Sophos, the renowned security firm, recently reported in its survey of data encryption: “The Sophos survey of IT decision makers in six countries reveals that there are some misconceptions about encryption, and some disconnects between what companies say they are concerned about – and what they’re doing about it.”

The article does not talk about misconceptions, but should!  Probably the biggest misconception is that your data is safe from hackers when you adopt an encryption technology.

In further analysis of the Sophos survey for Healthcare firms, Sara Heath writes:

Those organizations that do not encrypt their data – and even some that do – are seeing some gaps in data protection. Nearly one-quarter of customer information and customer financial information falls through the encryption cracks, leaving it liable to a data breach.

This is especially alarming when put into the context of the healthcare industry. Because patients are the customers in the healthcare industry, it is important that all of their PHI be fully protected via encryption to keep that valuable information from falling into malicious hands.

While encryption is great and everybody seems to be advocating it, does it really thwart a determined hacker?

Malicious hackers routinely steal information from private databases. It is a widespread fallacy that by encrypting the data in these databases, data will be safe. Regulators, compliance authorities and industry standards insist on encrypting sensitive information such as SSNs, credit card numbers, and health information.



However, unless the encryption is one-way – once encrypted, the data can no longer be recovered – encrypted data used by database-backed websites is usually as insecure as unencrypted data.

The encrypted data, to be usable, is obviously decrypted by some applications and processes within the system or on the network. Those applications and processes need to access the sensitive data, usually quite frequently, and have access to the decryption keys. The decryption keys are made available to these applications either by trusting their user-id, or their process filename, the computer’s IP address, or a similar factor.

To understand why data encryption might provide a false sense of comfort, let us make some rather formidable assumptions against our adversary, the hacker.

Let us assume that:
(a) the application logs are encrypted
(b) the application is encrypting its “heap” memory
(c) the application is enforcing data privacy in its interfaces to other components
(d) the decryption keys are stored in an ultra-secure (digital) vault

These assumptions are very hard to implement correctly. But let’s assume that they are true.

The fact that a hacker is able to access data, even if in encrypted form, in a database clearly indicates that the hacker has breached the various security perimeters and gained unauthorized access to an internal system. In normal course, the hacker should have not been able to access the raw database at all. Once the hacker is inside the network and has been able to access the database, it is a fair assumption that the hacker is able to assume the identity of the application or the web-server itself. In fact, once inside a system, it is not that hard for a hacker to just try and become the superuser of that system and then masquerade as a specific user.

Once that happens, all bets are off. If the hacker’s access to the database cannot be distinguished from the application’s access, encryption does not help at all. Once a hacker is inside your network and is able to access your encrypted data, it is usually only a matter of time before he figures out how to access the required keys, and then to decrypt the data.

Bruce Schneier, the famous crypto-expert, highlighted this way back in a blog article from 2010:

Let’s take a concrete example: credit card databases associated with websites. Those databases are not encrypted because it doesn’t make any sense. The whole point of storing credit card numbers on a website is so it’s accessible — so each time I buy something, I don’t have to type it in again. The website needs to dynamically query the database and retrieve the numbers, millions of times a day. If the database were encrypted, the website would need the key. But if the key were on the same network as the data, what would be the point of encrypting it? Access to the website equals access to the database in either case. Security is achieved by good access control on the website and database, not by encrypting the data.

We re-iterate the last sentence: Security is achieved by good access control on the website and database, not by encrypting the data.

To be sure, encryption is useful for carrying around sensitive information. But for data “at rest”, mere encryption offers but an illusion of safety.

As the third open enrollment period comes to a close, I’m reflecting back on the 2016 season and what did and did not work well for brokers.

One component of the enrollment process that really stood apart for me was the ability to seamlessly connect to HealthCare.gov (FFM) for quick and easy subsidy qualifications and enrollments.  Web Broker Entities refer to this process as the “Double Redirect” and is required by CMS for enrolling individuals online, regardless if they choose to self-service or leverage a broker’s assistance. As a licensed broker employed by hCentive that works on Federal and State Exchanges regularly, I can’t stress enough the importance of having online broker benefits tools that are CMS compliant. If your online enrollment platform provider is not CMS compliant, you’re putting your book of business at risk with sudden changes in the way clients enroll, or worse, not being able to conduct business.

