State-based health exchange: A concept with potential

Texas 2036 Senior Policy Advisor Charles Miller talked Thursday with members of the House Select Committee on Health Care Reform on legislation that would have the state take over operation of the health insurance marketplace currently run by the federal government.

Miller said that a state-based exchange contemplated by House Bill 700 “is a concept that has a lot of potential, and we look forward to working through the stakeholder process to get the best version of this bill going forward.”

He added, “At Texas 2036, we’ve conducted a lengthy project that we call, ‘Who are the uninsured?‘, and our goal here is simply to find out why is it that two million people are eligible but unenrolled. And those reasons are multiple.

But what we heard time and time again was frustrations with going through the enrollment process on the federal exchange as well as a lack of awareness of their eligibility for subsidies.

Overcoming resistance to the exchanges

Miller listed a few other reasons, such as:

  • Political opposition to signing up for what some perceived as Obamacare.
  • Branding issues with the federal exchange. People said they didn’t want that product because they perceived it as too expensive.
    • Miller added, “And no matter what information you gave them, they weren’t going to change their minds.”

He noted that the evidence showed that over 60% of the people who are signing up for coverage on the exchange are getting policies that are $10 a month or less, “whereas,” he said, “the perception is that these things are costing $300 a month or more.”

An opportunity exists therefore to change those perceptions with the state taking over operation of the exchange, Miller said.

Some of the more obvious avenues for improving public perceptions of the exchange could include:

  • Making sure that the website is easier to operate and that information is presented more clearly.
    • “You shouldn’t have to go through and enter in information for 45 minutes before you get a list of plans and what they might cost you,” Miller said. “That is driving people away.”
  • Stop spam calling people after visitors to the exchange sign up for service.
    • “The spam calls that they get after they submit their information is causing decision paralysis and causing them to not sign up as well,” Miller said.

What the state must do

The state must also have a clear mission and an objective if it wants to succeed at running a state-based health insurance marketplace, he added.

He suggested that those objectives could include:

  • making the enrollment process easier.
  • targeting outreach to people who are eligible but unenrolled.

“That’s not always the easiest thing,” Miller said. “And if we don’t tell them to do that, they may default to not doing it because those things are hard. And we see this with our state agencies that if we don’t give them specific direction, the default is paralysis.

He concluded, “Specifying those things out may be a way to thread the needle of not being overly prescriptive, but giving whatever entity it is that operates this exchange a mission and objective to reduce the number of people that are uninsured here in Texas.”

Read more from Charles: