What's going on in the state-based marketplaces?

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While enrollment in the ACA marketplace as a whole in the Open Enrollment Period for 2023 is on pace to finish about 13% higher than in OEP 2022, enrollment in the eighteen states that run state-based marketplaces (SBMs) is on course to come in about 3% below the OEP 2022 total.

As my last post emphasized, enrollment growth throughout the pandemic has been overwhelmingly concentrated in states that have refused to enact the ACA Medicaid expansion. In those states, about 40% of enrollees would be eligible for Medicaid if their states had enacted the expansion, and the American Rescue Plan Act made a benchmark silver plan free to almost all of them. As of this past week’s enrollment snapshot, enrollment in the twelve current nonexpansion states is up 23% year-over-year.

But enrollment in twenty-one expansion states that use the federal HealthCare.gov platform is also up by 10%. That throws the apparent enrollment decrease (barring last-minute surges or Week 9 reporting lags) in the SBMs into sharp relief and has marketplace watchers scratching their heads. (See the bottom of this post by Charles Gaba for breakouts of 2023 enrollment to date by exchange type.)

In fact, throughout the pandemic years, enrollment growth in the states currently running their own marketplaces has collectively lagged far behind growth in the overall market. Enrollment in these eighteen states is up 6% since OEP 2020, compared to 43% for the marketplace as a whole.

Nonexpansion states continue to power ACA enrollment growth

Open enrollment

Ever since ACA marketplace enrollment began rising during the Open Enrollment Period for 2021, enrollment growth has been concentrated in states that have refused to enact the ACA Medicaid expansion.  In nonexpansion states, eligibility for marketplace subsidies begins at an income of 100% of the Federal Poverty Level (FPL), compared to 138% FPL in expansion states, where Medicaid is available below that threshold.  

In OEP for 2021, enrollment increased by 10% in 14 nonexpansion states and marginally decreased, by 0.5%, in expansion states. In OEP for 2022, enrollment was up by 30.5% in 12 nonexpansion states, and up 11.5% in expansion states (Oklahoma and Missouri enacted the expansion in 2021).  Over two years, enrollment in the 12 states that still had not expanded as of OEP for 2022 was up 45.1%, compared to 27.0% for all states. Almost three quarters of all enrollment growth over those two years (73.3%) was in states that had not expanded Medicaid as of OEP for 2022. Nonexpansion states include the behemoths Florida and Texas, which together account for 31% of all marketplace enrollment (in 2022, 4.6 million out of 14.5 million total enrollees).

Now Charles Gaba reports that the pattern appears to be repeating during OEP for 2023, though there's a lot of unevenness and uncertainty in weekly reporting (e.g., the 18 state-based marketplaces, which all serve expansion states, have only reported through Nov. 27, versus Dec. 4 in HealthCare.gov states). With that caveat, enrollment appears to be up 26.7% in nonexpansion states and just 2.7% in expansion states.