What Makes U.S. Health Insurance Exchanges So Complicated
By: Uwe E. Reindardt (NY Times) July 2013
Uwe E. Reinhardt is an economics professor at Princeton. He has some financial interests in the health care field.
There is much coverage and commentary on news Web sites about whether the health insurance exchanges called for in the Affordable Care Act will be ready by Oct. 1 for enrollment by individuals seeking health insurance in the nongroup market. Insurance bought there takes effect on Jan. 1. I sense that many of those commenting would like the exchanges to fail.
Why is setting up these exchanges so difficult? After all, they are not a novel invention. The eHealthInsurance.com Web site, for example, has since 1997 functioned as an electronic exchange for private health insurance products sold in the nongroup United States market.
That exchange and similar existing private exchanges, however, are not suitable models for the exchanges envisaged in the Affordable Care Act. They function merely as passive brokers for whatever policies private insurers under contract with them choose to list. It is up to consumers to pore over the fine print of any particular insurance contract listed on an exchange for a detailed description of coverage benefits, limitations and exclusions.
There have been many reports on how coverage gaps in the fine print of such policies can leave people who believe they have health insurance in serious financial distress once they fall ill. See, for example, an analysis by Consumer Reports.
