Question

What implications does Adverse Selection have on Medicare, the private individual market, the employer-sponsored market, consumer-directed health plans, and even the ACA?

Answer 1

Adverse selection in the health insurance program for a high-risk individual that guides for making insurance selection. In adverse selection, Medicare prescription drugs plans benefit from coverage gap and adopt alternate designs and programs and exchange plans under ACA. In advantage, private plans provide coverage for seniors, disabled people as a fee for service Medicare. it covers parts A and B of traditional medicare. (a-inpatient service, b- outpatient service)In advantage beneficiary, it increased the scope of benefits and cost-sharing amounts.
The private individual markets that individuals purchase health insurance directly and it is not offered by federal and state governments. Under the Affordable care act, it benefits retired, unemployed, self-employed, young and older adults health insurance help with pre-existing conditions when other coverage so expensive that can not afford for taking service.
  Employer-sponsored market to provide health plans at lower premiums with high-cost effectiveness and lower the tax income
Consumer-directed health plans have a tax advantage with high deductible increase consumer benefits in health care spending. it covers some basic health services like prescriptions and visons with fewer costs.
Health insurance exchanges under the Affordable care Act provide a favorable enrollment pattern. Adverse selection makes many new problems for health plan profitability and beneficiaries to have health plans. ACA limits the adverse selection behavior by making the individual enroll in health, low-cost members contribution premiums, limit the high cost for health service, it increases the coverage cost of the premium for beneficiaries with a high-risk individual with drug abuse, alcohol, smoking, and chronic disease. ACA provides a guarantee to the individual to receive comprehensive insurance for their pre-existing condition.