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Report Shows the Effects of COVID-19 on Health Coverage, Reinforces the Value of Pennsylvania's State-Based Exchange

September 16, 2020

According to a recent report from The Commonwealth Fund, insurance coverage gains associated with the Affordable Care Act (ACA) have stalled or eroded in most of the states between 2016 and 2018 after improving in all states between 2014 and 2016. The report also found that decades-long gains in life expectancy started to deteriorate after 2014 due to deaths from suicide, alcohol, and drug overdose as well as premature deaths from treatable conditions. In Pennsylvania and across the nation, there is concern about these trends in the wake of the economic downturn caused by the COVID-19 pandemic, along with nearly 200,000 deaths and continued reports about individuals delaying care.

A recent report from the Urban Institute’s Health Policy Center estimates that, nationwide, by December 2020, more than 10 million people no longer will have employer-sponsored health coverage due to job losses related to COVID-19. The U.S. Department of Labor reports that more than 50 million people have lost jobs or been furloughed since March. In addition, as of July, Pennsylvania’s uninsured rate was 13.7 percent (up from 4.7 percent during February).

Later this month, Pennsylvania will launch a new state-based insurance exchange, “Pennie,” for the 2021 open enrollment period that begins on November 1. During July 2019, Governor Wolf signed into law Act 42, giving Pennsylvania the authority to implement a state-based exchange to improve the accessibility and affordability of individual market health coverage for Pennsylvanians.

The decision provides a number of benefits to Pennsylvanians, including:

  • Flexibility to react to changes and serve residents in the way that’s best for them
  • Local control of a robust in-person assistance program, education, communications, and customer service
  • Decreased operational costs and an ability to keep dollars in-state
  • Lower health insurance premiums (reduction of approx. 5–10 percent) in the individual insurance market through the implementation of a reinsurance program
  • Ability to work more closely with insurers and foster a competitive marketplace
  • Better oversight and management of the Medicaid churn population, some of Pennsylvania’s most vulnerable

The Insurance Department currently is working on a public awareness campaign to introduce Pennie to the general public, and HAP will provide additional information to members to support the consumer education effort.

The Commonwealth Fund’s recent report, 2020 Scorecard on State Health System Performance, provides state-by-state report measuring access to care, quality of care, health outcomes, and health disparities across the United States. It ranked Pennsylvania 21st among other states and noted the state’s top ranked indicators were alcohol deaths, adults without a usual source of care, and adults who went without care because of cost. The report also found that three-quarters of the overall national spending growth between 2014 and 2018 is attributed to increased prices, and this led consumers to pay higher costs for commercial plans.

For questions or more information, contact Jolene Calla, Esq., HAP’s vice president, health care finance and insurance.