Nevada’s health insurance exchange is focusing on enrollee retention this year as it starts its first enrollment period following its split from Healthcare.gov.
With enrollment set to start on Nov. 1, the Silver State Health Insurance Exchange — which runs the Nevada Health Link site — is leaving the federal site it has called home for the last five years as a hybrid exchange. Instead, Nevada is switching back to being a state-based exchange by contracting with third-party vendor GetInsured.
It will be the first time for the state to operate its own site again since its disastrous launch in 2013 with then-contractor Xerox. The program’s first year was marred by an assortment of glitches, including sign-up delays, insurance card issues and non-credited payments. The issues earned the ire of then-Gov. Brian Sandoval and also caused the Silver State Health Insurance Exchange to ultimately fire Xerox and switch to Healthcare.gov.
Although the federal site helped Nevada recover from its problematic launch, Healthcare.gov posed challenges when it came to providing data. It also started charging the state more for using the site. In the previous plan year, for example, The Nevada health exchange collected 3.15% of gross premiums from carriers as revenue. The bulk of that ended up as payment for the use of Healthcare.gov, a cost of $10.7 million. This meant the exchange only had a little over $500,000 left over for its budget.
“Healthcare.gov’s rigidity was totally inflexible for the state — we couldn’t see our data and had no real-time access to see who was enrolling,” said Heather Korbulic, CEO of the Silver State Health Insurance Exchange. “The rent was also too high so we decided to look at a fair market option.”
The ‘X’ word
Even as Nevada’s health insurance exchange decided it wanted to part ways with Healthcare.gov, one incident continued to serve as a cautionary tale for the state program.
Korbulic did not head Nevada’s health exchange back in 2013. To this day, however, the Xerox incident continues to haunt the agency.
“Xerox is the ghost that follows everyone in the room,” Korbulic said.
To ensure that there isn’t a repeat of the program’s disastrous launch, Nevada looked for a contractor with a track record when it came to working with exchanges. The state ultimately decided on GetInsured, which provided a technology platform for six state marketplaces, including Idaho and Washington. That portfolio will grow to eight this year with the addition of Nevada and Minnesota.
For Nevada, the cost of using GetInsured’s technology and call centers was $5 million. The state also paid $1 million for the design, development and implementation of its exchange. The total cost represents $4 million in savings for the first fiscal year alone, according to Korbulic.
“It tells you we’re using an off-the-shelf product,” Korbulic said. “Almost all the state exchanges use several vendors for different pieces of the puzzle but we’re using just one.”
Also important is the agency’s long-sought access to more comprehensive, real-time data that the exchange could not get from Healthcare.gov. This means that the state exchange will be able to do more targeted marketing instead of using the blanket approach it has employed since switching to Healthcare.gov.
Playing defense
In 2018, Nevada Health Link hit a record-high enrollment count with 91,003 sign-ups. The number was great news for the state, which posted annual increases even as enrollment declined in other states.
This changed in 2019.
That year, Nevada saw enrollment drop to 83,647. Korbulic attributed it to the constant erosion of the Affordable Care Act in the last three years.
One especially big factor is the repeal of the individual mandate, according to Korbulic. To keep premium costs lower, the mandate required people to carry insurance or otherwise pay a tax penalty. This was seen as a key part of the ACA to ensure that it had enough healthy people to balance out the less healthy enrollees.
Then there’s the chilling effect from the constant legal challenges to the ACA as well as misconceptions about its plans, Korbulic said This included talk that being on the exchange would make someone a public charge, which is not true. Becoming a public charge typically makes a person ineligible to successfully apply for legal permanent residence, which dissuaded many immigrants from signing up for an exchange plan.
Moves by the Trump Administration to cut funding and support for the ACA, also known as Obamacare, were another factor. Repealing the health care law has always been a top priority for the administration and it showed in its efforts to pare down federal support for the program.
“They cut enrollment down from 90 days to 45 days, they cut the marketing budget by 90%, they closed the navigator grants,” Korbulic said. “We wouldn’t have to be on defense so much if there was more administrative support.”
More competition
Health exchange plans are also seeing more competition after the Trump Administration introduced rules that encouraged alternatives such as association health plans or AHPs as well as short-term, limited-duration health insurance plans.
Association health plans were especially welcomed by business groups, who described them as game changers and started offering their own plans to their members. At the same time, AHPs also raised concerns about their potential for fraud. This was based on AHPs’ checkered past, which included instances of mismanagement, bankruptcy and unpaid medical obligations.
Short-term, limited-duration plans, meanwhile, also raised concerns. These include people signing up for them due to their lower cost without realizing that they offered fewer benefits. Unlike ACA plans, for example, short-term plans can deny coverage or charge higher premiums for pre-existing conditions. Some also have misleading language that makes their payouts sound much bigger than they actually are.
Mike Dillon, CEO of Dillon Health and a health care employee benefits adviser, says short-term health plans have a role in the marketplace. One is providing catastrophic health coverage for people in a short time period.
“You can have people who lose coverage in the middle of the month and might not be able to get coverage on the exchange,” Dillon said. “With a short-term coverage plan, brokers can buy you coverage within 24 hours.”
At the same time, they are not for everyone. If someone has pre-existing conditions and needs a lot of health services, a short-term limited duration plan would not be ideal, Dillon said.
The key with any insurance is to make sure that you know what you’re signing up for, according to Dillon. This means asking your broker the right questions about a plan’s premiums, deductibles and coverage. It’s also important to make sure you pick a trustworthy broker who won’t sell you a bad product just to pocket a commission, he added.
“Make sure you’re talking to a broker who’s licensed and in good standing with groups like the National Association of Health Underwriters,” Dillon said.
“There are bad actors in every industry out there so you’ve got to be aware of who you’re talking to. A good broker should be driving those questions about whether you have pre-existing conditions or have been hospitalized in the last six months.”
Silver lining
Even with the constant challenges faced by health exchanges, there are some notable silver linings as well.
One is Anthem’s return to Nevada’s exchange marketplace. This brings the total number of providers in Nevada back to three — the other two being United Healthcare’s Health Plan of Nevada and Centene’s Silver Summit.
Anthem’s departure in 2017 was a big deal, particularly in rural Nevada. When Anthem pulled out, there was a concern about the state ending up with “bare counties” where residents don’t have access to insurance on the exchange. Provider Health Plan of Nevada, for example, only offered ACA plans in Washoe, Clark and Nye counties. At the time, about 6,500 rural residents were at risk of losing their insurance in the state from Anthem’s departure. The problem was averted after Centene stepped in to offer plans for rural areas.
Anthem’s return brings even more stability to the exchange marketplace, Korbulic said. It also helps with pricing. The proposed rate increases for exchange plans during this enrollment period is only half of a percentage point, according to Korbulic.
After seeing a decrease in enrollees last year, there’s also an opportunity now to expand participation in the program. Nevada is the sixth-most uninsured state in the nation, according to a report by the Gunn Center. Of Nevada’s 400,000 uninsured residents, about 100,000 are eligible for Medicaid while another 100,000 are eligible for subsidies on the exchange.
Korbulic, however, says given the challenges that the program constantly faces, she will be happy with retention. At the same time, the fact that the program has not crumbled in the face of those challenges shows that it fills an important need, she added.
“We have lost of cost-sharing reductions, then lost the individual mandate and just had this paper cut after paper cut of the ACA,” Korbulic said. “Every time, the exchange comes through, which speaks to the fact that people need insurance and appreciate this kind of comprehensive insurance.”