As of today, the answer is still unclear.
In June, the government announced that marketplace renewals would be automatic. The Centers for Medicare & Medicaid Studies (CMS) affirmed this announcement by claiming that approximately 95 percent of renewals would take place automatically. CMS is responsible for administering a variety of social programs including the federal health insurance exchange site known as the marketplace. However, more recently, federal authorities now say that many marketplace enrollees will have to re-examine their policies and renew plans manually.
Issues with Automatic Renewal
Federal authorities have instructed insurance companies to start sending out renewal notices to their customers beginning this month. The notices provide vague information about what consumers need to do to keep their current coverage. In fact, a lot of the notices indicate that consumers won’t be required to do anything to renew their coverage. The language used is misleading according to consumer advocate groups.
CMS can’t promise consumers will find the same insurance plans or be able to apply for the same financial subsidies in 2015 as they had last year. In addition, premium rates may rise significantly for some families. Renewal notices do indicate rate increases for 2015.
Could the issue of manual renewals have been avoided? Unfortunately, passive renewals aren’t really an option for most people because the government lacks the appropriate data to offer real quotes on coverage and subsidies. In other words, the government can’t give enrollees a good idea of what kind of plan they qualify for in 2015 or how much financial assistance they can get. Information available to the government is outdated by a couple of years. As a result, people will need to re-examine their policies manually.
One other major problem is the government’s inability to track and store user data to calculate appropriate coverage estimates or even send out the right notifications. For instance, enrollees who have lost coverage due to non-payment might receive an automatically generated renewal notice claiming that they will be enrolled for 2015.
Vague, Misleading Language
The renewal notices being sent out this month may confuse millions of consumers according to consumer advocate groups. But these groups aren’t alone in critiquing the use of vague language. Insurance companies claim that the renewal notices will mislead consumers into thinking that they will be enrolled into the same plans with the same level of financial assistance. In reality, some consumers will pay higher premiums and receive less assistance via subsidies.
Concerned parties also argue that manual enrollment creates a bigger hassle for average consumers. Not only will enrollees have to revisit the marketplace to sign up for 2015, but they’ll also have to conduct more research to find the plan they want. Enrollees can use the HealthCare.gov Plan Compare or “plan finder” feature to locate their existing plan, but advocate groups insist that these methods are confusing and complicated.
In addition, people who need to report changes in family size or income must now go online or call the customer service line because the government has eliminated the option to mail status updates. Consumer advocates argue that low-income families who don’t have access to computers will have to fight through congested phone lines just to update basic information.
Choosing a Better Plan
Despite the issues raised by manual enrollment, marketplace enrollees will gain some benefits in being forced to review their coverage. For starters, many families will be able to shop for better plans than they could have afforded last year. Since the Affordable Care Act required everyone to buy insurance, many consumers had to readjust their budgets to include the cost of healthcare. Now, enrollees have greater flexibility in shopping the market.
Additionally, manual reviews make it easier for people to ensure that they’re getting the right coverage for their needs. Families and incomes change throughout the year, and automatic renewal doesn’t always account for these changes. For 2015, families should re-examine their needs to find a plan that addresses those needs.
Many enrollees will receive a notice from their insurance company and another notice from the government outlining renewal information for the coming enrollment period. Consumers should set aside some time to speak with their insurance representative to find out how automatic renewal will affect their enrollment.
According to the Congressional Budget Office (CBO), approximately eight million people have signed up for health insurance using the marketplace sites. And they expect about 13 million people to enroll in a plan via the exchange during the next enrollment period. Open enrollment for 2015 will take place from Nov. 15 through Feb. 15.