One of the primary goals of the Affordable Care Act (ACA) is to provide consumers with increased access to health insurance.  While both healthcare.gov (hc.gov) and State based marketplaces (SBMs) have made significant progress towards this goal, it has been a costly endeavor with several SBMs dealing with ongoing financial and technology challenges that still persist today.  As Congress and the administration look to improve the ACA and as SBMs seek to streamline operations, cut costs and expand access to health insurance, a viable approach that should be considered is developing collaborative relationships with the private sector to help achieve these goals.

Public-Private Partnerships (P3s) are being embraced globally across a wide range of industries including healthcare and the use of P3s is on the rise.  Through public-private partnerships both government and the private sector can improve decision making, improve coordination and lower costs through shared risk.  A 2015 a Department of Treasury report concluded that if executed and managed correctly, P3s can lower costs, provide better service quality and faster project delivery.1

So how can P3s play a role with the ACA?  For decades payers, web based entities (WBEs) and private exchanges (PHIXs) have been assisting consumers with the purchase of their health insurance as well as providing robust and intuitive decision support tools designed to help consumers make informed choices.  These private sector entities represent additional distribution channels that could increase overall enrollment.  Additionally, financial sustainability is and will continue to be a challenge for several of the SBMs and this is another area where the private sector can provide proven technologies and services to help SBMs lower the overall cost of acquisition. Lowering the cost of acquisition in turn lowers operational costs and helps bolster sustainability.

The following two diagrams illustrate the current marketplace health insurance distribution process and what the future health insurance distribution process might look like in a public-private partnership arrangement.

Figure1
Figure #1 – Current distribution process
For illustration purposes only
Figure2
Figure #2 Future distribution channels and process
For illustration purposes only

During that last open enrollment period (OEP), payers and WBEs were able to facilitate consumer enrollment on hc.gov through a process known as direct enrollment (Figure #1).  However, the current version of the direct enrollment technology redirects consumers from the payers or WBEs web site to the FFM and then redirects them back.  This does not provide a seamless and intuitive consumer experience and thus many payers and WBEs have decided to wait until the technology has improved.  Additionally, direct enrollment is only available to payers and WBEs and has not been made available to private exchanges. The administration is working to improve direct enrollment and it is anticipated the next iteration of direct enrollment will be available for the 2017 OEP.  Currently there are no SBMs supporting direct enrollment via payers or WBEs, but several SBMs are evaluating the benefits of opening addition distribution channels that could include payers, WBEs, PHIXs or some combination of these.

As figure #2 clearly illustrates, the inclusion of payers, WBEs and PHIXs on both SBMs and hc.gov has the potential to increase the number of distribution channels.

Accenture forecasts enrollment of employees in private exchanges will grow to 12 million in 2016 and 22 million in 2017 and will remain on track to reach 40 million enrollees by 2018.2

As more distributions channels are made available, there is strong evidence that suggests there would be a corresponding increase in the number of consumers enrolling in both subsidized and non-subsidized health insurance via the marketplaces.

Public-private partnerships have a proven track record in many different industries.  The administration, states and these private sector entities all have aligned goals and an opportunity now exists to create synergetic partnerships.  By partnering with payers, WBEs and PHIXs and with improvements to direct enrollment, hc.gov and SBMs have the potential to increase enrollment through greater distribution while ostensibly lowering overall costs.  Leavitt Partners is optimistic and anticipates that public-private partnerships in this space will develop over the next 12 to 24 months.