Abstract
The commercial health insurance market is characterized by consistently high enrollee turnover. Turnover can disrupt care continuity for patients and create challenges for insurers in managing the health of their enrollee populations. Yet the extent to which enrollees reenroll is not widely known. To characterize rates of disenrollment (hereafter, external turnover) and reenrollment in commercial health plans. In this retrospective longitudinal cohort study, trends in turnover and reenrollment in commercial health plans between January 1, 2006, and August 31, 2018, were analyzed. Data analysis was conducted from January 21, 2020, through December 23, 2021. Participants included 3 018 633 primary members and their dependents with employer-sponsored coverage. Primary outcomes included external turnover from commercial coverage and subsequent reenrollment into any line of business with the insurer (commercial, Medicaid Managed Care, and Medicare Advantage). Within commercial coverage, external turnover was analyzed separately for group (ie, employer-sponsored) and individual markets. In the sample of 3 018 633 members, 50.2% were men; mean (SD) age, including dependents, was 30.68 (19.05) years. A total of 2.2% of members experienced external turnover each month and 21.5% experienced external turnover each year. The individual market had the highest average monthly turnover rate of 3.4% compared with 2.1% in the group market. December had the highest rate of external turnover, with 13.8% experiencing external turnover in the individual market and 6.9% of members experiencing external turnover in the group market. Fourteen percent of the members who left the insurer from an individual plan reenrolled with the insurer after 1 year, and 34% had reenrolled after 5 years. Among members who left the insurer from a group plan, 12% reenrolled after 1 year and 32% reenrolled after 5 years. After 10 years, reenrollment reached 47% in the 2 markets. More than 80% of enrollees returned to the same line of business and within the same state, suggesting findings may generalize to smaller insurers. The findings of this cohort study suggest that insurers may benefit from investing in members' long-term health outcomes despite substantial short-term turnover rates.
Highlights
Unlike other countries with national health systems, the organization of the US health insurance industry creates numerous opportunities for enrollee turnover
December had the highest rate of external turnover, with 13.8% experiencing external turnover in the individual market and 6.9% of members experiencing external turnover in the group market
Most members were enrolled in preferred provider organizations (76%), with smaller shares enrolled in health maintenance organizations (14%) and consumer-directed health plans (10%)
Summary
Unlike other countries with national health systems, the organization of the US health insurance industry creates numerous opportunities for enrollee turnover. In the commercial market ( referred to as the private market), multiple insurers compete for employment-based insurance contracts and individual enrollees. Commercial insurers’ enrollee turnover reflects member choices to switch insurers and member choices to switch employers and employer choices to switch insurers. Medicare and Medicaid are subject to turnover (churn), with beneficiaries often choosing among privatized plans, and Medicaid enrollees face the added risk of losing eligibility owing to income fluctuations. Between 15% and 20% of both privately and publicly insured individuals experience coverage disruptions or change plans each year.[1,2,3,4,5,6,7] Research on health insurance plan choice has identified factors that explain turnover in both contexts, including individual characteristics and behavioral factors, such as inertia or inattention.[8,9,10,11,12,13] A complementary set of studies has evaluated the direct and relatively short-term consequences of turnover, including how associated disruptions in insurance coverage can lead to disruptions in health care use.[14,15,16]
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