Notes from the SEP: On record marketplace enrollment in August 2021

Subscribe to xpostfactoid

CMS today released a final enrollment report for the emergency Special Enrollment Period that ran in HealthCare.gov states from Feb. 15--Aug. 15 this year, and for mostly comparable lengths in the 15 state-based marketplaces. 

The top line: 2.8 million new enrollments nationally in that period. A few quick notes:

1. Effectuated enrollment in August 2021, 12,199,393, is up 14.6% over 2020, the previous high (10,642,088*), and 22% over enrollment in August 2016, the peak prior to 2020.  Caveat: off-exchange enrollment in ACA-compliant plans dropped by about 3 million from 2016 to 2019, according to KFF estimates. On-exchange enrollment is about 2.2 million above the August 2016 total.
   
   
2. While 2.8 million people newly enrolled in marketplace coverage during the SEP, total enrollment has risen by only 900,000 since February, when effectuated enrollment stood at 11.3 million.  That's steeper attrition than I anticipated when I estimated total enrollment at 12.7 million through July.
   
   

Dropping the Medicare age to 60 also requires...

Subscribe to xpostfactoid

130 House Democrats have co-sponsored a bill introduced on September 3 by Pramila Jayapal, the Improving Medicare Coverage Act, that would drop the Medicare eligibility age to 60 -- simply and cleanly, with Medicare offered on the same terms at age 60 as it now is at age 65, within six months of enactment. That's the headline. But the bill does something else that's arguably more consequential. 

Without other changes to Medicare, dropping the eligibility age to 60 would be a mixed blessing at best. That's because for 60-64 year-olds with income below 200% of the Federal Poverty Level ($25,520 for an individual, $34,480 for a couple in 2021), Medicare in its current form would be considerably more expensive than ACA marketplace coverage (as enhanced through 2022 by the American Rescue Plan Act in enacted in March) -- excepting for those who are dually eligible for Medicaid and Medicare. While just over a quarter of the U.S. population is in households with incomes below 200% FPL, about half of the uninsured have incomes below that threshold.  

Jayapal's bill changes the equation by making all Medicare enrollees with income below 200% FPL eligible for a new Medicare Cost Assistance Program that would zero out premiums, coinsurance and deductibles for Medicare Parts A (hospital)  and B (physician and outpatient), and also subsidize Part D prescription drug coverage (covering the entire Part D premium and reducing prescription copays to single-digit dollar amounts).  The bill would also move administration of these benefits from state Medicaid programs to Medicare, with the federal government assuming 100% of costs now shared with states.

Viewing the uninsured rate through foggy lenses

Subscribe to xpostfactoid

Snapshots of the health insurance status of the U.S. population are blurry.

When you look at the CMS tally of Medicaid enrollment increase since the pandemic struck, it seems, simply, that the increase swamps most estimates of the number of people that lost employer-sponsored insurance. Other factors are at work, of course. But the one large number is considerably larger than the other large number.

But official Medicaid enrollment totals may not be an entirely reliable measure of how many people are actually covered by Medicaid, and know themselves as such -- particularly during this pandemic, when disenrollments have been paused since March 2020. State Medicaid agencies are, to varying extents, blind beasts.

I know a young man who, during a year of transition, lived in two states and worked at three jobs, with a period of unemployment. At different points in the year he applied for Medicaid in two (blue) states and received rejection notices. From both of those states, months later (and months apart), while insured through his employer, he was sent managed Medicaid membership cards and informed that he'd be enrolled since shortly after his application was completed.  In both states, it took some doing and some time to get himself disenrolled.

How will Medicare enhancement change the current public-private Medicare ecosystem?

Subscribe to xpostfactoid

Democrats' aspirations to add dental, hearing and vision benefits to Medicare raises questions about the interactions between tradition, fee-for service (FFS) Medicare, Medicare Advantage (MA), and Medigap. These center on MA's growing market share, its funding mechanism, the gaps in FFS Medicare coverage that MA plans partially fill, and the value of Medigap for those who can afford it (or whose employers fund it).

Below, a brief outline (distilled mainly from KFF briefs) of how the three programs (FFS, MA and Medigap) interact/compete at present, followed by questions about how pending legislation may alter the ecosystem.

NHIS: No shift from private to public insurance?

Subscribe to xpostfactoid

The annual early release estimates from the National Health Interview Survey (NHIS) came out today. The NHIS recorded a decrease in the uninsured rate for all ages from 2019 to 2020, from 10.3% to 9.7%, but deemed the change statistically insignificant. Among adults aged 18-64, the uninsured rate  dropped from 14.7% to 13.9% -- also deemed not significant. Similarly, the Urban Institute survey report that I wrote about last week found essentially no change in the uninsured rate from March 2019 to April 2021 -- but also recorded a statistically insignificant drop. 

Directionally, as I noted last week, most surveys, including the Census's experimental Household Pulse Survey, point to a modest drop in the uninsured population during the pandemic. Big picture: huge gains in Medicaid enrollment, driven largely by a pause in disenrollments effectively mandated by pandemic relief legislation, appear to have outstripped drops in access to employer-sponsored insurance (ESI), which according to various sources fell less than the massive job losses triggered by the pandemic might have led one to expect. But there are a lot of moving parts that may have canceled one another out. 

Is the uninsured rate flat since 2019, or down a bit?

Subscribe to xpostfactoid

See 8/31 update from NHIS survey at bottom

The Urban Institute, in an analysis of results from its own ongoing Heath Reform Monitoring Survey, found that the uninsured rate among adults aged 19-64 did not change significantly from March 2019 to April 2021. 

