Transforming Health Care Through Evidence and Collaboration
Transforming Health Care Through Evidence and Collaboration
The NIHCM Foundation is a nonprofit, nonpartisan organization dedicated to improving the effectiveness, efficiency and quality of America's health care system.
  • Data Insights

    This new Data Insights highlights the rapid rise in overdose deaths involving cocaine and methamphetamine, illustrates the geographic variations in utilization and death rates, and quantifies the increasing burden that these drugs are placing on the hospital system.

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  • Data Insights

    This infographic delves into an emerging public health emergency involving rapidly rising rates of stimulant use and related overdose deaths, which has been occurring in the shadow of the opioid crisis.

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  • Data Insights

    As Americans practice social distancing and quarantine, many are faced with new challenges accessing and affording food. This new Data Insights explores the impact of COVID-19 on food insecurity as well as how to identify those at risk and connect them with resources.

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  • News

    NIHCM would like to provide you and your organizations with a list of resources concerning COVID-19 and vulnerable populations. We will continually update this list.

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  • News

    To help you find answers to questions concerning COVID-19, NIHCM is providing you with links to expert sources that are frequently updated. We will continually update this list.

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  • Awards

    We are honored to announce the finalists for the 26th Annual Health Care Research and Journalism Awards. The winning entry in each category will be announced in late Spring and will receive a $15,000 to $20,000 cash prize.

    See the Finalists Press Release The NIHCM Awards
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Events

June 18, 2020
Homelessness Webianr Graphic

This webinar will look at the state of homelessness in the US and provide strategies to improve outcomes for homeless individuals both in the short term and in the long term.

May 11, 2020
Food Insecurity Graphic

This webinar brought together experts to provide insights on the longstanding issues surrounding food insecurity in the United States, exacerbated by the COVID-19 pandemic.

In the News

What to Expect for 2015 ACA Premiums: An Actuary Opens the Black Box

John Bertko, FSA, Retired Senior Actuary, Center for Consumer Information and Insurance Oversight, CMS
John Bertko
John Bertko

The Affordable Care Act (ACA) greatly changed how health insurers set premiums in the individual market starting in 2014. In spite of the uncertainty introduced by these changes, premiums for this year generally emerged better than expected, and CBO and JCT have lowered their estimate of average 2014 premiums in the exchanges by about 15 percent.1 Time will tell whether these premiums end up being too low, too high, or right on the mark for the population enrolled. While early enrollment snags in many exchanges fueled concerns about adverse selection and a possible spike in premiums for 2015, the late enrollment surge seems to have mitigated some of this concern.2

Well before the full 2014 experience is known, however, insurers must set their prices for 2015. Initial rate filings are already underway, and negotiations with regulators and exchange managers over the summer will determine final rates. In this essay, I describe the myriad factors that will be on the minds of health plan actuaries as they develop premiums, highlighting factors that will be more – or less – predictable and assessing their likely influence on future rates. This assessment is from a national perspective; individual state experiences will differ significantly based on whether they allowed insurers to extend non-ACA compliant policies beyond 2013 and their overall success in enrolling a large and balanced risk pool in exchange plans. Pricing updates also will vary across markets within a state and even within markets, depending on the characteristics of the local market and the insurers offering products.

Remember the Single Risk Pool

Under ACA rules an insurer must price for the individual market using a single risk pool that includes all of its enrollees in ACA-compliant policies, whether purchased on or off the exchange. Enrollees in catastrophic plans are excluded, as are those remaining in pre-2014 non-compliant products via grandfathering, early renewal or the extension of these products first permitted in November 2013. It is the exclusion of this latter group, largely expected to be better risks, that leads to concerns about worsening risk pools in states allowing such transitions. However, many off-exchange enrollees will be healthier people who were previously underwritten and “retained” by their insurer, offsetting some of the pressure for higher premiums based on exchange enrollment alone.

Knowable Factors

Some factors affecting insurers’ 2015 premiums can be projected with a fair amount of certainty. As always, actuaries will begin by using prior-period adjudicated claims to compute “trend” – that is, the rates at which cost per service, service use per enrollee, and intensity of service use have been changing for all of their privately insured enrollees. This factor will point to increasing premiums. They must then project this trend forward to the 2015 rating period by assessing whether utilization patterns of the 2014 enrollees differ from those underlying the trend (such as due to the new, very expensive drug for Hepatitis C) and developing expectations about whether the 2015 enrollees will look like the 2014 pool.

Insurers now assessing their 2014 enrollees will face data shortcomings but will not be completely in the dark. Many carriers will have claims for their pre-ACA enrollees who stayed with them in 2014 by moving into ACA-compliant products on or off the exchange. Actuaries at several insurers have told me they expect these enrollees to comprise up to three-quarters of their single risk pool – providing very significant insights for future pricing as well as a large share of enrollees expected to be healthier, on average. Similarly, insurers will know the risk profile of any enrollees continuing in their non-compliant plans and can estimate the impact of excluding them from the pricing pool.

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Events

June 18, 2020
Homelessness Webianr Graphic

This webinar will look at the state of homelessness in the US and provide strategies to improve outcomes for homeless individuals both in the short term and in the long term.

May 11, 2020
Food Insecurity Graphic

This webinar brought together experts to provide insights on the longstanding issues surrounding food insecurity in the United States, exacerbated by the COVID-19 pandemic.

In the News

Grants

Journalism GrantsJournalism Grant Program

The 2020-2021 round of grant making for this program will be underway shortly. Please stay tuned for more information.

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NYTUpshotLogo

Investigator-Initiated Research Grant Program

The 2020-2021 round of grant making for this program is now underway. Letters of Inquiry are due by June 29, 2020.

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Awards

The 26th Annual Research and Journalism Awards

Winners Announcment 2018 1

We are honored to announce the finalists for the 26th Annual Health Care Research and Journalism Awards.

Learn More