What kinds of health plans are people buying outside the ACA marketplace? An eHealth snapshot

In estimating the weighted average actuarial value of health plans sold in the entire U.S. individual market last Friday (spoiler: AV 75%), my proxy for the off-exchange market was the 1.4 million HealthCare.gov enrollees who did not qualify for subsidies. Here's the score:

Actuarial value obtained by unsubsidized enrollees on HealthCare.gov

Actuarial Value	% of unsubsidized enrollees
90 (Platinum)	3.3
80 (Gold))	18.5
70 (Silver)	39.0
60 (Bronze)	33.0
57 (Catastrophic)	6.8
68.9% (weighted avg)

There are probably 7 to 8 million enrollees in ACA-compliant off-exchange plans, and assuming that the unsubsidized Hc.gov population reflects their choices is something of a leap, as I acknowledged. But here is a second data set: last December eHealth, the largest commercial online health insurance broker (pre-dating ACA implementation) broke out metal level selection among its unsubsidized enrollees in the first two weeks of open enrollment for 2016. The "last year" comparison in each line is to the first two weeks of open enrollment 2015. The results:

Plan selection by metal level (individual and family plans combined)*:

• 4% selected platinum plans, compared to 7% last year
• 13% selected gold plans, compared to 15% last year
• 32% selected silver plans, compared to 24% last year
• 43% selected bronze plans, compared to 46% last year
• 9% selected catastrophic plans, compared to 9% last year

That's a weighted average AV of 67.3% -- fairly comparable to the unsubsidized exchange enrollee average. Some notes and caveats:

1. The sample size is small. eHealth enrolled about 500,000 people in individual market plans in 2016, and this sample comes from just the first two weeks of open enrollment.

2. The sampling is modestly younger than the overall marketplace population: 33% were aged 18-34, vs. 28% in the marketplace. That's reflected in the high percentage of catastrophic plan purchases. Catastrophic plans are available only to buyers under 30 and older buyers who qualify for a hardship exemption.

3. Early buyers might somewhat sicker than later buyers -- hence the full-year percentages, which eHealth will release later this month, may have lower average AV.

4. This sampling includes enrollees in ACA-compliant plans that are not available on the exchanges, which are more expensive on average, according to a June 2014 study by HealthPocket:

The study examined the lowest available premiums for silver plans in the most populous cities in 39 states and found that on average the least expensive silver plan offered by the four off-exchange insurers were 39% more expensive than the silver plans with the lowest monthly premiums on-exchange. 

5. eHealth's customer base may not particularly reflect the overall off-marketplace population.

All that said, perhaps the results a) modestly reinforce the premise that unsubsidized enrollees on HealthCare.gov are a reasonable proxy for the off-marketplace individual market, but b) also suggest that average AV among the marketplace unsubsidized may be somewhat higher than among off-exchange buyers.

As mentioned above, eHealth expects to update this snapshot by month's end, so perhaps I'l have cause to update as well.