ACA enrollment gains in OE 2022 may just consolidate gains from the emergency SEP

CMS's Week 5 snapshot of ACA marketplace enrollment during the Open Enrollment season for 2022 shows an all-state enrollment increase of 8.5% over Week 5 for 2021, according to Charles Gaba's calculation. (Gaba adjusts the growth rate reported by CMS to account for the fact that this year's data reflects 34 days of enrollment, vs. 35 days at this point last year.)

While extrapolations in mid-OE are always dicey, that rate of increase has held fairly steady, and I'll venture to point out that gains in this range would basically consolidate the large enrollment increases effectuated during this year's emergency Special Enrollment Period, which ran from February 15 to August 15 on HealthCare.gov, the federal exchange, and for varying extended periods on 15 state-based exchanges. The emergency SEP was essentially a second Open Enrollment period.

The enrollment gains during the current OE, as during the emergency SEP and OE for 2021, are heavily concentrated in states that have not enacted the ACA Medicaid expansion and have a consequent "coverage gap" - -that is, no subsidized health insurance available for most adults with incomes below 100% of the Federal Poverty Level, the threshold for marketplace subsidy eligibility.  As reflected in the table below, 72% of net enrollment gains nationally from February through August of this year were in the nonexpansion states (excluding Wisconsin, which offers Medicaid to adults with incomes up to 100% FPL and so has no coverage gap). For that reason, I have focused on the nonexpansion states to compare apparent enrollment gains at present with those logged in the emergency SEP.  

Premiums down, out-of-pocket costs up up up: The post-ARPA case for maximal silver loading

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I have repeatedly made the case that CMS should follow the lead of several states and mandate strict silver loading* in the ACA marketplace-- that is, require insurers to consistently price gold plans below silver plans, since the average actuarial value of silver plans is higher than the mandated AV for gold plans (80% -- i.e., the plan is designed to cover 80% of the average enrollee's costs). 

In recent posts, I have spotlighted New Mexico's maximized mandatory silver loading: in 2022, the state required insurers to price silver plans as platinum-equivalent, since silver plans are platinum-equivalent for enrollees with incomes below 200% FPL ($25,7600 for an individual in 2022).  The regulation is designed to be a self-fulfilling prophecy: if gold plans are priced well below silver, no one with an income over 200% FPL should buy silver plans.  In 2022, gold plans are in fact priced well below silver plans throughout New Mexico.

Since silver loading began in 2018, the main case for maximizing it has simply been that the ACA marketplace has always been under-subsidized, and a state or CMS can alleviate high enrollee costs without help from Congress. That case may appear less urgent after the American Rescue Plan Act (ARPA), enacted this past March, sharply increased premium subsidies. The draft Build Back Better bill would extend those subsidy boosts through 2025.

But the case for strict silver loading remains strong. While ARPA reduced premiums, it did not reduce out-of-pocket costs, and these have risen relentlessly at each metal level, driven by medical inflation, which is always higher in the commercial market.  Strict silver loading is a way to roll back that rise for enrollees with incomes above 200% FPL; it's a kind of back-door CSR for enrollees above that income level. (Moreover, the BBB bill is not a done deal, 2025 is not the end of time, and strict silver loading would mitigate a far-from-unlikely expiration of the subsidy boost.)

Open enrollment 2022! Marketplace loaded for bear, but bear traps remain

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Open enrollment in the ACA marketplace begins tomorrow. This will be the first OE season - -and hopefully, not the last - -in which the enhanced subsidies created by the American Rescue Plan (ARPA) are in place. It's a season of hope -- and also worry. Some thoughts below.

1. All systems go? The marketplace, which never reached half the enrollment projected by CBO in 2010, is in some senses loaded for bear this fall. Thanks to ARPA, silver plans with strong Cost Sharing Reduction (CSR) are now free for people with incomes up to 150% FPL ($19,320 for an individual); cost no more than 2% of income at incomes up to 200% FPL; and cost no more than 8.5% of income (without CSR) for any enrollee who lacks access to other affordable insurance. 

Navigator organizations, which operated on a shoestring (if at all) during the Trump years, their federal funding cut from $63 million in 2016 to $10 million in 2018 and years following, have been granted $80 million for 2022. Florida's chief navigator organization, Florida Covering Kids and Families, started with 120 navigators in 2013 but was down to 50 in OE for 2020, with just 25 in the off-season. This OE, they've got 200 navigators in place. (Federal navigator funding, derived from user fees charged to insurers selling in the marketplace, only applies to the 33 states still using HealthCare.gov, the federal exchange. State exchanges fund their own outreach through user fees they retain.)