Slow start to Open Enrollment 2019

The Democrats' capture of the House of Representatives has saved the ACA's core programs and funding. Most fundamentally, Republicans have lost their chance to cut the trillion-plus dollars over ten years in federal healthcare spending that they tried to cut last year -- most of it in Medicaid. Instead, the ACA's expanded Medicaid eligibility may be available in seven more states by 2020 than in 2018.  And the ACA marketplace's income-adjusted and relatively generous subsidies (compared to proposed Republican replacements) remain intact.

That said, early reports from Open Enrollment for 2019 suggest that various forms of Republican sabotage -- massive cuts to advertising and enrollment assistance, creation of a medically underwritten market in conjunction with repeal of the individual mandate -- may be taking their toll.  Enrollment on HealthCare.gov, the federal exchange serving 39 states, was down about 13% in the first week (adjusted for a one day difference in days open) and 8% in week 2.

That could mean nothing, or it could mean a lot. Enrollment could catch up with last year's (which was down 5% in hc.gov states from 2017 and 9% from 2016), or fall further behind. Charles Gaba chalks the slow start up to election distraction -- in the media if not for the public at large -- although, weighing all factors pro and con, he'd previously predicted a 5% drop this year. Former HealthCare.gov chief marketing officer Joshua Peck is less sanguine:

New Medicaid expansion + increased silver loading should improve ACA marketplace risk pools

Over the next couple of years, two forces will be at work to make ACA marketplace risk pools somewhat wealthier and therefore healthier -- even as other factors pull the other way.

The factors working to improve the risk pool are Medicaid expansion, which pulls the lowest income  enrollees out of the marketplace, and silver loading*, which creates discounts in bronze and gold plans that mainly benefit (and draw in) enrollees at the upper income range of subsidy eligibility (201-400% of the Federal Poverty Level).

At incomes below 201% FPL, the bronze/gold discounts for the most part are not valuable enough to offset the free, strong Cost Sharing Reduction subsidy available at that income level, and available only with silver plans. At 200-400% FPL, the discounts were attractive enough to offset factors inhibiting enrollment for 2018, such as the huge advertising and outreach cuts implemented by the Trump administration and confusion about repeal and the individual mandate. As I've noted before, compared to 2017 enrollment levels, 2018 enrollment  at 201-400% FPL outperformed enrollment below 201% FPL by about 8 percentage points. That in turn shifted the income distribution of exchange enrollees upwards a couple of percentage points:

Income distribution of subsidized enrollees: HealthCare.gov, 2017-2018

Year	Number enrolled at 0-200% FPL*	Percent enrolled at 0-200% FPL	No. enrolled at 201-400% FPL	Percent enrolled at 201-400% FPL
2017	5,507,246	59.8%	2,851,601	31.0%
2018	5,092,349	58.2%	2,891,851	33.0%

Source: Public Use Files (2018, 2017) published by CMS

Gold in Texas's broad empty spaces

A county is a flexible unit of demarcation, especially in the U.S. Los Angeles County (population 10 million) is 100,000 times larger than Loving County, Texas (pop. 95).

Insurance premiums in the individual market also vary wildly by geography, with county lines often (but not always) marking a rating area boundary. This may make sense from a business standpoint for commercial insurers, but it's a ridiculous principle for social policy. Living on the wrong side of a street can cost a person thousands of dollars.

Assessing the national ACA marketplace by county can create mistaken impressions. In the runup to Open Enrollment 2017, Republicans, ever eager to denigrate the marketplace, were crowing that one third of counties had only one insurer. That was true, but only 19% of enrollees (estimated prior to open enrollment) had a choice of just one insurer. That reflected market deterioration for sure, but 19% is not 31%.

