November 15 marks the start of the second open enrollment period, during which the Congressional Budget Office (CBO) projects 7-8 million additional consumers will enroll in a Qualified Health Plan (QHP) through federal and state insurance marketplaces. While no one expects to be dealing with the kinds of technical obstacles that hampered the inaugural enrollment season, several significant challenges are anticipated when the marketplaces open for the second time.
First, while the number of enrollees taking part in the 2015 open enrollment period is expected to be similar to 2014 levels, they will have just three months to shop, compare, evaluate and purchase coverage before the 2015 open enrollment window closes—three months less than 2014.
Second, at the same time 2015 open enrollment is underway, every QHP purchased last season will be up for renewal. HHS has proposed automatic renewals to streamline the process, however a sizable percentage of the 8 million enrollees—many of whom are now far savvier than they were last time—will be eager to compare their current plan with new ones. Some will be forced to look at new options due to plan cancellations or provider shifts, while others will want to re-determine what subsidy may be available if work, income or family changes took place during 2014.
Thus, health plans will be challenged to effectively communicate information on premium increases, discontinued policies and new QHPs approved for 2015—while at the same time communicating and educating first-time enrollees.
Further, roughly 45% of members who bought coverage last season were “orphans,” with no agents to guide them through the process. These individuals will need just as much hand-holding during renewal as they did during the previous open enrollment period.
These orphan members represent a significant paradigm shift in online insurance purchasing—one that places a high priority on retention. Health plans must address this change if they hope to achieve long-term success in today’s exchange-driven market. Having both inbound and outbound resources available to field questions and undertaking targeted outreach to help members navigate their coverage options are also important to achieving high renewal rates.
This is the value proposition HealthPlan Services (HPS) brings to the table. By outsourcing retention to HPS, health plans can leverage our proven strategies and analytics expertise to ensure high renewal rates in today’s competitive insurance landscape.
A number of potentially lucrative opportunities are also coming into focus as the 2015 open enrollment period draws near. For example, as small businesses grow more confident in the stability of public exchanges, they can evaluate whether to sustain coverage or drop it and allow employees to shop on insurance marketplaces. Price is a driving factor. Inc. reports that individual marketplace plans can cost 20-30% less than comparable group plans, while Kaiser Family Foundation reports premiums increased by 80% over the last decade for the approximately 150 million U.S. workers and their family members with employer-sponsored coverage.
Another opportunity lies in family coverage. One independent study found that 53% of households did not enroll one or more dependents during 2014 open enrollment. As a result, family plans are expected to enjoy a surge in popularity during the 2015 open enrollment season. Another factor in the popularity of family coverage will be greater affordability and consumers’ increased comfort with the purchase process.
While there remains work to be done behind the scenes, the 2015 open enrollment season is ultimately shaping up to be highly successful for those health plans that understand the emerging opportunities and that have taken a proactive retention approach—whether in-house or by partnering with HPS.