2023: Understanding a maturing ACA marketplace

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Not exactly New Year's fireworks, but the closest equivalent in my photos

Another blogging year goes to the archives. As the years go by it seems I write fewer and fewer posts and spend more and more time on each of them. I’d like to think that means the posts are getting better, but I wouldn’t swear to it.

Perhaps it’s fair to say my understanding of the ACA marketplace is maturing as the marketplace matures. A few themes in this year’s posting flesh that idea out:

• I have long been concerned with CSR takeup — that is, how many low-income enrollees (that is, a majority of marketplace enrollees) obtain coverage that makes actual care affordable. Since ARPA rendered at least two CSR-enhanced silver plans free for enrollees with income up to 150% FPL and available for no more than 2% of income for those in the 150-200% FPL income range, I have been disappointed to note that silver plan selection at low incomes has not improved as I anticipated, and this March I noted that CSR takeup went backwards in 2023. I then added a spotlight on CSR takeup in states that have not expanded Medicaid, where the vast bulk of enrollees eligible for free CSR silver live. Perhaps more interestingly, following hints from brokers and those who work with them, I examined markets in which some enrollees might have cause to forgo the CSR benefit with eyes wide open, sacrificing low out-of-pocket costs to obtain a more robust provider network or other benefits.

• Since late 2013, I have followed the development of Direct Enrollment and Enhanced Direct Enrollment (DE and EDE) provided by commercial platforms selling ACA marketplace plans. This year, I gave full attention to the fact that most ACA marketplace enrollments are broker-assisted, and that most broker-assisted enrollments are executed via DE or EDE (probably mostly the latter by now). While I have paid much attention over the years to the usability and presentation of vital information on HealthCare.gov and the state exchanges, this year I looked at where and how ACA marketplace enrollments actually happen, spotlighting the fact that many and probably most marketplace enrollees never visit a government-operated exchange.

• DE and EDE are only possible in states that use the federal exchange, HealthCare.gov, though that is poised to change in coming years. Given the centrality of brokers to marketplace enrollment, and brokers’ heavy reliance on EDE platforms where available, the lack of DE/EDE in state marketplaces may be a contributing factor in lagging enrollment growth in SBM states in the pandemic years. On the other hand, slow growth in the SBM states since 2020 may be chiefly due to better penetration and lower uninsured rates in prior years, along with other demographic factors.

This year I also spotlighted a marketplace abuse apparently unique to New Jersey: insurers in the state were presuming marketplace enrollees over age 65 eligible for Medicare unless they proved otherwise, and acting as a secondary payer (while collecting full premium) in the absence of such proof. In response to my query, CMS pointed me to guidance issued in May 2023 stating unequivocally that this presumption of Medicare eligibility was impermissible. Stonewalled on this obvious violation of the ACA statute by New Jersey’s Department of Banking and Insurance, I enlisted the help of nj.com reporter Karen Price Mueller, whose inquiry prompted DOBI to issue a directive to insurers telling them to cease and desist from this practice (which had been codified in the state’s standard individual market contracts in 2023 and permitted since at least 2016). DOBI had previously acknowledged that the CMS guidance must be followed but apparently had not acted to end the practice in 2023. Mueller’s article, spotlighting the plight of a friend of mine subjected to this abuse of the spirit and letter of the ACA, is paywalled, but quoted at some length in my followup post. DOBI has also removed the presumption of Medicare eligibility for over-65 enrollees from the 2024 standard contracts.

Also this year, I took a look at the possible effect of the FTC’s proposed ban on noncompete clauses in employment contracts on the growth of private equity ownership of physician practices and other medical services and facilities, which has been galloping apace. I also delved into a battleground in Medicare Advantage payment, the industry’s apparent exploitation of risk adjustment to inflate payment. On this score I interviewed Richard Kronick, a leading critic of current risk adjustment practice.

Coming soon are what look to be blockbuster enrollment totals for the ACA marketplace in 2024. Marketplace growth in the last three years is poignant for those of us worried about the prospects for extending the improved subsidies temporarily implemented by the American Rescue Plan Act beyond 2025. Flawed as the ACA marketplace is, under the ARPA subsidy schedule (extended through 2025 by the Inflation Reduction Act) has staked a fair claim to fulfilling its creators’ intent and CBO’s initial predictions. That progress is at risk in 2025. Then again, so is American democracy and almost everything we hold dear.