ACA Marketplace in 2024: low-income enrollment up, silver plan selection down

Note: All xpostfactoid subscriptions are now through Substack alone (still free), though I will continue to cross-post on this site. If you're not subscribed, please visit xpostfactoid on Substack and sign up. 

CMS has published its 2024 Marketplace Open Enrollment Period Public Use Files, providing detailed breakouts of enrollment by income, metal level selection, demographics, etc.

We already knew that enrollment increased by 31% nationally this year, spurred in part by the Medicaid unwinding — that is, the resumption of Medicaid redeterminations and disenrollments after a three-year pandemic-induced moratorium. While there’s always much to explore in the PUFs, two facts jump off the page for me:

• Enrollment growth was heavily concentrated at low incomes — up 61% at 100-138% FPL and 54% in the slightly broader 100-150% FPL bracket. That’s perhaps not surprising, given that CMS announced that 2.4 million Medicaid disenrollees had enrolled in the 32 states using the federal platform, HealthCare.gov (and perhaps 2.9 million nationally, by Charles Gaba’s estimate). Year-round enrollment at incomes up to 150% FPL has likely also boosted enrollment in this bracket [added 3/23/24].

• The decline in silver plan selection at low incomes that I flagged last March has continued. That is, growing numbers of low-income enrollees are forgoing Cost Sharing Reduction, available only with silver plans. At incomes up to 200% FPL, CSR makes silver plans roughly equivalent to platinum. Since March 2021, at least two CSR-enhanced silver plans in each rating area, with an actuarial value of 94%, are available at zero premium to enrollees with income up to 150% FPL. In the 150-200% FPL bracket, the benchmark (second cheapest) silver plan costs 0-2% of income (topping out at about $45/month for a single person) and has an actuarial value of 87%. Yet silver plan selection in the 100-150% FPL bracket was just 76.4% in HealthCare.gov states, down from 84.9% in 2022 and 89.3% in 2017. In the 150-200% FPL bracket, silver crashed from 69.5% last year to 56.7% this year. It was 83.2% in 2017.

Let’s look first at enrollment growth by income.

How not to explain ACA metal levels (and, I hope, how to)

Subscribe to xpostfactoid 

I have a post up at healthinsurance.org that aims to guide ACA marketplace shoppers in selecting the metal level (bronze, silver, gold, very occasionally platform) that works best for them. My opener was the product of a lot of trial and error:

When shopping for a health plan in the ACA marketplace, it’s important to recognize that while Bronze, Gold and Platinum plans have the same value no matter who is shopping, the value of Silver plans varies with income. Accordingly, the metal level that will best suit your needs is also likely to vary with income.

That basic fact is a given to anyone who's studied the marketplace and so may seem obvious. But it's counterintuitive, and it's the single most salient fact about metal level selection.  HealthCare.gov's guide to the metal levels all but completely obscures it (and many other guides follow suit):

Did ARPA increase CSR takeup and so reduce underinsurance? A view from Covered California

Ever since the American Rescue Plan Act's boosts to premium subsidies in the ACA marketplace came online last March (and even before), a chief interest of mine has been whether the enhanced subsidies will reduce underinsurance as well as boosting enrollment (and so reducing uninsurance). 

The chief source of reductions in underinsurance would be improved takeup of silver plans with Cost Sharing Reduction (CSR) at incomes up to 200% FPL* ($25,760 for a solo enrollee). CSR is available only with silver plans. As boosted by ARPA,  a benchmark (second cheapest) silver plan is now free at incomes up to 150% FPL and costs 0-2% of income at 150-200% FPL. At 200% FPL, benchmark silver used to cost about $135 per month for a single person; it now tops out at $43/month. More than half of ACA marketplace enrollees have income below 200% FPL.

As noted in this post, silver plan selection among low-income enrollees had been sliding since 2017, but  ARPA did apparently reverse the trend during the emergency Special Enrollment Period that ran from Feb. 15 to Aug. 15 last year in HealthCare.gov states, and for varying periods in the 18 state-based exchanges.  Below, we'll get a point of comparison from California.

In New Mexico, a Midas touch has a double edge

Subscribe to (free) xpostfactoid

Let's take one more look at enrollment results in New Mexico's ACA marketplace, where extreme silver loading rendered average lowest-cost gold plan premiums 14% lower than those of lowest-cost silver plans, and gold plans were available well below the cost of a benchmark silver plan statewide (excepting those for whom silver plans also were free, or had single-digit premiums).

The unadulterated good news was for enrollees with incomes above 200% of the Federal Poverty Level, more than two thirds of whom chose gold plans, while only about 13% choose bronze. That's a real advance.

The good news at incomes below 200% FPL was that just 4% chose bronze plans, which carry deductibles usually in the $7,000 range for an individual.  Most of those who selected bronze at low income levels may have been subsidy-ineligible, usually because of an employer's offer of insurance. That's generally the case for a small percentage of enrollees with incomes in subsidy range.