Last year, when Trump cut off direct federal reimbursement for Cost Sharing Reduction (CSR) subsidies, most states and insurers coped  by loading the cost of  CSR into silver plans only, since CSR is available only in silver plans. Since premium subsidies vary by income and are keyed to a silver benchmark, this had the effect in many states and rating areas of creating large discounts for subsidized enrollees in bronze and gold plans. In some cases, gold plans were cheaper than benchmark silver for subsidized buyers. This windfall boosted enrollment at the upper income range of subsidy eligibility, where CSR is weak to nonexistent. Gold plan enrollment quadrupled in some states, and bronze enrollment rose from 23% of total enrollment in 2017 to 29% in 2018.

Plan offerings were finalized last fall shortly after Trump cut off CSR reimbursement in October. David Anderson swiftly and very usefully mapped out the effects of silver loading by county nationally,and he has done so again this year, when more states (almost all) have adopted silver loading.  The map shows broad areas where the gold plans are available for less than benchmark silver. That's the case in 1,136 counties in 2019, compared to 595 this year. On the map, counties with such anomalous gold pricing are marked in green -- the darker the green, the cheaper the gold relative to the benchmark.

There are counties and counties, however. David's map shows a sea of green in Texas, so I've been meaning for a while to check out the offerings.

ACA probably saved, along with democracy

Below, the gist of an email I sent to a local advocacy group I'm involved with, the BlueWaveNJ healthcare committee. Links added here.
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The election results are something of a Rorschach test for each of us, but the core fact is Dems taking the House and 6-7 governorships. The House win was not a certain thing by any stretch, -- and it means Republicans can't crush democracy, the rule of law....or the ACA. Or Medicaid. Or, next up, Medicare -- which Republicans still want to privatize. The U.S. healthcare system in all its dysfunctional glory has been spared massive despoilment.

While the fate of ACA rules guaranteeing access to individual market insurance for people with preexisting conditions drew all the passion, the battle over ACA repeal has always been fundamentally a funding battle - mainly over funding for Medicaid, which the Republican repeal bills would have cut by some $800 billion dollars. Overall, in 2017 Republicans tried to cut $1 trillion-plus in federal spending to provide access to affordable insurance, eviscerating ACA marketplace subsidies along with Medicaid. That appears to be off the table.  So do Republican plans to cut even more than that going forward (reflected in the 2019 House budget resolution).

Miracle on 45's Watch

On the downside, there's Republicans' multi-front assault on ACA programs and funding. On the upside, there's a health access miracle that we can ratify on Nov. 6 -- if the U.S. doesn't suffer a second straight electoral catastrophe. By way of pre-election encouragement today, I look at the bright side on healthinsurance.org

Silver loading 2019: What's on offer in the nation's highest-enrollment counties

The ACA marketplace is, as David Anderson says, a county-by-county story. Markets vary widely, or wildly, by location, sometimes down to the zip code. The variation grew positively freakish after Trump cut off CSR reimbursement and insurers responded by silver-loading -- that is, concentrating the cost of CSR in silver plans only (see below for an explanation).

There are counties (like Alfalfa in OK) where anyone with an income under 400% FPL can get a gold plan (deductible $200) for free, but where a 40 year old with an income just over the line will pay $433 per month for the cheapest bronze plan (deductible $5,000). There are counties where no one with an income over 200% FPL can get a silver plan with a deductible lower than $4,000 (Penobscot, Maine). There are counties where premiums for the unsubsidized are relatively low but silver loading has yielded no significant discounts in bronze or gold (Essex, NJ). There are counties where a large gap between the cheapest and benchmark (second cheapest) silver plan render CSR-enhanced free or close to it to most with CSR-eligible incomes, but with no affordable gold plans for those eligible for weak CSR or no CSR (Atkinson, Georgia).

This is all testament to the flawed design and inadequate funding of the ACA marketplace, as well as to the sabotage inflicted on it in the Trump era and prior. Compare Medicare/Medicare Advantage, where a monster public option, heavier and more uniform subsidies, tight constraints on provider payment rates in the private plans, and better benefit standardization create a market that's confusing enough and has large coverage gaps for many but still provides more uniform, adequate and affordable coverage than does the marketplace. (Though the marketplace actually offers more comprehensive coverage to those with incomes under 200% FPL who access CSR.)

