Finally, some individuals may desire health insurance but have difficulty
purchasing it. 63 The challenges they face could extend far beyond the well-publicized problems with online registration, such as long online waits, inability to open accounts, duplicate enrollments and other data errors, and missing information on the government website. 64 Although the ACA contains
mechanisms that supposedly remove the incentive for health insurers to favor
individuals who are healthier over sicker enrollees and therefore would be
the most profitable, 65 insurers still have reasons to be selective in whom they
enroll. For example, actuarial consultants have determined that the risk adjustment method used by the ACA pays health plans more for patients with
certain conditions than patients with other conditions. 66 Health plans therefore can be expected to discourage certain types of patients from enrolling
using cherry-picking techniques similar to those that they employed prior to
the enactment of the ACA, such as how they structure their benefits packages
and market their policies. 67 Nothing in the ACA forbids this insurer behavior. 68
63. See Key Facts about the Uninsured Population, KAISER FAM. FOUND. (Oct. 5, 2015),
http://kff.org/uninsured/fact-sheet/key-facts-about-the-uninsured-population/ (stating that
“many uninsured people cite the high cost of insurance as the main reason they lack coverage”).
64. See Robert Pear et al., From the Start, Signs of Trouble at Health Portal, N. Y. TIMES,
Oct. 12, 2013, http://www.nytimes.com/2013/10/13/us/politics/from-the-start-signs-of-
trouble-at-health-portal.html (reporting on the problems with enrollment on the health insurance marketplace when the website first opened); see also Amy Goldstein, HealthCare.gov
Can’t Handle Appeals of Enrollment Errors, WASH. POST, Feb. 2, 2014, https://www.
enrollment-errors/2014/02/02/ bbf5280c-89e2-11e3-916e-e01534b1e132_story.html (
reporting some of the issuing impacting individuals who tried to enroll in health plans through the
health insurance marketplace during the first few months).
65. See Explaining Health Care Reform: Risk Adjustment, Reinsurance, and Risk Corridors, KAISER FAMILY FOUND. (Jan. 2014), http://kff.org/health-reform/issue-brief/explaining-health-care-reform-risk-adjustment-reinsurance-and-risk-corridors/ (discussing in length the
three risk programs (the “3R’s”), which includes: risk adjustment, reinsurance, and risk corridors).
66. See Jason Siegel & Jason Petroske, When Adverse Selection Isn’t: Which Members
Are Likely to Be Profitable (or Not) in Markets Regulated By the ACA, MILLIMAN 2-3 (Dec.
2013) (The ACA risk-adjustment method, which is based on the method that CMS uses to
risk-adjust premiums for Medicare Advantage Plans, only adjusts for certain conditions—
those that are listed in CMS’ Hierarchical Condition Categories (HCCs). Many conditions are
not listed, and therefore, do not result in increased payments to the health plan after adjustments for risk. Risk-adjustment works by requiring all plans pay into a fund and making proportionately larger payouts from the fund to plans that enroll less healthy individuals. Plans
that enroll more persons with HCC conditions will receive more from the fund than plans that
enroll fewer persons with HCC conditions).
67. Adverse Selection Issues and Health Insurance Exchanges Under the Affordable Care
Act, NAT’L ASSOC. OF INS. COMM’N. 3 (2011), http://www.naic.org/store/free/ASE-OP.pdf.