The not-so-good news is that 31% of enrollees with incomes in the 138-200% FPL range chose gold plans, although silver plans have a higher actuarial value than gold plans at incomes below 200% FPL, reflected most dramatically in annual maximum out-of-pocket cost (MOOP) caps that can't go higher than $2,900, vs. a maximum allowable MOOP of $8,700 for gold plans. 

Open thread: How Trump's cutoff of CSR funding affected Maryland enrollment

My last post looked at the drop-off in silver plan selection among Marylanders eligible for strong Cost Sharing Reduction subsidies in 2018. CSR is available only with silver plans. When Trump cut off federal funding for CSR, insurers in Maryland priced it into on-exchange silver plans only,which generated large discounts in bronze and gold plans for subsidized buyers . For an explanation of how that worked, see the first note at bottom. For a summary of the discounts to the subsidized on offer in Maryland in 2018, see the second note.

Today, let's kick back and squint at the changes in metal level choices in Maryland at each income level (including the upper brackets this time) from 2017 to 2018. I'll offer a couple of observations below the charts now, and maybe more through the weekend. I invite you to offer your own.

Here are the percentages who chose each of the three main metal levels in each income band in both years. In both years, a bit under half of all enrollees had incomes under 200% of the Federal Poverty Level, and so were eligible for strong CSR (about 98% of them, anyway).  At bottom, the raw numbers at each metal level are charted, courtesy of the Maryland Health Connection. (Platinum and catastrophic plans accounted for 3% of enrollment between them in both years.)

2017

Income (% FPL)	% bronze	% silver (CSR)	% gold
< 100	3	96	0.7
100-138	4	95	0.5
138-150	7	92	0.5
150-200	10	88	1.0
0-200 (strong CSR)	7	92	0.8
200-250 (weak CSR)	21	74	3.2
250-300	30	60	6.0
300-400	31	57	7.4
>; 400	33	48	11.6
Unknown	26	54	11.0
Total	18	74	0.5

2018

Income (% FPL)	% bronze	% silver (CSR)	% gold
< 100 <100 p="">	10	80	7
100-138	8	84	7
138-150	9	83	8
150-200	13	76	10
0-200 (strong CSR)	11	79	9
200-250 (weak CSR)	24	46	28
250-300	32	32	33
300-400	37	25	34
> 400	42	24	27
Unknown	35	34	22
Total	23	55	19

CSR takeup: Good enough for me* and Emily Gee

Long before the Cost Sharing Reduction (CSR) subsidies accessed by more than half of enrollees in the ACA marketplace became a political battleground zero, I was preoccupied with CSR as the marketplace's primary (and too limited) defense against underinsurance. In dozens of posts, I explored what leads people to accept or reject CSR, i.e. to buy or forego silver plans if they qualify for the benefit (as CSR is available only with silver plans). Among the most basic conclusions:

1. Although a large body of research suggests that health insurance shoppers often make the wrong choice when faced with relatively small tradeoffs between premium and out-of-pocket costs, a large majority of CSR-eligible marketplace enrollees make the right choice That is, they choose not to leave a large subsidy on the table, despite the fact that silver premiums can be a strain on income and bronze plans temptingly cheap. Over 80% of enrollees eligible for strong CSR -- i.e., enrollees with incomes below 201% of the Federal Poverty Level (FPL) -- choose silver plans.

2. CSR takeup declines in step with the weakening of the benefit at higher income levels, with a sharp drop at 201% FPL, where the benefit weakens almost to insignificance.  Based on data released by CMS in July 2016, the chart below shows the takeup rates in the 38 states that used healthcare.gov in 2016. The rates are inflated by probably about 2 percentage points, for reasons explained in this post. The numbers attached to "Silver" under coverage level are the CSR-enhanced actuarial value of silver at each level.

CSR Takeup: HealthCare.gov states, 2016

Income range	CSR coverage level	Enrollees in income range	Enrollees With CSR	Takeup Percent- age
0-150% FPL	Silver94	3.64m	3.18m	87%
151-200% FPL	Silver87	2.21m	1.83m	83%
201-250% FPL	Silver 73	1.33m	866k	65%

The two-track individual market for health insurance

[Update/correction - This post originally included an important error: the RWJF breakout of off-marketplace metal levels referred to plans offered, not plans selected. While leaving that data in place, I've added survey data from the Commonwealth Fund regarding off-marketplace enrollees' metal level selections that also is not based on actual selection data but does also look rather similar to metal level selection among unsubsidized on-marketplace enrollees, as reported by HHS.]
---
There are basically two individual markets for health insurance in the United States: one for subsidy-eligible people earning under 201% of the Federal Poverty Level (FPL), and one for everyone else.