Brokers are required to participate in annual training with CMS if they wish to sell on HeathCare.gov. During your training and/or certification process CMS clearly states there are two ways for a broker to enroll an individual:

  1. a broker may assist a client directly while they log into HealthCare.gov with their individual account, or
  2. by logging into HeathCare.gov as a broker, using a Web Broker Entity’s (WBE) direct enrollment process.
    [WBE Process]: When working with a client using a WBE, an agent or broker is securely redirected from the QHP issuer’s or Web Broker’s website to HealthCare.gov.  Once the broker is on HealthCare.gov they can complete the eligibility application with the consumer, using the agent or broker’s HealthCare.gov user ID. After the application is completed on HealthCare.gov, the agent returns to complete the enrollment on the Web Broker Entity’s site.

See: Resources for Agents and Brokers in the Health Insurance Marketplace

Reflecting on the above, is number one or number two consistent with what you, the broker, have been doing during the last few months of OEP? Or did you have to modify the way you were helping your clients due to a change in the way your current technology platform was working? If number one and/or number two above follows your process, then your technology partner has been conscious of their product design and eliminated any compliance risk for you and your clients.

For more information on working with a technology partner that offers brokers a CMS compliant platform to manage group and individual business, end-to-end management of quoting, enrollment, and administration and more.

These days everyone looks to technology, particularly apps, for consumer information and purchasing. Considering this and the exploding technology space for HR and benefits enrollment technology, I’m asking—can technology replace the role of the health insurance broker in assisting individuals and employer groups with their insurance purchasing decisions? In an Employee Benefits News article Ray Mara, SVP of Group Products at Guardian says “Employers rely on their benefit brokers not only to advise them on plan offerings and design, but increasingly on the service administration of those programs.” Keeping this in mind, let’s do a quick review on the value of using a broker to make insurance and benefit purchasing decisions:

  • Tailored Recommendations – Brokers work with their clients to make specific recommendations tailored to meet the client’s needs. For an individual client, they will discuss budget, goals, ACA requirements (potential subsidies available), and any specific family needs. For an employer client, they will review the organizational culture, approach to benefits, budget, compliance requirements, etc. Coupled with their industry knowledge they are well positioned to make a best-fit recommendation.
  • Market Intelligence – A broker understands their geographic market and the insurance carrier offerings. They can sit with their clients (or instruct them online) on comparing carriers, coverage details, and costs. They can easily point out the differences, identify problematic or beneficial areas, and help their clients analyze these differences, leading to stronger recommendations.
  • Relevancy – A broker with an existing client relationship has the ability to periodically review plan designs and cost to ensure their recommendations remain relevant to their clients’ situation.
  • Client Advocate – When a broker has relationships with their clients, they become a natural advocate for when issues may arise with insurance companies.
  • Enrollment Support – Additionally, for employer clients, the broker can take an active role in communicating benefits to employees and supporting the employees during Open Enrollment or throughout the year.

Considering the above, do we actually believe it’s possible for technology to replace the broker relationship? I think not.



Health insurance plans, and other insurance-related products are complex and it is ever increasingly important to make the right choices. Sure, decision support tools can be built into technology platforms to assist with filtering a multitude of plans for a consumer to choose. However, the personal relationship with a broker and their knowledge of carrier products and the marketplace cannot be replaced.

Ideally we’d like to see technology products that promote a partnership with brokers. In a technology-supported partnership, the broker and their clients benefit from the efficiencies of an online insurance marketplace and enrollment system. Imagine having the expertise of a seasoned insurance broker aligned with a single technology platform that allows brokers and their clients to view plans, make choices, enroll, and review on an on-going basis. Brokers are here to stay and the technology to support them, and their clients, will continue to grow as an important part of the consumer purchasing process.

