The new estimates were revealed this week in a report, "Change the Channel: Health Insurance Exchanges Expand Choice and Competition," which relied on two nationwide surveys, commissioned by PwC, of 1,000 consumers and 153 health insurance executives about their expectations around health insurance exchanges.
Under the Patient Protection and Affordable Care Act, states are required to establish fully operational health insurance exchanges by January 2014. The exchanges are online marketplaces that seek to inject competition into the health insurance marketplace by making it easier for individuals and small businesses to compare health plans' price and coverage options. Additionally, consumers can get answers to questions, find out if they are eligible for tax credits for private insurance or health programs like the Children's Health Insurance Program (CHIP), and enroll in a health plan that meets their needs.
Just this week, the Obama administration issued two notices of proposed rulemaking that further clarify how these exchanges will operate and gives states greater flexibility as they design exchanges that best fit the needs of their residents and respond to local market conditions.
The online exchanges will require a technology infrastructure that supports websites where health insurance data and state and federal government information will be posted. These exchanges will also accommodate the millions of online users who will log onto the system to look for health insurance coverage. According to PwC, in 2014 an estimated 12 million consumers will choose health insurers in a new, tightly regulated marketplace, and by 2019, an estimated 28 million Americans will buy health insurance through this new online channel.
The consensus is that much work needs to be done to ensure that consumers can start using the exchanges on Jan. 1, 2014. The government has said consumers could start enrolling in the second half of 2013 for coverage that begins in 2014. Insurers said the most critical tasks that lie ahead are market analysis, strategy completion, product development (including regulatory approval), and technology integration with the exchanges.
The PwC survey also found that technology integration, such as payment or enrollment transactions, is a top concern for insurers. The report states that the top two reasons some insurers don't plan to participate in health insurance exchanges are problems integrating technology (e.g., payment transactions) with the exchanges (34%) and concerns about the ability to charge enough to make a profit (23%).