As the ACA market shifts, brokers in some states have moved significant numbers of individual clients into ACA-compliant small group coverage, when possible. (Photo: Getty)

Brokers offer their perspective on the impact of the latest Affordable Care Act policy changes in the report, “Views From the Market — Insurance Brokers' Perspectives on Changes to Individual Health Insurance,” posted on the Robert Wood Johnson Foundation blog by Georgetown University researchers.

Consumers buying plans on ACA exchanges had already been faced with increasingly limited plan choices, relatively narrow provider networks and rising unsubsidized premiums, but in the past year, policy decisions made by Congress and the Trump administration have “exacerbated trends,” according to the researchers.

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Such policy decisions include the repeal of the individual mandate penalty, cuts to ACA-related outreach funding and enrollment assistance, and the encouragement of alternative coverage options that are exempt from the ACA's consumer protections, such as short-term limited duration insurance and association health plans.

Brokers' compensation for selling ACA-compliant individual market health insurance has declined, leading brokers to reduce their participation in the market, according to the report.

“Brokers cited reduced or eliminated commissions and the amount of time it takes to help someone through the enrollment process, particularly those eligible for premium assistance,” the researchers write.

Healthy, higher-income consumers are being pushed out of the individual market, brokers told the researchers. The ACA appears to have spurred increased demand for coverage among those previously uninsured, but significant premium increases in the states within the study — combined with fewer plan options and limited provider networks — resulted in a decline in enrollment in ACA-compliant coverage among higher-income and healthier consumers.

Healthy consumers are considering less-expensive products with fewer benefits and less consumer protections over ACA-compliant individual market insurance, particularly short-term plans and health care sharing ministries.

“Short-term plans and HCSMs do not need to comply with the ACA's consumer protections, often exclude preexisting conditions and often do not cover benefits such as maternity, mental health services, or prescription drugs,” the researchers write.

Brokers also report interest in direct primary care arrangements and fixed indemnity plans. Brokers in some states have moved significant numbers of individual clients into ACA-compliant small group coverage, when possible. Small-group market plans in these states tend to have lower premiums and wider provider networks than ACA marketplace options. Some brokers are also interested in the potential growth of AHPs, and brokers in Iowa showed particular enthusiasm about the future Iowa Farm Bureau plan.

Most broker respondents operating in states within the study report receiving higher commissions for selling non-ACA-compliant coverage options, such as short-term plans, fixed indemnity plans, and HCSMs. Brokers also reported extensive efforts by HCSMs to offer trainings to educate them about their coverage model and direct-to-consumer marketing of HCSMs and short-term plans.

All the brokers in the study sell some alternative coverage options to people who are ineligible for subsidies and looking for less expensive coverage. Many brokers expect these markets will grow, particularly for short-term plans and AHPs, in the wake of federal regulations designed to expand their sale.

“At the same time, the marketing of other alternative products to brokers, including health care sharing ministries and direct primary care arrangements, is increasing,” the researchers write. “Consequently, the individual health insurance market is expected to become smaller and sicker.”

Brokers also predict that premium rates will increase for ACA-compliant plans, pushing more healthy people into cheaper, less-comprehensive alternatives. The study focused on states with particularly fragile markets that had higher than average increases in premiums and a loss of insurers in recent years.

“But with the elimination of the individual mandate penalty and the expansion of alternative coverage options, many states that do not take steps to protect their ACA-compliant market could face similar instability,” the researchers write.