Relevancy, value addition, and guidance – these are keywords being used in the evolving broker market at existing broker businesses. The role of brokers is changing due to the onset of a benefits marketplace approach in individual as well as employer business. At hCentive, we have been at the helm of the change rocking the broker market, and we have been participating in discussions with our broker clients, and this is what we have arrived at.

Die Out or Mutate, but Decide Soon

Out of our roundtable discussion at our past hCentive xChange Customer Conference, this was the prime sentiment echoing across our participating broker clients – brokers are in a dire need to evolve with the market or face extinction. With the new benefits marketplace exchange strategy making inroads, the traditional role of brokers is losing its charm and brokers need to evolve with the role to present better value to customers.
To compound the challenge, brokers need to adapt to the market’s speed, and that means adjusting with market change velocity. Die out or mutate, but take a quick decision to stay competitive in the market.

Right Engagement is Key to Retention

On the engagement front, brokers have made strong headway, but almost all our clients agreed that things could be improved here. Currently, the majority of a broker’s focus is on engagement, but only a few brokers are doing things right. The focus needs to move away from regular, low-value stuff, such as sending birthday cards, to high-value engagement, such as guiding customers with knowledge about their insurance health plans and shopping over marketplaces. Brokers need to realign their automated engagement touch points to present value to their audience.
At the same time, brokers need to strategize their automated touch points in a way that they are not the default authority whenever their clients have questions or issues. The strategy needs to be a combination of self-service and engagement during enrollment and renewal processes.



Leverage Knowledge and Exchange Familiarity

With exchanges and carriers, brokers have an advantage that is unprecedented – their knowledge base and exchange familiarity. From this standpoint, brokers will have a continued, renewed role to play, given that they sustain their knowledge and deliver it through all their engagement channels.
In this task, exchange familiarity will give them another advantage, and all of this will ultimately come together for their benefits marketplace strategy.

Rely on Multiple Product Lines for Continued Payout

With exchanges running the show, brokers cannot distinguish against their competition through offerings or price. The exchanges have taken over that role, and brokers need to up their game for continued payout from the market. Combining their knowledge vantage point with multiple product lines, brokers can arrive at a solid strategy that lets them establish new value in the evolved market without sacrificing too much of their commission. In short, if you want to continue being competitive in the market, you need to rely on multiple product channels and use your vantage point for lasting growth in the market.

About 6 million members enrolled in their benefits on a private health insurance exchange for the 2015 plan year, continuing an adoption trend with more than 100 percent annual growth since 2013. The mid-size employer segment of 100 to 2,500 employees is driving initial growth, which is projected to double again in 2016 to 12 million employees (source: Accenture analysis). The promise of choice, cost savings and customer experience dominate the trend-lines on private exchanges but innovation really holds the key to sustained adoption and growth.

Fidelity Investments® today announced the launch of Fidelity Health MarketplaceSM, which offers one-stop access to integrated health, wellness and financial benefits to small and midsized businesses and their employees (source: Fidelity press release). Fidelity Health Marketplace offers employers the ability to choose from an extensive network of national and regional medical, dental, vision, and life benefits in addition to tax-savings options and access to wellness tools and programs. The Marketplace uses hCentive’s WebInsure™ Benefits private exchange technology platform, which offers an integrated enrollment experience and pre-configured connections to a network of insurance carriers and a range of health and other ancillary benefits.

Integrating financial solutions with health and wellness offerings through a private exchange delivers a real “health & wealth” proposition. More importantly, it exemplifies continuous product innovation and expansion with both insurance and non-insurance products to meet the unique and specific needs of employers and employees. For example, hCentive recently added a socially responsible credit program that offers low-cost employee loans with 0% financing. Previously, employees would not have had access to such a program with payroll deductions, but our private exchange solution easily allows them to bundle the product if they need to manage high or sudden medical costs.

Innovation, coupled with digital footprint, branded storefront and sophisticated decision support tools for employees will bolster brokerages and financial services firms’ ability to differentiate from established competitors and emerging tech upstarts; provide employees with intuitive user interface and experience to shop, select and enroll in benefits; and, simplify and standardize onboarding of carriers and benefits products. That is what will really drive demand for private exchange solutions from employers in 2016 and beyond. Tell us what you think.

