A Two-Step Procedure to Estimate Participation and Premiums in Multistate Health Plans

A Two-Step Procedure to Estimate Participation and Premiums in Multistate Health Plans

Amado Cordova
Carter C. Price
Evan Saltzman
Copyright Date: 2013
Published by: RAND Corporation
Pages: 56
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  • Book Info
    A Two-Step Procedure to Estimate Participation and Premiums in Multistate Health Plans
    Book Description:

    Multistate plans (MSPs) provide an attractive alternative among the health insurance plans established by the Affordable Care Act because they will have to be offered in multiple states. In this study, the authors’ objectives were to identify and characterize population groups that would likely be interested in enrolling in MSPs and to develop a methodology to project participation and estimate premiums for these plans.

    eISBN: 978-0-8330-8289-3
    Subjects: Health Sciences, Business

Table of Contents

  1. Front Matter
    (pp. i-ii)
  2. Preface
    (pp. iii-iii)
  3. Abstract
    (pp. iv-iv)
  4. Table of Contents
    (pp. v-v)
  5. Figures
    (pp. vi-vi)
  6. Summary
    (pp. vii-ix)
  7. Acknowledgments
    (pp. x-x)
  8. Abbreviations
    (pp. xi-xii)
  9. 1. Introduction
    (pp. 1-6)

    The Patient Protection and Affordable Care Act (PPACA) was signed into law by President Barack Obama on March 23, 2010. One week later, the President signed the Health Care and Education Reconciliation Act of 2010. These two laws are collectively referred to as the Affordable Care Act (ACA).

    The ACA is the most comprehensive health legislation enacted in the United States since President Lyndon Johnson signed the Medicare bill on July 30, 1965. The ACA intends to substantially increase the number of individuals covered by health insurance in the United States by expanding the Medicaid program, by requiring most U.S....

  10. 2. COMPARE and the Modeling of MSPs
    (pp. 7-14)

    In this chapter we first present an overview of the COMPARE microsimulation model (more detailed descriptions of COMPARE can be found in Cordova et al. [2013] and Eibner et al. [2011]) and a brief summary of the national-and state-level work we have done to estimate the consequences of the ACA. Then we explain the challenges we faced in modeling MSPs.

    COMPARE was developed by researchers at RAND to predict how firms and individuals would respond to health care policy changes, particularly the ACA. This section provides a brief overview of the COMPARE microsimulation and highlights the aspects of the model...

  11. 3. Approach
    (pp. 15-22)

    In this chapter we explain the approach that we followed in the two phases of this study. First, we describe our methodology to identify the four main populations of interest. This comprised the work under Phase 1 of the project. Second, we explain the two-step procedure to estimate participation and premiums in MSPs. The latter was the work performed under Phase 2 of the contract.

    A key objective of this study was to identify individuals who are likely to participate in MSPs. To this end, the study team identified four groups of individuals who may be inclined to join an...

  12. 4. Results and Deliverables
    (pp. 23-36)

    In this section, we highlight the most pertinent results of the COMPARE baseline national-level microsimulations, primarily focusing on enrollment patterns in the regulated nongroup and regulated small-group markets. Furthermore, we compare enrollment for the three groups of individuals identified as likely candidates to join an MSP to national-level enrollment.

    In our analysis, we estimated that the U.S. population in 2016 would include approximately 2.2 million out-of-state students, 3.0 million interstate movers, and 5.0 million out-of-state workers. By comparison, the U.S. nonelderly population in 2016 is projected to be approximately 277 million. To build a strong foundation for interpreting the results,...

  13. 5. Conclusions
    (pp. 37-38)

    MSPs may be attractive alternatives for certain population groups, given that the law prescribes they must be offered in multiple states. In this study, we characterized the population groups that will likely have preference for enrollment in MSPs after enactment of the ACA. Their demographic characteristics are not surprising. Concerning age and income, out-of-state students tend to be between the ages of 19 to 29 and to belong to slightly higher-income households than the general population. Interstate movers also tend to be younger—confirming the idea that older individuals are more settled and less likely to migrate—but they tend...

  14. Appendix: Summary of the Mathematical Formalism to Calculate MSP Premiums
    (pp. 39-40)
  15. References
    (pp. 41-44)