Health Literacy and the Potential Impact on Health Insurance Exchanges

While the Disease Management Care Blog has occasionally been a snarky critic of the Affordable Care Act, it really likes uncovering policy insights and then coating them with the sweet chocolate of physician-laced cynicism.

For example, the DMCB pointed out that health insurance exchanges are surprisingly complicated and, as a result, it's very possible that Uncle Sam and the states will fail to meet their 2014 deadline.  It's in that spirit that, thanks to this recent JAMA Commentary, that the DMCB is warning that another problem could gum up insurance enrollment through the exchanges. 

Underestimated levels of poor health literacy may stand between millions of U.S. citizens and exchange-enabled access to the ACA's publicly funded and subsidized insurance plans.

Writing in the August 24/31 JAMA issue, RAND scientists Laurie Martin and Ruth Parker point out that health literacy can be defined as "the degree to which individuals have the capacity to obtain, process, communicate and understand health information and services needed to to make appropriate health decisions.  According to the IOM, a stunning 90 million Americans lack this standard of health literacy and more than half of those currently without insurance have borderline or insufficient skills to navigate health care decision making - which includes understanding eligibility criteria for insurance or subsidies, completing forms, providing documentation, discerning the differences between various out-of-pocket expense options and how exclusions of coverage may work.  Little wonder that millions of persons eligible for Medicaid fail to take advantage of it.  As a result, building an insurance exchange does not mean that they will come.

The DMCB read that Massachusetts' lawmakers realized that there might be a problem and set up consumer-friendly mechanisms to aid consumers with the tedious details of on-line form completions and decision making. 

Hopefully other states and the federal government will figure out ways to do this also.

Otherwise, exchanges will be the party ... and no one will come.