Experience the new Fidelity Health Marketplace at https://www.fidelityhealthmarketplace.com/.

Learn about hCentive’s WebInsure Benefits platform at https://www.hcentive.com/products/benefits/. Contact us to see what hCentive can do for you!

The federal government became states’ technology vendor when it enticed four states to use HealthCare.gov by initially offering it for free, while underpricing HealthCare.gov compared to its actual costs for another 34 states.

Four states including Oregon and Nevada tried to stand up their own health insurance exchanges, hiring technology vendors that pushed for expensive custom builds with no proven track record for success. When those vendors failed to deliver functional exchange technology, the four states ditched their faulty software and began using HealthCare.gov – which at the time was offered to them free of charge. By offering HealthCare.gov to those states as a replacement technology solution, the federal government effectively became their technology vendor – enticing states to join with a two-year free trial period.

As the four states used HealthCare.gov at no cost, another 34 states paid federal technology use fees that were intentionally underpriced compared to HealthCare.gov’s actual costs. The federal government intends to continue underpricing HealthCare.gov in these 34 states through December 2017 – even though the Affordable Care Act required all exchanges to be self-sustaining by January 2015. As long as HealthCare.gov continues to be underpricing its services compared to their actual costs, states can’t benefit from private sector vendors who can compete favorably with HealthCare.gov to provide states better functionality and a pricing structure that encourages enrollment success. But this situation is changing in four states.

States faced with HealthCare.gov’s actual costs are given a fair opportunity to consider financially sustainable alternatives for their state marketplaces.

In November 2015, the federal government announced that HealthCare.gov intends to charge new federal technology use fees in Oregon, Nevada, New Mexico and Hawaii that are “reflective of [HealthCare.gov’s] actual costs.” Faced with the full costs of using the federal exchange, Oregon began a procurement for a more affordable state marketplace solution. Nevada is in the same situation and is considering a plan to replace HealthCare.gov with a proven technology vendor whose pricing structure is aligned with enrollments rather than health plan premiums.

Faced with HealthCare.gov’s actual costs, Oregon, Nevada and New Mexico reacted in similar ways by asking for a phase-in of the new federal technology fees and a fairer method for determining fees owed to allow for financial stability for the marketplace and carriers. Nevada asked that HealthCare.gov – because it is now collecting vendor fees – act more like a private technology company than a government agency. Nevada rightly expects HealthCare.gov to partner with states to ensure marketplaces have accurate and up-to-date enrollment information, and that it serve as a single source of truth for all of the marketplace’s health plan enrollments.


Everybody wins when HealthCare.gov is priced for all states at its full and accurate cost.

While the four states facing HealthCare.gov’s actual costs prepare to pay the new technology fees or avoid them by switching vendors, the outcome for the remaining 34 HealthCare.gov states is less certain. HealthCare.gov continues underpricing its technology fees in those states, and they can’t be certain how long this will continue under the next administration. Taking action now will allow all states to ensure their citizens can access affordable health coverage for years to come. Because HealthCare.gov must obtain permission from the White House’s budget office each year it wants to continue underpricing for its services in those 34 states, a new administration may be less amenable to continuing the budget shortfalls associated with HealthCare.gov – which amount to $621 million in 2016 alone.

The state exchange market has matured since those technology vendors failed to deliver functional and sustainable technology in Oregon, Nevada, New Mexico and Hawaii. Private sector alternatives to HealthCare.gov are available and can be a significant cost benefit to states. Moreover, these private vendors can work with a state to configure the exchange in ways that increase enrollments by recognizing that states each have unique needs and programs.

Now that Commercial-off-the-Shelf (COTS) products support the exchanges that are operating smoothly and effectively in states including Massachusetts and Arkansas, states should be allowed to benefit from private sector vendors such as hCentive competing with HealthCare.gov on a level playing field – in every state. Tell us what you think.

