Newest Policyholders Under Health Law Are Sicker and Costlier to Insurers


WASHINGTON — People newly insured under the Affordable Care Act were sicker, used more medical care and had higher medical costs than those who already had coverage, the Blue Cross and Blue Shield Association said Tuesday in a new study of its policyholders.

Because insurers’ premiums have to cover their medical expenses, the new report helps explain why Blue Cross plans have sought, and insurance commissioners have approved, substantial rate increases in many states. Another round of rate review is about to begin, with insurers generally required to file rate requests for 2017 in the next two months.

The findings are noteworthy because Blue Cross and Blue Shield plans operate across the country and have the largest share of the individual market in many states, giving them an unrivaled source of claims data.

In its report, the Blue Cross and Blue Shield Association examined the use of medical services by people who enrolled in its plans before and after major provisions of the Affordable Care Act took effect in 2014.

One of those provisions essentially required insurers to offer coverage to people who had previously been denied coverage because of their medical problems.

People newly enrolled in individual Blue Cross health plans in 2014 and 2015 were found to have higher rates of certain diseases and conditions, including high blood pressure, diabetes, depression, coronary artery disease, H.I.V. and hepatitis C, than people who already had coverage.

Diabetes was nearly twice as common among newly enrolled consumers as among those previously enrolled, the report said. Hepatitis C was more than twice as common, and H.I.V. was more than three times as common, it said.

Likewise, the report said, consumers newly enrolled in Blue Cross plans in 2014-15 used more medical services than those who first bought coverage before 2014. Hospital admission rates were 84 percent higher, it said, and the frequency of visits to doctors and other medical professionals was 26 percent higher.

Blue Cross said the study was based on claims for 4.7 million people. About one-third had been continuously enrolled since 2013; the others signed up in 2014 or 2015.

Administration officials said the study showed the need for the health care law, signed six years ago by President Obama. “It’s no surprise that people who newly gained access to coverage under the Affordable Care Act needed health care,” said Ben Wakana, a spokesman for the Department of Health and Human Services. “That’s why they were locked out of coverage before.”

Alissa Fox, a senior vice president for the Blue Cross and Blue Shield Association, said the differences in the prevalence of disease could narrow as newly insured consumers receive care and medications to prevent and treat illnesses. Blue Cross companies have programs to help consumers “get healthy faster and stay healthy longer,” she said.

New insurance policies are often more generous and comprehensive than individual policies sold before the health care law. The new policies must, for example, cover maternity care and mental health and substance abuse services.

Some of the people buying insurance under the health care law come from states’ “high-risk pools,” created specifically for people with cancer, heart disease or other serious medical problems.

In rate requests filed with state regulators in the last two years, many insurers said they had been aware of a pent-up demand for health care, but had underestimated how much care their new customers would require.

Researchers and health policy experts had predicted that people with higher medical costs would enter the market in the first few years of the public insurance exchanges. And the health care law provided special payments to insurers with unexpectedly high costs.

Federal and state officials and consumer advocates said they hoped that premiums would become more stable and predictable in the next couple of years.