That's at least a backhanded tribute to the U.S.'s kludgy health insurance safety net as bolstered by the Affordable Care Act. Big picture: in Urban's estimate, as a result of the pandemic, employer-sponsored insurance  fell by 3 percentage points (from 65% to 62.3%) in the survey period, while insurance through public programs (mainly Medicaid) increased by 4 percentage points (from 13.6% to 17.5%). 

You could read these results as a paean to the ACA Medicaid expansion (which Republicans almost repealed in 2017). In states that have expanded Medicaid, Urban found that the uninsured rate actually dropped two percentage points for people with incomes below 138% FPL, the Medicaid eligibility threshold. According to CMS, total Medicaid enrollment (including children) increased by 11 million -- 15.6% -- from February 2020 to March 2021.  Enrollment among adults rendered eligible by the expansion increased by about double that rate.

Urban recorded a much more modest and ambiguous impact for the ACA marketplace -- though the huge enrollment surge during the emergency Special Enrollment Period open from February 15 through August 15 of this year, turbo-charged by subsidy increases enacted in the American Rescue Plan, which appeared on HealthCare.gov on April, was mainly missed by Urban's study period. I'll return to that in a bit.

I speculated in May that the U.S. uninsurance rate might be at an all-time low, powered by huge gains in Medicaid enrollment, significant gains in marketplace enrollment, and relatively modest losses in employer-sponsored insurance during the pandemic. My methods (and math) are far less sophisticated than Urban's, and this is not to question their results (no source ever has a really complete picture of insurance in the U.S.).  That said, a few comments and caveats below.

What's the effect of a gold benchmark in the ACA marketplace? Three states tell a tale. And a platinum benchmark is coming.

Subscribe to xpostfactoid

Bloomberg's Sara Hansard reports that six states have now taken action to require insurers in their ACA marketplaces to price plans in strict proportion to their actuarial value -- that is, to increase the effects of silver loading. (Actuarial value (AV) refers to the percentage of the average enrollees costs the plan is designed to cover, in percentages fixed by metal level.)

Maryland, Pennsylvania and Virginia required strict silver loading in 2021 (and some or all in years prior). New Mexico and Colorado have new regulations going into effect in 2022. Texas has passed a law requiring the state insurance commissioner to take the value of Cost Sharing Reduction (added to silver plans only) into account during rate review.

Silver loading as mandated in Maryland, Pennsylvania and Virginia makes gold plans at least marginally cheaper than silver plans, increasing value for enrollees with incomes above 200% of the Federal Poverty Level ($25,520 for an individual in 2021). Below that income threshold, Cost Sharing Reduction (CSR) raises the actuarial value of silver plans to a roughly platinum level.

On staying out of the coverage gap: expert advice

Subscribe to xpostfactoid

I have a post up on healthinsurance.org addressing a subject near my heart: how to help more people avoid the "coverage gap" in states that have refused to enact the ACA Medicaid expansion.  That is, how to avoid being denied any help paying by estimating next year's income at a level below 100% of the Federal Poverty Level.

Eligibility for subsidized coverage (now free at incomes in the 100-150% FPL range, e.g., for anyone just over the eligibility threshold) is based on an estimate of next year's income. A lot of variables go into such estimates, especially for people with low incomes, who are often self-employed or work variable and unpredictable hours, or rely on tips, or do seasonal work. In this piece, brokers and enrollment counselors who have been at work since the ACA marketplace launched explain in detail how to maximize a good-faith estimate when necessary.

In many, many cases, failing to qualify for subsidized coverage is a matter of ignorance. The application does not tell you that there's a minimum income threshold you need to cross. Accordingly, the first step in helping low-income people seeking coverage is to spell out the minimum qualifying income:

This point can't be emphasized enough, according to Shelli Quenga Director of Programs at the Palmetto Project, a nonprofit health insurance brokerage in South Carolina.  "You need to know what amount you're shooting for," Quenga says. "You need to know where that line is. HealthCare.gov does not tell you."

Paradoxically, the application does recognize income uncertainty, and in fact positively invites applicants to take it into account:

Total marketplace enrollment likely approaches 13 million

Subscribe to xpostfactoid

Axios reports that Vice President Harris will announce today that more than 2.5 million people have signed up for marketplace coverage during the emergency Special Enrollment Period that began on February 15 and ends on August 15. (Yesterday, Charles Gaba estimated 2.57 million total SEP enrollments as of July 31.) [Update: CMS's SEP report through July 31 is out and cites the 2.5 million total.]

Just for fun, let's take a stab on where total marketplace enrollment likely stands right now. 

We know that effectuated enrollment totaled 11,290,546 in February, and that about 2.5 million additional enrollees have been logged since then. The wild card is disenrollments during those months. To estimate them, our best hints come from monthly enrollment tallies in 2020, recorded in the effectuated enrollment snapshot for February 2021.

Maximizing the ACA Innovation Waiver: Biosimilar silver loading, anyone?

Subscribe to xpostfactoid

Ask, and it shall be given

The advocates for more affordable health insurance at Families USA are asking the Biden administration to loosen up the Catch-22 that confronts states seeking to take advantage of the ACA's section 1332 innovation waivers.

1332 waivers enable states to propose alterations to virtually every feature of the ACA marketplace in pursuit of more affordable and effective coverage. The alternative scheme must cover at least as many people at least as comprehensively as the existing marketplace, and must do so without increasing the federal deficit. 

As currently interpreted, the deficit-neutral requirement presents a Catch-22: if the state's alternative scheme ends up costing more because more people sign up, the state is responsible for the excess costs, even if the coverage costs less (or no more) per person than the exiting ACA marketplace.