Read hCentive’s comments on the federal government’s plans to continue undercharging for HealthCare.gov in 34 states.

Open enrollment for 2016 health coverage has begun, and people across New Mexico, Nevada, Oregon, Hawaii and other states are using HealthCare.gov to search for quality health coverage that they can afford. Already impacted by average rate increases of 11.4% in Nevada, 24% in Oregon, and 30% in Hawaii, HealthCare.gov is proposing to add a new user fee of 3% on top of existing premiums for these states.

Vendors failed to deliver, and four affected states used HealthCare.gov for free.

User fees charged on top of health plan premiums were expected to allow state marketplaces to be financially sustainable without additional federal support. But the original technology vendors in states like Oregon, Nevada and Hawaii never delivered functional exchange technology – and hundreds of millions in federal taxpayer dollars later, those states moved from their failed technology to using the HealthCare.gov platform – free of charge.

This new set of HealthCare.gov fees is likely just the beginning of new federal technology fees for states using HealthCare.gov – placing affordable plan premiums continually at risk.

HealthCare.gov user fees will need to be increased further because for the last three years, the federal government has been undercharging or not charging states at all for the costs of HealthCare.gov. Federal policy and a recent Supreme Court ruling confirm that Congress directed HealthCare.gov to be financially self-sustaining, just like state marketplaces. But the federal government has never made HealthCare.gov self-sustaining and in 2014, 2015, and 2016 has taken funding from other programs to recover its over $600 million deficit incurred from running HealthCare.gov at a loss. The only direction HealthCare.gov user fees and plan premiums can go is up.

New proposal for technology use fees in Nevada, Oregon, New Mexico and Hawaii.

Last month, hCentive sent warning letters to Insurance Commissioners in HealthCare.gov states alerting them that the federal government has declared that current fees charged to carriers do not fully support the costs of running the multibillion dollar federal healthcare exchange. Days later, the federal government announced it intends to levy hundreds of millions of dollars in new HealthCare.gov technology use fees on Oregon, Nevada, New Mexico and Hawaii – fees that could harm these states’ marketplaces. The proposed new fee – 3% of premiums – is on top of existing fees states need for local marketplace operations and will hamper states’ ability to ensure state specific rules and policies are enforced, and local community needs are met.

Looking to the private sector for HealthCare.gov alternatives that are better suited to states’ needs.

Given these new federal rules and responsibilities for states using HealthCare.gov, it should come as no surprise that states are realizing HealthCare.gov is going to continue to increase in price, was not built with states’ unique needs in mind, and therefore, many states are actively exploring other options. They are right to do so.

Technology firms like hCentive – with its State Exchange Lease offering – are well positioned to offer financially sustainable solutions to states as they consider alternatives to HealthCare.gov. Tell us what you think.

Josh Schultz (josh.schultz@hcentive.com) is the Senior Analyst for Government Solutions at hCentive. In this capacity, Josh coordinates all public policy and regulatory initiatives affecting hCentive’s public sector business and works to identify new avenues for states to benefit from hCentive’s financially sustainable state exchange technology. Before hCentive, Josh managed contracts with the New York State of Health Marketplace’s navigator and assister programs.
Michael Sasko (michael.sasko@hcentive.com) is the Vice President of Government Solutions and Commercial Products at hCentive. Mike brings extensive health insurance exchange experience having served in leadership roles on major government projects to include Covered California and the Federal Small Business Options Program (SHOP). On the commercial side, Mike brings a strong employer focus having served as a former Director of Strategy and Innovation and as a currently licensed agent/broker.

 

King v. Burwell, the case that is causing sleepless nights to Obama administration, Health Plans, and Consumers with Obamacare subsidies, may have yet another implication that could skew premium increases across the nation for everyone. No matter which way the Supreme Court ruling goes, the health insurance premiums are set to rise drastically next year and that’s going to impact everyone, including people who are not availing subsidies from the exchange. The reason is simple – the Supreme Court decided to entertain the King v. Burwell argument and the decision on the same will not be disclosed before late June.

