Unsubsidized ACA marketplace enrollees drop out early

Early this week, CMS reported that unsubsidized enrollment in ACA-compliant plans dropped 20% in 2018, while subsidized enrollment dropped just 3%. I pointed out that on-exchange unsubsidized enrollment dropped much more modestly, just 6%. That bespeaks a still steeper drop in off-exchange enrollment, suggesting that some previous off-exchange enrollees may have moved on-exchange in 2018 -- some obtaining subsidies, others not.

Today Charles Gaba notes that while unsubsidized on-exchange enrollment did not drop precipitously this year, first-month attrition among the unsubsidized who enrolled on-exchange was massive -- in a year in which overall attrition appears lighter than usual (over 80% of on-exchange enrollees are subsidized). While only 5.6% of subsidized enrollees are reported to have dropped coverage as March 15, 29%* of unsubsidized enrollees did.  This may not be surprising in a year in which premiums rose an average of 27%, largely as a result of Republican sabotage (cutoff of direct CSR reimbursement, radical cuts in enrollment assistance and advertising, weak enforcement of the individual mandate).

While the attrition among the unsubsidized this year is startling, it continues a pattern. Far higher percentages of unsubsidized than subsidized enrollees also dropped out in 2017 and 2016, rising each year. At the same time, attrition among subsidized enrollees dropped each year.

Below are the first-quarter attrition figures for 2015 through 2018. One large caveat is in order for 2017. In that year, Open Enrollment ended on 1/31, and CMS reported effectuated enrollment as of 3/15 -- that is, effectuated in February. Approximately 500,000 people enrolled after 1/15, however, and their first payment was not due until March 1.  Gaba has adjusted his estimates accordingly, and I include his estimates in parentheses in that year. [Update, 8/26/18: I have accounted more precisely for the 2017  enrollees whose first premium was due in March, as explained in this post, estimating an additional 76,000 unsubsidized and 401,000 subsidized effectuated in March.]

First Quarter Enrollment Attrition in the ACA Marketplace

2018

Financial status	Enrolled as of 12/15/17	Effectuated Feb (as of 3/15)	Change
With APTC*	9,762,104	9,229,769	- 5.4%
Without APTC	1,988,071	1,414,017	-28.9%

* APTC = "advanced premium tax credits." Each year, a small number enrollees receive a second subsidy, Cost Sharing Reduction, without receiving APTC.

2017

Financial status	Enrolled as of 1/31/17	Effectuated as of 3/15 (March estimated)	Change
With APTC	10,100,808	9,107,757	- 9.8%
Without APTC	2,115,195	1,699,002	-19.7%

*Those who enrolled from 1/15-1/31 could not effectuate coverage until March 1. Thus up to 500,000 late enrollees are not included in the 3/15 "effectuated enrollment total.

2016

Financial status	Enrolled as of 2/1/16	Effectuated March (as of 3/31/16)	Change
With APTC	10,510,141	9,389,609	-10.7%
Without APTC	2,088,385*	1,691,721	-19.0%

* The 2016 report includes 83,516 of unknown subsidy status.

2015

Financial status	Enrolled as of 2/22/15	Effectuated  (as of 3/31/15)	Change
With APTC	9,941,820	8,656,210	-12.9%
Without APTC	1,682,145	1,530,987	- 8.9%

From 2015 through 2018, attrition for the unsubsidized grows every year, and the gap between subsidized and unsubsidized also grows, as retention among the subsidized improves. There is a huge jump in unsubsidized attrition in 2016, a year in which premium increases were fairly modest. While that is difficult to explain, the steady rise in attrition among the unsubsidized in subsequent years is likely due to increasing and accumulating premium growth.

--
In the 2018 PUF, there is an apparent error in the tally for subsidized enrollment in Idaho - -it looks to be about 20,000 too low, in light of norms and of the effectuated enrollment tally. Gaba accordingly adjusted unsubsidized attrition down slightly, and subsidized attrition up.

Sources
2015 March enrollment report
2015 effectuated enrollment snapshot as of 3/31

2016 final enrollment report
2016 effectuated enrollment snapshot as of 3/31

2017 Public Use Files
2017 effectuated enrollment snapshot as of 3/15

2018 Public Use Files
2018 effectuated enrollment snapshot



















2015 effectuated
https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-06-02.html
2016 effectuated
https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2016-Fact-sheets-items/2016-06-30.html
2017 effectuated
https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2017-Fact-Sheet-items/2017-03-15.html


2015 final
https://aspe.hhs.gov/system/files/pdf/83656/ib_2015mar_enrollment.pdf
2016 final
https://aspe.hhs.gov/health-insurance-marketplaces-2016-open-enrollment-period-final-enrollment-report
2017 final
https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2017-Fact-Sheet-items/2017-03-15.html