Today Ed Lazere testified on how to make DC’s Health Benefit Exchange the most beneficial to consumers. Here’s his testimony:
Chairwoman Alexander and other members of the committee, thank you for the opportunity to testify today. My name is Ed Lazere, and I am the executive director of the DC Fiscal Policy Institute. DCFPI engages in research and public education on the fiscal and economic health of the District of Columbia, with a particular emphasis on policies that affect low- and moderate-income residents.
I am here today to support the DC Health Benefit Exchange’s effort to ensure that residents who buy individual insurance and small employers have access to a range of high-quality health plans, helping fulfill the promise of the Affordable Care Act (ACA) to improve consumer protections and health benefit standards. The DC Fiscal Policy Institute supports the transition to a unified health insurance market under the DC Exchange, which will foster transparency, competition, and choice for District consumers. It will strengthen the District’s reputation as a national leader in providing quality and affordable health care to all of its residents.
The exchange’s online shopping portal will give small businesses and individuals an easy way to shop for health plans and to get help to pay for them. The exchange will act as a clearinghouse of options, helping individuals decide what plan is best for them. The exchange also will help make health insurance more affordable to both individuals and small businesses, as the place they go to apply for federal tax credits and other subsidies.
The exchange will create real transparency, allowing consumers to know exactly what they are getting with a specific plan and to compare features across plans, side-by-side. The online portal will allow also for stronger monitoring and enforcement of both local and federal standards. ACA protections that are currently harder to monitor, such as guaranteed issue or the ban on pricing based on pre-existing conditions, can be easily tested and enforced within the exchange.
A unified market is critical to enabling the exchange to live up to this potential and will bring many benefits. A unified exchange will create one large pool of individual residents and small business employees, creating the purchasing power traditionally reserved for large employers. This will incentivize insurance companies to compete for business, which will drive down prices and expand the number of options available. With full carrier participation in the exchange and a transparent shopping portal, insurers will have to compete based on price and quality of their products, sparking innovation in benefit design and improving the consumer experience.
The unified market also will result in improved choice for individuals, small businesses, non-profits, and employees. Today’s market has one or two dominant carriers controlling most of the market share, and individuals and very small employers often face few, if any, plan choices they can actually afford. The unified market exchange will allow insurance carriers to sell as many products they want and will help residents connect with any plan available in the individual market. Small employers, including non-profits like ours, will have similar if not more choices than they do today. The exchange lets small businesses expand choice even further by allowing their employees to choose from a wide range of insurance carriers, instead of the common practice of offering just one or a few plan options.
The DC Council has an opportunity to improve the quality, affordability, and accessibility of health plans sold in the District using the unified market exchange. The transition allows time for the Exchange Authority to assess and improve the market structure and information technology needed to give residents and small businesses the optimal experience. DCFPI supports the transition to a unified market exchange and we urge Council to do the same.