In King v. Burwell, the plaintiffs have moved the Court against a particular verbiage in the law that, according to plaintiffs, does not allow the federal government to issue health insurance subsidies to consumers from states which have not established their own health exchange. Under this challenge, 34 states that are using the federal exchange cannot legally provide subsidies to their citizens. On the other hand, the administration says that in the context of the entire law, this challenge holds no basis and the intention behind framing the law was to provide subsidies to states that are providing health insurance through the federal marketplace.

The federal appellate courts agree with this argument of the Obama administration and the same sentiment was echoed in Fourth Circuit Court of Appeals in Richmond last year, establishing the subsidies as legal in the 34 states that are using the federal marketplace to provide ACA coverage to citizens. However, when the Supreme Court decided to hear the case, it got a lot moreserious. Now, with Supreme Court deciding to disclose the decision by late June, health insurance plans are in a state of confusion, as they need to submit their health insurance premium rates for 2016 by then. For preparing these premium rates, health plans need to figure in an important factor – what happens if the plaintiffs prevail?

State Exchange

A lot of people who are using subsidies to pay for their health insurance would, obviously, no longer be able to do so. Naturally, this might cause a large number of people to drop their coverage. The highest probability is that the healthy, young people will be the ones that drop coverage, as they will feel coverage isn’t necessary. Once that happens, the percentage of older, sicker people will outmatch the percentage of young, healthy people. To keep the scales balanced, health insurance firms will be left with no other option but to raise premiums to compensate for the larger unhealthy pool.

However, there is a quick solution, the American Academy of Actuaries suggested that the HHS should allow health plans to submit two potential rates – one if the subsidies stay intact and other if the subsidies are scrapped. In that case, two sets of insurance premiums will be available, and that might have a better impact on the mechanics for next year. However, in case the administration does not take this route, most health insurers are expected to prepare for the worst by excluding insurance subsidies in their calculation of market dynamics and presenting health insurance premiums that will be much higher.

No matter which way Supreme Court decision goes, health plans will mostly prepare for the worst and present premiums that will be higher for everyone, even for those who were exempt from subsidies in the first place.

Obamacare has turned 5 and the journey has been far from comfortable. Fortunately amid challenges from opposition, a dysfunctional initial rollout, and slow acceptance of the law, Obamacare has still achieved what it set out to five years earlier, even if there is a lot more ground to cover in the coming years. Owing to the law, the US healthcare industry has seen massive improvement in the way healthcare is availed. At the completion of five years, here are 5 numbers that show the major strides of the government, the impact of the law, and the avenues that require attention in the coming years.

1) 16.4 million have enrolled through Obamacare marketplaces – The biggest achievement the ACA has delivered is the mammoth 16.4 million enrollments through the exchanges in two open enrollment seasons. When ACA was implemented, 47 million people did not have health insurance. Although the number continued to grow over the years, 16.4 million of those people found affordable health insurance through exchanges. Out of these, as many as 85 percent were able to avail subsidies and cost assistance from the government for keeping their health insurance premiums in check.

2) $7.4 billion dollars were saved by Hospitals in uncompensated costs – Combining the effect of health insurance marketplaces and Medicaid expansion, hospitals have been able to save $7.4 billion in uncompensated costs. Before ACA, hospitals have covered insurance care for uninsured and underinsured. Hospitals delivered about $50 billion in uncompensated care in 2013. Medicaid expansion under ACA has also played a major role in cost savings. For instance, states that expanded Medicaid experienced a 26 percent reduction in their costs, while states that did not expand Medicaid experienced only a 16 percent reduction.

3) 29 States and DC expanded Medicaid to complement the coverage net of ACA – Medicaid expansion was a crucial aspect of the working of the ACA. Although the U.S. Supreme Court shot down the mandatory expansion of Medicaid under ACA, it left states with a choice to support the law through expansion. 29 states and DC expanded Medicaid to cover healthcare costs, and these states were able to observe a huge improvement in their healthcare cost savings and coverage net. People did not fall into the coverage gap, which opened up in states that decided not to expand Medicaid.

