Some families who purchased health coverage through the Massachusetts Connector wound up with high financial burdens

Abstract

Health insurance exchanges created under the Affordable Care Act will offer coverage to people who lack employer-sponsored insurance or have incomes too high to qualify for Medicaid. However, plans offered through an exchange may include high levels of cost sharing. We surveyed families participating in unsubsidized plans offered in the Massachusetts Commonwealth Health Insurance Connector Authority, an exchange created prior to the 2010 national health reform law, and found high levels of financial burden and higher-than-expected costs among some enrollees. The financial burden and unexpected costs were even more pronounced for families with greater numbers of children and for families with incomes below 400 percent of the federal poverty level. We conclude that those with lower incomes, increased health care needs, and more children will be at particular risk after they obtain coverage through exchanges in 2014. Policy makers should develop strategies to further mitigate the financial burden for enrollees who are most susceptible to encountering higher-than-expected out-of-pocket costs, such as providing cost calculators or price transparency tools.

Keywords: Cost Of Health Care; Health Reform; Insurance; Insuring Children.

Exhibit 4

Predicted probabilities of financial burden and higher-than-expected out-of-pocket costs SOURCE: Authors’ calculations using enrollment, claims, and survey data for Harvard Pilgrim Connector members NOTES: Financial burden model controls for number of children, subscriber with fair/poor health, adult with chronic condition, child with chronic condition, income, and Bronze plan. Higher-than-expected costs model controls for number of adults and children, subscriber age, adult with chronic condition, child with chronic condition, income, and deductible plan. p<0.01 for comparisons by income for financial burden and comparison s by number of children for higher-than-expected costs. p < 0.05 for comparisons by number of children for financial burden and comparisons by income for higher-than-expected costs.