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The American Journal of Managed Care December 2018
Feasibility of Expanded Emergency Department Screening for Behavioral Health Problems
Mamata Kene, MD, MPH; Christopher Miller Rosales, MS; Sabrina Wood, MS; Adina S. Rauchwerger, MPH; David R. Vinson, MD; and Stacy A. Sterling, DrPH, MSW
From the Editorial Board: Jonas de Souza, MD, MBA
Jonas de Souza, MD, MBA
Risk Adjusting Medicare Advantage Star Ratings for Socioeconomic Status
Margaret E. O’Kane, MHA, President, National Committee for Quality Assurance
Reducing Disparities Requires Multiple Strategies
Melony E. Sorbero, PhD, MS, MPH; Susan M. Paddock, PhD; and Cheryl L. Damberg, PhD
Cost Variation and Savings Opportunities in the Oncology Care Model
James Baumgardner, PhD; Ahva Shahabi, PhD; Christopher Zacker, RPh, PhD; and Darius Lakdawalla, PhD
Patient Attribution: Why the Method Matters
Rozalina G. McCoy, MD, MS; Kari S. Bunkers, MD; Priya Ramar, MPH; Sarah K. Meier, PhD; Lorelle L. Benetti, BA; Robert E. Nesse, MD; and James M. Naessens, ScD, MPH
Patient Experience During a Large Primary Care Practice Transformation Initiative
Kaylyn E. Swankoski, MA; Deborah N. Peikes, PhD, MPA; Nikkilyn Morrison, MPPA; John J. Holland, BS; Nancy Duda, PhD; Nancy A. Clusen, MS; Timothy J. Day, MSPH; and Randall S. Brown, PhD
Relationships Between Provider-Led Health Plans and Quality, Utilization, and Satisfaction
Natasha Parekh, MD, MS; Inmaculada Hernandez, PharmD, PhD; Thomas R. Radomski, MD, MS; and William H. Shrank, MD, MSHS
Primary Care Burnout and Populist Discontent
James O. Breen, MD
Adalimumab Persistence for Inflammatory Bowel Disease in Veteran and Insured Cohorts
Shail M. Govani, MD, MSc; Rachel Lipson, MSc; Mohamed Noureldin, MBBS, MSc; Wyndy Wiitala, PhD; Peter D.R. Higgins, MD, PhD, MSc; Sameer D. Saini, MD, MSc; Jacqueline A. Pugh, MD; Dawn I. Velligan, PhD; Ryan W. Stidham, MD, MSc; and Akbar K. Waljee, MD, MSc
The Value of Novel Immuno-Oncology Treatments
John A. Romley, PhD; Andrew Delgado, PharmD; Jinjoo Shim, MS; and Katharine Batt, MD
Medicare Advantage Control of Postacute Costs: Perspectives From Stakeholders
Emily A. Gadbois, PhD; Denise A. Tyler, PhD; Renee R. Shield, PhD; John P. McHugh, PhD; Ulrika Winblad, PhD; Amal Trivedi, MD; and Vincent Mor, PhD
Currently Reading
Provider-Owned Insurers in the Individual Market
David H. Howard, PhD; Brad Herring, PhD; John Graves, PhD; and Erin Trish, PhD

Provider-Owned Insurers in the Individual Market

David H. Howard, PhD; Brad Herring, PhD; John Graves, PhD; and Erin Trish, PhD
Provider-owned insurers sell individual policies in areas that cover 62% of the US population and have premiums similar to policies of traditional insurers.
RESULTS

Availability of Provider-Owned Insurance Plans

There were 149 insurers that sold ACA-compliant plans in 2017, of which 51 were provider owned based on our criteria. Provider-owned insurers operated in 208 of the 503 markets. Figure 1 displays the number of provider-owned insurers in each market. Provider-owned insurers operate in geographically diverse areas in the United States, including the upper Midwest, the coastal West, and the mid-Atlantic. Five providers (CHRISTUS Health, Covenant Health, Memorial Hermann, Prominence Health, and Baylor Scott & White Health) sell insurance in Texas, a state not normally associated with delivery system innovation.

Between 2016 and 2017, 4 provider-owned insurers exited the ACA-compliant market entirely, 5 entered (for a net gain of 1), and 46 participated throughout both years. In the same time frame, 9 traditional insurers exited, 3 entered (for a net loss of 6), and 95 participated throughout both years. The mean number of insurers (of both types) per rating area in the ACA-compliant market decreased from 6.1 in 2016 to 4.2 in 2017. In most markets in which provider-owned insurers sold plans, there were usually just 1 or 2 provider-owned insurers per market.

