Saeed Aminzadeh

Niko Lehman-White

By NIKO LEHMAN-WHITE and SAEED AMINZADEH

IntroductionEvery day and in every corner of the country, innovative health care leaders are conceiving of strategies and programs to manage their patients’ health, as an alternative to treating their sickness (see Figure 1).

The value-based contracts that have proliferated in this
country over the past decade and which now account for about half of the money
spent on healthcare allow these wellness investments to make good financial
sense in addition to benefiting patient health.

However, a phenomenon in health coverage in the US is
increasing costs, destabilizing care continuity and holding back the potential
of value-based care. It prevents us from making the long-term investments we
desperately need.

Understanding Churn

Churn refers to gaining, losing, or moving between sources of coverage. Every year, approximately a quarter of the US population switches out of their health plan. Reasons can be voluntary or involuntary from the perspective of the beneficiary (see Table 1) and vary from changes in job status, eligibility, insurance offerings, and preference, to non-payment of premiums, to unawareness of pending coverage termination.

Table 1. Examples of
reasons for voluntary and involuntary disenrollment from a health plan

Voluntary Disenrollment Involuntary Disenrollment
Decided too expensive

Forgot to sign up

Decided to forego coverage

Lost eligibility

Newly eligible for public insurance

Couldn’t afford premiums

Moved

Passed away

Want a different network

Confused by application process

Unhappy with insurer

 

 A study by the Center for Healthcare Research and Transformation asked Michigan policyholders whether they continued with the same plan they held the previous year. 72% of those surveyed with employer-sponsored insurance (ESI) stayed on plan. 62% of Medicaid beneficiaries did. Only 47% of those who purchased coverage on the individual marketplace kept their plan the following year.

Implications for

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