4) $88 billion  has been foregone by States that decided not to expand Medicaid – The remaining states which decided not to expand Medicaid left their residents between a rock and a hard place. At the same time, these states let go of $88 million  in federal grants, which they would have received between 2014 and 2016 if they had decided to expand Medicaid in their state. With a limited healthcare system of these states, residents will be less likely to use medical services, which would ultimately impact the contribution to national economic growth. Without Medicaid, a lot of people will not use medical services, and this will play a detrimental role in the coming years. For instance, by 2023, Florida will lose out on $270 billion national economic impact because it did not expand Medicaid.

5) $1.2 trillion will be Obamacare’s cost for the next decade – Owing to a close check on healthcare spending and healthcare costs, Obamacare will be costing about 11 percent less than earlier estimates. Over the next decade, $1.2 trillion will be spent on Obamacare. Other than the control of ACA on healthcare spending, lower costs of health insurance subsidies will contribute to lower spending. Assuming that the law lasts for that long and is not strangled by the Republican repeal efforts, there is a lot Obamacare can change in the healthcare system.

11 million enrollments and a successful second open enrollment later, the Obama administration should be happy. Enrollment numbers are higher than initial projections, and the signs of a working health reform are omnipresent in the system. Health insurance carriers are adapting to the new marketplace scenario, and are offering better plans at better prices to marketplace shoppers. In addition, citizens are embracing the health insurance marketplace. Collectively, both the providers and shoppers are maturing with the system, and all of this is fueling the success of the ACA.

Out of the shoppers this year, about 4.2 million are returning customers who have revisited the improved marketplace to check their existing plan, weigh available benefits, and upgrade their plans for better benefits. A noteworthy aspect of these shopping trends is the underlying shopper aggression for utilizing market competition to find better health plans with cheaper premiums. Let’s take a look at the behavior of returning and new shoppers, and how they interacted with the marketplace to find the plan that fits their requirements.

The first segment of people is returning customers who automatically reenrolled with their previous plan. Roughly 2 million people chose to stay with their existing plan, and none of them revisited the exchange to weigh available options. Of the remaining shoppers in the 4.2 million returning customers, a little more than half went for new insurance plan this year, while the other segment continued with their existing plan. Nearly 1.2 million people enrolled with a different plan in the second enrollment. While this might not seem like a big number in comparison to the enrolled 11 million, past health insurance industry trends say that this is a pretty big number.

According to CMS, a lot of insured are actively and aggressively seeking better insurance options, and this high number of active consumers is surprising for the health insurance industry. At a preliminary stage, there are two possible reasons why revisiting shoppers looked for new health insurance. The primary reason is cost. Owing to entry of new insurers in the market and adjustment of last year’s premium prices on the basis of available data, a lot of insurance plans offered cheaper health insurance with nearly similar coverage. Another factor that boosted plan switching on cost basis was the subsidy averaging, which considers the cheapest plan available in a consumer’s area while issuing premium tax credits to consumers. So, people who had the option to retain their older plan were likely to be subject to a higher cost as a cheaper plan was available in the region, and the subsidies were to be calculated accordingly. Naturally, a lot of people decided to switch.

The second probable reason for shopping is coverage quality. To retain profitability and market edge, a lot of insurance plans have limited their physician networks. A lot of plans have also included high out of pocket costs. It is possible that a lot of people changed their plans because they wanted access to a wider network or limited burden of deductibles, co-payments and the works. Add the remaining number of 4 million plus people who were using the exchanges for the first time, and you will have considerable shopper movement across the marketplace.

While it is still early to stay exactly what factors contributed to this aggressive shopping surge on the health insurance marketplace, one thing is certain – as the insurers and shoppers mature in the ACA model, a lot of streamlining will automatically happen in terms of coverage options, competitive pricing, and physician networks. Both these forces are still moving to a state of equilibrium, and in the next couple of years, the nature of shoppers will change to reflect that stability. For now, health insurance shoppers are working to make sense of the marketplace and aggressively switching health plans for arriving at their desired combination of price, coverage, and network.