This article describes provider networks and benefit design-including deductibles, cost-sharing, and maximum out-of-pocket limits-for oncology care in 2015 health insurance exchanges.
Innovations in cancer treatment and health insurance markets present new opportunities for patients. Ad­vances in medical treatment today give more patients reason to hope for a cure and reduce some of the devastating ad­verse effects long associated with cancer therapy. However, such treatments can often be costly to insurers and to patients.
The Affordable Care Act (ACA) signifi­cantly broadened insurance coverage by ensuring that all individuals, even those with pre-existing diagnoses, can purchase insurance. The law also caps maximum out-of-pocket (MOOP) spend­ing for individuals at $6600, which offers important protection for cancer patients against high costs and possible medical bankruptcy. Meanwhile, insurers are responding to pressure from individu­als and employers to reduce monthly premiums. Each of these advances in healthcare coverage will benefit cancer patients. However, they also have re­quired changes to benefit designs that may impact patients.
In order to manage costs in the face of more expensive therapies and new cov­erage and benefit requirements, health plans have revised their insurance products to include narrower provider networks and increased cost sharing for some services and medications before consumers reach their MOOP spending. Exchange markets are leading the way in these innovations, although these benefit designs are likely to spill over into other sources of insurance—like the employer market.
This article reviews plan designs and network breadth for oncology patients who have exchange coverage. Success­ful exchange innovations that are pop­ular with consumers and effective at reducing premiums are likely to spread into other markets, including employ­er coverage. As such, it is important to understand these exchange benefit de­signs and what they will mean for can­cer patients.
THE AFFORDABLE CARE ACT
Along with the many changes it brought about in health insurance markets, the ACA also expanded access to patients who previously could not afford health­care or who were denied access due to pre-existing conditions. Since 2010, health plans subject to ACA require­ments have adjusted to operate un­der the new rules and regulations. The downstream effect of complying with the new regulations has been that plans have been more constrained in some ways—such as the amounts by which they can raise premiums and the scope of services they offer. However, that has given rise to innovation focused on net­work and benefit design.
The insurance exchanges created by the ACA also offer a new, centralized way for consumers to shop and com­pare health plans. Thus far, enrollees in these markets have been extremely price-sensitive—overwhelmingly choos­ing plans with lower premiums. Insur­ers that want to win enrollment have sought to keep premiums low by limit­ing provider networks and shifting more cost sharing onto enrollees, resulting in increased costs for some patients before they reach their MOOP limit. We have seen this dynamic unfold in several spe­cialties, including oncology.
ONCOLOGY BENEFITS IN EXCHANGE MARKETS
Exchange markets are leading the way in developing benefit designs that seek to contain costs. Access to oncology care through exchange plans will vary depending on the plan level purchased and the specific design of each product. On average, individuals with exchange coverage face higher levels of cost shar­ing for services and for medications compared with traditional commercial or Medicare markets. In 2014, almost two-thirds of enrollees selected silver tier plans, which are designed to cover an average of 70% of consumers’ health­care costs.1
Most exchange plans feature high deductibles that result in front-loaded costs in the benefit year. High deduct­ibles have been shown to have the effect of reducing spending, even for very sick patients.2 In 2015, silver tier plans had an average deductible of $2658, which usually includes prescription drugs. Pa­tients are responsible for 100% of appli­cable healthcare costs until the deduct­ible is fulfilled.
Once the deductible is met, patients will be responsible for cost sharing for drugs and services they receive before reaching the MOOP limit. For oncolo­gist visits, the average co-pay for a sil­ver plan in 2015 was $52 if the physi­cian was included in the plan’s network. However, if a patient seeks care from a non-network provider, he/she will be re­sponsible for the full cost of the visit un­less the exchange plan includes out-of-network coverage. Of the 40% of plans that offered out-of-network coverage for specialists in 2015, 49% was the average coinsurance for an out-of-network spe­cialist for plans offered through Health­care.gov.3
The diagnosis and monitoring of can­cer may also require patients to share in the costs for those services, such as CT and MRI scans. In 2015, imaging services had an average cost share of $234 or 27% in-network.
Most patients who have cancer receiv­ing active treatment will incur enough costs to reach their MOOP. Many plans sold in the higher gold and platinum tier feature reduced MOOP spending, which may reduce patients’ total costs despite having higher monthly premiums. In 2015, the average MOOP for platinum plans was $2145 compared with $6381 for bronze plans.4
COST SHARING FOR SERVICES AND DRUGS IN EXCHANGE MARKETS
Oncology patients may also find them­selves with high levels of cost sharing for their drugs in addition to access to their providers. As insurers look for ways to contain healthcare costs, utilization management (UM) of and cost sharing for prescription drugs has increased, especially as competition within thera­peutic classes—through new molecules being released to the market, existing products gaining approval for new indi­cations, and patents of pharmaceuticals and biologics expiring—has heightened the ability for payers to more tightly manage prescription drugs.
Plans are aggressively managing ac­cess to drugs through UM. Not only are rates of UM higher in exchanges than in employer plans, but the use of UM has been increasing in the market. Rates of UM for oncology medicines rose from 34% of drugs in 2015 to 50% in 2016.5
After meeting any UM requirements, patients in exchanges may also face high cost sharing for oncology drugs. An Avalere analysis of drug coverage in exchange plans found that coverage of oncology products within exchanges closely mimics trends seen in Medicare Part D, while employer plans tend to list these drugs on formulary and preferred tiers more frequently.5 In exchanges, 42% of oncology products are placed on the specialty tier compared with only 4% in employer plans ().