All that said, there's a sort of broad middle of silver loading effect, in which bronze and gold plans are cheaper relative to silver than they were pre-2018. For a solo 40 year-old with an income of $24,000, or a bit under 200% FPL, a mid-range silver load effect might create a spread of over $100 per month between the cheapest bronze plan and benchmark silver ($129 per month at this income) and of less than $30 per month between the benchmark and the cheapest gold plan, i.e. up to around $160/month.

Bob Hugin, healthcare moderate?

I doubt it. The Republican candidate for Bob Menendez's New Jersey Senate seat, the past finance chair for Trump's New Jersey campaign, makes moderate noises about healthcare under cover of technocratic blather like paying for value and providing "health care, not sick care.". Someone needs to look beneath the hood and get him on the record as to what extent he'd support Republican healthcare priorities. In the North Jersey Record, I've posed some healthcare questions for him.

Hope you'll take a look: 3 healthcare questions for Bob Hugin

P.S. A more detailed look, with more background and a question about VA care, is here on the blog.

CMS guidance on ACA innovation waivers requires an ACA-compliant benchmark

The Trump administration has opened a new front in its assault on the ACA marketplace's protections for people with pre-existing conditions. This time the vehicle is the ACA's Section 1332 innovation waivers, which enable states to propose alternatives to the ACA's basic marketplace architecture to get their residents covered with affordable, comprehensive insurance.

In guidance issued this week, CMS relaxed strict standards that states have until now had to meet to get waiver proposals approved. Most radically, the new guidelines are designed to enable states to offer subsidies for ACA non-compliant plans, including short-term plans that are medically underwritten and don't have to cover the ACA's Essential Health Benefits.

Subsidizing noncompliant, medically underwritten health plans would seem to be a route to undermine the ACA-compliant market completely -- and potentially render comprehensive coverage unaffordable for subsidized as well as unsubsidized enrollees, especially those with pre-existing conditions.  But I suspect the guidance doesn't go quite as far as it seems to in this regard.  Some constraints on rendering comprehensive insurance unaffordable remain, I'll suggest below -- at least for subsidized enrollees.

Republicans have already undercut ACA protections for people with pre-existing conditions

As Republicans who voted for last year's ACA repeal bills in the House and Senate profess now that they are committed to protecting insurance access for people with preexisting conditions, it's important to keep in mind a current fact of life that both complicates and clarifies what they tried to do in those bills and the harm those bills would have wrought.

It's this: Republicans have already adulterated the ACA's individual market protections for people with preexisting conditions by means comparable to those stipulated in the House bill, the American Health Care Act (AHCA), and in the Senate bill, the Better Care Reconciliation Act (BCRA).

The AHCA nominally retained the ACA's core protections -- guaranteed issue, modified community rating, and the Essential Health Benefits that each plan must provide. But once adorned with the MacArthur Amendment that made passage possible, the bill enabled states to obtain waivers that allowed insurers to medically underwrite policies offered to people who had experienced a gap in coverage. States could also write their own EHBs. Critics pointed out that once a medically underwritten market was established, healthy people would opt in, leaving the ACA-compliant market to the sick and so driving up premiums. Rewritten EHBs could make mincemeat of caps on yearly out-of-pocket spending, as those caps apply only to services covered by EHBs.

In which Larry Levitt highlights the missing link in our fevered debate over preexisting conditions

This nineteen month old tweet, posted as House Republicans were poised to release the first iteration of their ACA repeal bill, made a lasting impression on me:

When #ACA replacement bill is out, don't get distracted by exchanges.

The big issue is dramatic cuts in Medicaid to pay for huge tax cuts.

— Andy Slavitt (@ASlavitt) March 6, 2017

As the repeal attempts are re-litigated this election season (and threatened for next year if Republicans retain control of Congress),  I've noted again and again that the fight over who would protect access to insurance for people with pre-existing conditions is obscuring the more fundamental fight over government funding  for public healthcare programs -- primarily for Medicaid, but also for affordable access in the individual market.