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Public Health Insurance Choices Superior to Private Exchange options

Juliette Fairley

NEW YORK (MainStreet)—Public health exchanges may offer better health insurance online than Fortune 500 private exchanges under the Affordable Care Act, according to a new survey.

Also see: Affordable Care Act Rate Shock?

A HealthPocket study found that no plans awarded the highest five star rating by the government are offered to consumers through private exchanges; however, five-star plans are available through Medicare.gov in three of eight markets surveyed including Chicago, Dallas and New York.

"Our analysis shows that the private sector has some work to do to keep up with the government in offering a more complete picture," said Steve Zaleznick, executive director for Consumer Strategy and Development at HealthPocket.

Though gaps were found in government options, only 41% of Medicare Advantage plans and 49% of Medicare Part D plans were found in private exchanges compared to the federally-run medicare.gov. The private marketplaces provided 34% of the options offered by the government for individual and family plans (IFP) at healthcare.gov.

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"Given the increasing role of both private and government exchanges in health plan decisions, consumers need to be aware of what they are and are not seeing online," Zaleznick said.

People shopping in the individual health and Medicare markets obtain their coverage in a number of ways. They can buy their plan through these websites, via agents and brokers, or directly through the carriers.

Private exchanges are considered the online marketplaces of health insurance and related products, including web brokers. The discrepancy in what is available online is important for consumers to be aware of since by October 1, 2013, government-operated online health insurance marketplaces will be in place in every state.

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Uninsured Americans will be forced to pay a penalty of either $95 or 1% of their income, whichever is greater, beginning on January 1, 2014 but 64% of the uninsured have yet to decide if they will purchase health insurance by the deadline, according to InsuranceQuotes.com.

"A shocking number of Americans are still unsure how it will affect them," said Laura Adams, senior insurance analyst with InsuranceQuotes.com. "Uninformed consumers risk missing key deadlines."

One of the factors that may contribute to the neglect of quality in health insurance considerations is a lack of consumer awareness about publicly available information on health plan quality.

Also see: Millions Unaware They Are Eligible For the New Health Care Tax Credit

"Once premiums and benefits are more uniform and people can switch plans more easily, the entire marketplace will be competing on a more level field. People will also have access to information they have not had previously about how the plan really works. We expect that higher quality plans will dominate their markets over time," said Bruce Telkamp, CEO of HealthPocket.

Low-income households have the potential to benefit the most from health subsidies but those with annual income under $30,000 are the least likely to be aware of their eligibility, according to insurancequotes.com.

About 58% of Americans are not sure if they will be eligible for the tax credits that obamacare will offer to reduce the cost of health insurance.

--Written by Juliette Fairley for MainStreet

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