Specialty tiers disproportionately use coinsurance, often requiring pa­tients to pay a greater share of the cost of the drug than a flat dollar co-pay. As such, nearly half of oncology therapies are subject to coinsurance in exchange plans, averaging 37% of the cost of the drug.4 Although the majority of individu­als enrolling through the exchanges opt for silver tier plans, individuals with se­rious conditions, such as cancer, should consider choosing plans with richer benefits to reduce their out-of-pocket (OOP) costs and spread their expenses more evenly throughout the year.
ONCOLOGY NETWORKS IN EXCHANGE MARKETS
In addition to benefit design, provider networks can have a significant impact on consumer costs and access. The ACA sets minimum standards for network adequacy in exchange plans but leaves significant discretion to those plans. Insurers have leveraged provider net­works to reduce premiums by limiting participating providers to higher-value or lower-cost providers.
Because coverage for out-of-network providers is limited, cancer patients will benefit from ensuring their preferred physicians and hospitals are included in the network when choosing a plan. However, individuals given a recent diagnosis may find they have chosen plans with narrow provider networks and high cost sharing for out-of-net­work providers.
After evaluating how the oncology provider networks in exchange plans compare with networks in traditional commercial plans, an Avalere analy­sis of exchange plans found 42% fewer oncology providers in exchanges.4 This disparity in access to oncology provid­ers within exchange networks also varies by region: for example, in Char­lotte, North Carolina, and Jacksonville, Florida, exchange networks for oncol­ogy are 53% and 63%, respectively, the size of traditional networks in the same region.4 Individual plans within each region also vary by the breadth of their oncology networks ().
Furthermore, the results of a sur­vey conducted in partnership between Avalere and the National Comprehen­sive Cancer Network of 20 National Can­cer Institute—designated cancer centers revealed that some leading cancer cen­ters have been excluded from exchange networks:
These data demonstrate that access to oncologists and hospitals may be much more limited for exchange enroll­ees than for those in other markets. As such, it is critical that patients carefully examine the details of the plan prior to purchasing coverage.
THE FUTURE OF ONCOLOGY CARE FOR EXCHANGE PATIENTS
Going forward, oncology patients may have more tools to choose coverage that meets their needs, but some gaps could remain. For the 2016 plan year, issuers of exchange plans will be required to provide increased transparency for con­sumers in at least 3 ways:
The growth of decision support tools and consumer education can also help combat the tendency for patients to pick plans based on the premium alone. Some states have developed their own consumer support tools. California, for example, has developed an OOP calcu­lator and Idaho factors average “esti­mated expenses” associated with each plan. CMS has developed its own cost calculator, which include a provider and formulary search and estimates total OOP spending.
Beginning in 2016, the ACA will also require HHS to release an enrollee sat­isfaction survey to assess consumer experience with exchange plans.8 The information collected from the surveys will be publicly displayed to allow indi­viduals to compare satisfaction across plans. The survey will include questions on access to specialists and cost sharing for medications.
As we enter 2016, patients with cancer who are enrolling in coverage through the exchanges need to recog­nize the unique characteristics of this market that may impact their access to services and the costs associated with treatment. Careful selection of a health plan can help consumers anticipate and minimize their OOP costs.
Caroline F. Pearson is senior vice president at Avalere Health, an Inovalon Company.
Deirdre B. Parsons, MPP, MPH, MS, is senior manager at Avalere Health, an Inovalon Company.
1350 Connecticut NW, Suite 900
Washington, DC 20036
*This work was self-funded by Avalere Health.
1. Health Insurance Marketplaces 2015 open enrollment period: March enrollment report. HHS website. http://aspe.hhs.gov/sites/default/files/pdf/83656/ib_2015mar_enrollment.pdf. Published March 10, 2015. Accessed November 4, 2015.
2. Brot-Goldberg ZC, Chandra A, Handel BR, Kolstad JT. What does a deductible do? The impact of cost-sharing on health care prices, quantities, and spending dynamics. National Bureau of Economic Research website. http://www.nber.org/papers/w21632. Published October 2015. Accessed November 3, 2015.
3. Center for Consumer Information & Insurance Oversight. Health insurance marketplace public use files (Marketplace PUF). CMS website. https://www.cms.gov/CCIIO/Resources/Data-Resources/marketplace-puf.html. Accessed November 3, 2015.
4. Avalere Health analysis of 2015 exchange network designs using its proprietary PlanScape database. Avalere analyzed exchange and commercial plan networks in the largest cities in the 5 states with the largest 2015 exchange enrollment (FL, CA, TX, GA, and NC) using data provided by Strenuus (proprietary information).
5. Avalere Health analysis of 2015 exchange formularies using the PlanScape database. Avalere analyzed formularies for silver plans participating in 8 states (CA, FL, GA, IL, NY, NC, PA, and TX) using data from Managed Markets Insight & Technology, LLC and the 2015 HHS Individual Market Landscape File. Oncology classes included are antiangiogenic agents, antimetabolites, emetogenic therapy adjuncts, and molecular target inhibitors. This analysis is based on data collected by Managed Markets Insight & Technology, LLC (proprietary information).
6. Pearson CF, Choe SH. Leading cancer centers may be more widely included in exchange networks than expected. Avalere Health website. http://avalere.com/expertise/life-sciences/insights/leading-cancer-centers-may-be-more-widely-included-in-exchange-networks-tha. Published April 22, 2015. Accessed October 21, 2015.
7. Final HHS Notice of Benefit & Payment Parameters for 2016. CMS website. https://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/2016-PN-Fact-Sheet-final.pdf. Accessed November 3, 2015.
8. Section 1311(c)(4) of the Affordable Care Act. US Government Publishing Office website. http://www.gpo.gov/fdsys/pkg/PLAW-111publ148/html/PLAW-111publ148.htm. Accessed November 3, 2015.