Figure 2 displays the change in the availability of plans sold by provider-owned and traditional insurers by population. The x-axis represents the number of carriers per market of each type operating in 2016, and the y-axis represents the number per market operating in 2017. For example, the large dot at the x = 1, y = 1 position in the “Provider-Owned Insurers” panel indicates that there are more than 50 million individuals who live in markets where exactly 1 provider-owned insurer sold plans in 2016 and 2017.

Large regions of the United States have no provider-owned insurers, but many states are sparsely populated. About 62% of US residents (more than 170 million people) live in a rating area in which a provider-owned insurer sells plans.

Six percent of the population live in areas in which the number of provider-owned insurers increased between 2016 and 2017 (represented by the lighter circles in Figure 2). Eleven percent of the population live in areas in which the number of provider-owned insurers decreased (the darker circles in Figure 2), and 51% live in areas in which the number of insurers stayed the same (the medium circles in Figure 2). The remaining 32% of the population live in areas in which no provider-owned plan was available in either 2016 or 2017.

One percent of the US population live in areas in which the number of traditional insurers increased, 56% live in areas in which the number of insurers decreased, and 43% live in areas in which the number of insurers stayed the same.

Table 1 summarizes market characteristics and shows the association between market characteristics and the presence of a provider-owned insurer in the 503 rating areas. Only per capita income was significantly associated with the presence of a provider-owned insurer in a market. An increase in income of 1 SD ($8700) is associated with a 14-percentage-point increase in the likelihood that there is a provider-owned insurer in a market.

Table 2 presents summary statistics at the insurer-market level for each insurer’s least expensive Silver plan in the markets in which they offer at least 1 plan. Provider-owned insurers sell 30% of the plans in the sample. Seventy-eight percent of plans were classified as health maintenance organizations or exclusive provider organizations. Thirty-five percent of all plans in the sample were available in the off-exchange market only.

Provider-owned insurers sold 1396 Silver plans in total, of which 156 (10%) were available off-exchange only. Traditional insurers that operated in the same markets as provider-owned plans sold 3868 plans in those markets, of which 502 (14%) were available in the off-exchange market only. On average, provider-owned insurers sell on-exchange plans in 80% of the markets in which they operate. Traditional insurers sell on-exchange plans in 90% of the markets in which they operate (considering only markets in which provider-owned insurers sell plans, to facilitate comparison).

Figure 3 shows estimates of differences in premiums between provider-owned and traditional insurers’ plans from 6 mixed-effects logistic regression models estimated on the sample described in Table 2 (n = 970). Full estimates are presented in eAppendix Table 2. The first model includes a random effect for market but not insurer. The second, our preferred specification, adds a random effect for insurer (insurers sell multiple plans across markets). The model indicates that premiums for plans sold by provider-owned insurers are lower, on average, but not statistically different from premiums for plans sold by traditional insurers.

The third model includes plans sold by multistate insurers (n = 533), and the fourth includes plans sold by all insurers other than Kaiser Permanente (n = 923). The fifth and sixth add controls for plan type and the cost-sharing parameters described in Table 2. There are 190 variables in the HIX Compare data that describe different plans’ cost-sharing requirements. We did not control for these in the baseline model because benefit levels in the exchange are tightly regulated. Silver plans must have an actuarial value of at least 70%. A plan that requires lower cost sharing along one dimension will have higher cost-sharing in another. We nevertheless estimated a model in which we control for several especially salient cost-sharing parameters, such as whether the plan has a deductible for in-network care, the size of the in-network deductible, and the maximum out-of-pocket payment for in-network care.6,13

The results are consistent across models: Point estimates are negative (indicating that provider-owned plans have lower premiums), and the CIs are wide. Results are similar when we re-estimate the model on plans in different metal tiers (Bronze and Gold), using premiums for different policy holder types (individuals aged 27 years and couples both aged 30 years), and on plans sold in the exchange market only.

When we re-estimate the second model (our preferred specification with market- and insurer-level random effects) using 2016 data, the coefficient on provider-owned plans is –15 (95% CI, –39 to 9). Premiums for provider-owned plans were lower but not statistically different from premiums for plans sold by traditional insurers. If we omit carrier-level random effects, the coefficient is –18 (95% CI, –28 to –8).


 
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