Is that what the Department of Health and Human Services doing in their denial of a request to have special, continual open enrollment for a new qualifying life event of pregnancy?
The Department of Health and Human Services has denied a request from Democrats to create an open enrollment period under the Affordable Care Act for women when they find out they are pregnant, The Hill reported. Secretary Sylvia Matthews Burwell said HHS does not have “the legal authority to establish pregnancy as an exceptional circumstance.”
I am not a lawyer and I don’t even play one on the internet, so I’ll defer to the legal interpretation but I completely understand from a policy perspective why HHS does not want to go this route for Exchanges.
Pregnancies are common, and moderately expensive on a per-event basis ($8,000 to $15,000 for non-complicated pregnancies). A reasonably high level of people know if there is a reasonable chance of their being pregnant in the next year as all guys, women of a certain age
over 45, women with tubal ligation etc all know that they can’t get pregnant. Within the pool of women who could be potentially pregnant, there is a reasonably decent intuition as to who may or may not get pregnant. For instance, I know my sister-in-law is wearing my brother out right now trying to get pregnant. My younger sister has no intention of being pregnant this year. Pregnancy is a very straight forward adverse selection problem.
If there is continual open enrollment on the private insurer Exchange policies, either there will be a pricing problem as the policies get more expensive as the women who only got insurance because they thought there was a decent chance of pregnancy in the policy year opt out en masse and then only the pregnant women re-enroll which makes the net risk pool more expensive on average or health plans will race to the bottom and offer as unattractive maternity care options as possible so as to shift the health risk to another insurer that offers a decent network with decent co-insurance.
The Democrats who requested a special enrollment period identified a real policy problem. Every pregnant woman should receive good pre-natal care, and a childbirth should not be a financial crisis for a family. However, the appropriate policy response in a rational political world would be to expand Medicaid coverage to make pregnancy an automatic qualifier with full federal funding as the back-stop of private insurance. Medicaid does not care about adverse selection, so it can handle constant spike claims without destroying the rest of the program.