how quickly the states react. There are going to be some states that will not.”
Mary Agnes Carey and Phil Galewitz contributed to this story.
Renata Louwers has a hard time getting her blood drawn. The needle, the pinprick of pain, the viscous liquid flowing out of her arm — they make her queasy.
So, Louwers had to steel herself when her husband, Ahmad Khoshroo, developed metastatic bladder cancer four years ago at age 72.
Within months, as a tumor pressed on his spine, Khoshroo was taking heavy-duty opioids and Louwers was administering his medications. When he developed blood clots following a stay in intensive care, she injected a blood thinner into his belly.
Figuring out what to do as her husband’s eventually fatal disease progressed was a nightmare. Louwers remembers getting hastily delivered, easily forgotten instructions from hospital nurses and, later, limited assistance from a home health agency. “It wasn’t much, and it was incredibly hard,” she said.
Now, groups around the country are mobilizing to help family caregivers like Louwers manage medications, give injections, clean catheters, tend to wounds and perform other tasks typically handled in medical facilities by nurses or nursing assistants.NAVIGATING AGING
Navigating Aging focuses on medical issues and advice associated with aging and end-of-life care, helping America’s 45 million seniors and their families navigate the health care system.
To contact Judith with a question or comment, click here.
For more KHN coverage of aging, click here.
In December, 15 organizations joined a new national consortium, the Home Alone Alliance, devoted to providing better training and instructional materials for family caregivers. Founding members include the AARP Public Policy Institute, the Family Caregiver Alliance, the United Hospital Fund and the Betty Irene Moore School of Nursing at the University of California, Davis.
This week, the alliance released a series of 10 short videos (five each in English and Spanish) designed to help caregivers deal with seniors who use canes or walkers and need help getting up or down stairs, into a wheelchair, or in and out of a tub or a shower.
Two of the videos deal with falls — the most common cause of injury among older adults.
This summer, nine videos on wound care and topics will be added and include dealing with newly sutured wounds, bed sores, cellulitis and diabetic foot care, among other topics, and, by the end of the year, another 20 videos should be available.
Potential topics include nutrition, the use of specialized equipment such as nebulizers, feeding tubes and oxygen tanks, and a revised series on medication management — a topic profiled in a pilot project for the alliance.
Organizations across the country will be free to put the videos on their websites. The goal is to disseminate them as widely as possible and “bridge the gap between what family caregivers are expected to do and what we actually teach them to do,” said Susan Reinhard, director of AARP’s Public Policy Institute.
That gap was highlighted in 2012, when AARP and the United Hospital Fund’s Families and Health Care Project published a groundbreaking report on medical and nursing tasks undertaken by caregivers. It found that 46 percent helped patients who required specialized care, but few got adequate training.
After the study’s publication, AARP started compiling educational materials from around the country that addressed caregivers’ increasingly complex responsibilities. There wasn’t much available.
With the United Hospital Fund, AARP convened focus groups and asked people what would be helpful. Don’t overwhelm us with information; break the material into chunks focusing on concrete tasks, they said. And tell us a story that we can relate to, involving people like us — not doctors and nurses, they requested.
Ongoing research into what works, from family caregivers’ perspective, will be an integral part of the Home Alone Alliance. And while videos will be a core component of the consortium’s offering, they won’t be the only one.
“It may be that within certain Asian communities, a video isn’t the best approach — we may want to partner with Asian resource centers and do ‘train the trainer’ sessions about caregiving,” said Heather Young, founding dean and a professor at the Betty Irene Moore School of Nursing at UC Davis.
In African-American communities, churches are a pillar of caregiving support and the focus may be on “helping congregations build their capacity,” Young said. “You can equip one person at a time all you want, but if there isn’t a broader context of support, a net around them, it’s very difficult to sustain the caregiving.”
Meanwhile, alliance members are developing plans for disseminating materials. The Family Caregiver Alliance will incorporate them in a new online platform for caregivers, FCA CareJourney — a source of support and resources that is still under development.
FCA began producing videos for family caregivers about four years ago; its Caregiver College series and SafeAtHome series have been watched by about 500,000 people to date. “We’re going to a more visual information exchange society,” said Kathleen Kelly, FCA’s executive director.
The U.S. Department of Veterans Affairs partnered with AARP in producing the alliance’s video series on mobility. It plans to post the videos on the VA’s caregiver website and encourage their use by patients discharged from rehabilitation and those served through its home-based primary care program, said Meg Kabat, national director of the VA’s Caregiver Support program.
Recognizing the value of videos, the VA’s Office of Rural Health has created a 20-module series on caring for someone with dementia and a five-part series on managing challenging behaviors associated with dementia. An extensive compilation of materials on various health conditions, Veterans Health Library, is also online, and another valuable resource for caregivers.
What’s missing from the current offerings is advice on dealing with older adults who are frail and have multiple conditions. Catherine Yanda’s 91-year-old mother, Mary, is in this situation: She has end-stage dementia, sarcopenia, heart disease, incontinence, frequent skin tears and difficulty swallowing — a set of problems that Yanda has had to figure out how to manage, largely on her own.
“I learn what to do as it happens,” said Yanda, who turns to FCA’s website for support and websites for nurses for information. “You go to whatever site helps you deal with the problem you’re trying to address. I’m lucky because I have the belief system that I can do it. But for some people, it’s just too much.”
We’re eager to hear from readers about questions you’d like answered, problems you’ve been having with your care and advice you need in dealing with the health care system. Visit khn.org/columnists to submit your requests or tips.
KHN’s coverage related to aging & improving care of older adults is supported by The John A. Hartford Foundation and its coverage of aging and long-term care issues is supported by The SCAN Foundation.