Health Insurance Exchanges: Challenges and Opportunities for Pharma

Dennis M. Falci, MBA, director, Sanofi-Aventis SA, says it’s no secret—Health Insurance Exchanges (HIEs) are a hot topic in health news.

HIEs are mandated as part of the Affordable Care Act (ACA), providing coverage to nearly 44 million people in the United States. Likening the exchanges to consumer tools such as Expedia, Mr Falci says insurance marketplaces function as a “one stop shop for healthcare,” helping Americans to find health plans that “meet their needs and reflect their eligibility.”

Once consumers are logged on a HIE web portal, they can choose from a variety of health plans. Levels of coverage include:

• Catastrophic: For people under 30 who cannot find coverage that is less than 8% of their income
• Bronze: Pays for 60% of benefit package
• Silver: Pays for 70% of benefit package
• Gold: Pays for 80% of benefit package
• Platinum: Pays for 90% of benefit package (for medal plans, remaining amounts are paid by consumer)

Mr Falci notes that the US Health and Human Services (HHS) Department established these exchanges to set minimum coverage standards, something previously handled by state regulators or employers. They also ensure that plans include essential health benefits, including ambulatory patient services, hospitalization, maternity care, mental health services, and 6 other “essential" services.

There is broad eligibility for expected purchasers, and most are expected to receive subsidies. The “exchange-eligible population” includes 26 million Americans eligible for premium credits; a median age of 33; 70% are considered to be in good to excellent health; and 56% are employed full time.

Mr Falci concludes that the impacts of the HIEs are obvious, but that communities and industry can expect to see more in the coming year as other ACA mandates are initiated.