Milliman Inc. has released a brief examining the impact of health plan benefit changes under health reform on health service cost and utilization.  The brief explains the law's essential benefits requirements as well as the system health reform establishes to rate plans offered in the law's health exchanges.  The authors caution the need for insurers to prepare for increased health service utilization under health reform, and suggest that insurers must devise means to properly allocate risk in order to avoide adverse selection.

From the report:

The Patient Protection and Affordable Care Act (PPACA) mandates changes to health insurance products if they are to be sold through an exchange starting in 2014.  For products to be included inside the exchange, they must meet or exceed the minimum requirements for one of the bronze, silver, gold, or platinum plans based upon their "actuarial equivalence."  As well, products must cover a series of mandated "essential"benefits.  Some changes, such as providing preventive care with no cost sharing, apply to all plans, not just those sold through the exchange, and have already gone into effect.  These benefit design changes will not only affect insurer cost because of changes in member cost sharing, but in fact may result in several other consequences- most notably changes in utilization by members as they respond to new plan designs.

Full report: Health Exchanges: Impact of Health Plan Benefit Changes on Cost and Utilization (PDF | 94 KB)

Milliman Inc.  (2011).  Health exchanges: impact of health plan benefit changes on cost and utilization.  van der Hejide, M. and Norris, D.