With the public online marketplace largely forced to process paper-based health insurance applications until widespread technical glitches are fixed, the HIX model has been demonized as never before.

But this unfortunate turn of events may not be as disastrous as it seems. In fact, the offline approach can establish a much-needed comfort level as consumers navigate their way through this sea change in U.S. health care delivery.

Manual processes, no doubt, involve considerable time and expense, but they also “offer a measure of safety” for both applicants and recipients, explains Robert Booz a health care industry analyst with Gartner. He says paper applications capture enrollment information for processing resolution and provide an accurate audit trail of activities taken during the process.

“Health organizations can track receipt, processing, finalization, duplicate checking, etc., from a single source,” according to Booz. “When there is doubt about establishing and tracking an electronic process, a paper copy gives a complete picture usually unaffected by computer malfunctions.”

Another point is that “this tactile single source of truth” also addresses concerns by applicants that they have completed their part of the submission process,” he says. “It is their copy of what they created to receive benefits and subsidies. It can validate future discrepancies in the records caused by computer or system breakdown.”

Critics, however, argue that the nascent online marketplace’s growing pains not only spotlight the federal government’s inefficiency and incompetence, but also spell trouble for the first HIX enrollment.

Healthcare.gov’s registration requirement created massive cyber traffic jams that slowed processing times and frustrated would-be shoppers, according to Rob Wilson, president of Employco, USA, which offers HR solutions to small and midsize employers. His belief is that requiring users to apply before shopping on the exchanges hides the true cost of their health insurance options.

“Paper is slowing down the process,” he says. Wilson adds that system glitches have caused the public exchanges to send inaccurate data to insurance companies, which are forced to review the entire process with each applicant by telephone.

Regardless of what has transpired so far and who is to blame for the rocky start in HIX enrollment, it still may be too early to gauge all of the ramifications. Just ask Catherine Teare, senior program officer, health reform and public programs for the California HealthCare Foundation, one of eight such organizations that support Enroll UX 2014, a public-private partnership organized to streamline online insurance shopping.

“It’s impossible to know at this point” the extent to which the significant reliance on paper applications during the first few weeks of public HIX open enrollment ultimately will slow the six-month process among other concerns, she says. “Certainly, paper applications will generally take longer than functioning online applications, and accuracy has overall been shown to be greater in electronic applications, but the magnitude of the effect can’t really be estimated at this point.”

Teare fears that the difficulty associated with processing online applications could deter younger and healthier consumers who become less motivated to sign up. An estimated 2.7 million of the 7 million Americans expected to seek HIX coverage for 2014 need to fit this description to dampen anxiety about adverse selection.

“I can’t predict the size of this effect, particularly in such a fluid environment,” she observes. “The federal and state exchanges should report on the volume and disposition of applications through every enrollment channel.”

HR departments, meanwhile, can expect to have their hands full in the coming weeks. Booze predicts larger firms will help employees who are uncertain about their benefits and concerned about group coverage being terminated and being steered into public exchanges. The smallest employers that often do not even have an HR staffer “will be the most subject to questions because their employees will likely fall into the effected eligible population and will lack coverage,” he says.

Public exchanges also are draining productivity across the workforce – not just in HR departments that are forced to field inquiries from confused and worried employee. Many of Wilson’s clients report that employees have logged on to the exchanges while at work to compare HIX options with their employer-provided coverage.

Shutan is a Los Angeles freelance writer.

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