Subsidy-eligible marketplace shoppers with incomes up to 200% FPL are eligible for Cost Sharing Reduction (CSR) subsidies that radically reduce deductibles, copays and maximum out-of-pocket costs. CSR subsidies are available only to those who buy silver plans, as something over 80% of enrollees with incomes up to 200% FPL do.  CSR weakens sharply at 201% FPL and phases out at 251% FPL.

Some time ago I calculated that the weighted average actuarial value for plans sold on the marketplace in 2016 was just about 80%, (The actuarial value is the percentage of the average enrollee's yearly medical costs that the plan is designed to pay.)   80% AV is close to the average for employer-sponsored health plans, and it sounds good, but it masks a sharp division. For those with incomes up to 200% FPL, the average AV was 86%. For the unsubsidized, it was 69%. For those who obtained premium subsidies but had incomes over 200% FPL, it was also 69%.

While average AV was similar for the unsubsidized and the over-200% FPL-subsidized, their choices were somewhat different. About 60% of the over-200%-FPL subsidized group chose silver plans -- in part because weak CSR attaches to silver plans for those in the 200-250% FPL bracket. Among the unsubsidized, only 39% chose silver, but AV was boosted by 18.5% of this more affluent group choosing gold plans, and 3.3% choosing platinum.

This week, the Robert Wood Johnson Foundation published a study, reported by Modern Healthcare's Harris Meyer, that details plan choices offerings (and prices) in the off-marketplace ACA-compliant individual market. [Update: per note above, see Commonwealth Fund data below.] And it turns out, unsurprisingly, that the choices made by those who bought their plans off-marketplace -- by definition, unsubsidized -- look much like the choices of unsubsidized marketplace enrollees: a lot of bronze, but also a lot of gold and platinum.  Below is the breakout of metal level selections offerings off-marketplace for 2016 according to RWJF.*

Actuarial Value	Percent of Off-marketplace enrollees plan offerings
90 (platinum)	7.0**
80  (gold)	21.6
70 (silver)	33.7
60 (bronze)	33.1
57 (catastrophic)	4.6**
69.6 (Weighed AVG)

Their choice pattern [insofar as it reflects plan offerings]  is pretty close to that of unsubsidized enrollees on HealthCare.gov:

Actuarial Value	Percent of unsubsidized hc.gov enrollees
90 (platinum)	3.3
80  (gold)	18.5
70 (silver)	39.0
60 (bronze)	33.0
57 (catastrophic)	6.8
68.9 (Weighed AVG)

On-exchange or off-exchange, the unsubsidized seem to make similar choices

Back in April, I set out to compare the coverage obtained by subsidized enrollees in health insurance plans in the ACA marketplace in 2016 with the coverage obtained by unsubsidized buyers. The measure compared was actuarial value (AV) -- the percentage of the average enrollee's annual medical costs paid by the insurer.

Long story short: the average weighted AV for subsidized buyers in the 38 states using HealthCare.gov was 81.4%, right in line with estimated averages for employer-sponsored insurance. For the 15% of HealthCare.gov enrollees who did not qualify for subsidies, average weighted AV was 68.9%. Averages in the state-based exchanges are probably about the same. The more comprehensive coverage obtained by subsidized enrollees stems from the fact that about two thirds of them also access secondary Cost Sharing Reduction (CSR subsidies, available only with silver plans.

I also inferred that the coverage obtained by those who bought ACA compliant plans outside the marketplace was roughly comparable to that obtained by  unsubsidized marketplace enrollees.  And I've just happened on some corroboration.

We were young, we bought bronze, we churned....

I've stumbled on what seems like it may be a significant pattern in ACA marketplace enrollment data, but I don't know what it signifies.

It started with a look at detailed data that Covered California has published that focuses on new 2016 enrollees only -- as opposed to all enrollees, including the two thirds of current enrollees who re-enrolled. Earlier this week, I noted with some alarm that bronze plan selection was markedly higher and silver selection lower among the new enrollees than among all enrollees in 2015. Among the new enrollees, 58% selected silver plans and 32% bronze, compared to 65% silver and 25% bronze last year.

Only in passing did I note that according to HHS's national enrollment report, bronze and silver selection in California among all enrollees had only shifted a point this year, to 64% silver/26% bronze. That belatedly set the brain wheel spinning: Re-enrollees must be enrolled in silver at much higher rates than new enrollees.

True. If HHS totals are fully aligned with CoveredCA's tabulation, among California's re-enrollees this year the silver-bronze split is 67-23 -- 18 points wider than among new enrollees.

ACA marketplace is pricing out gold and platinum plans, while silver selection stays stable

HHS released its full report* on ACA marketplace enrollment for 2016. My primary interest as usual is in metal level selection. That is, mainly, whether the percentages of buyers selecting bronze plans (with their sky-high deductibles) and silver plans (required to access Cost Sharing Reduction subsidies, available to those with incomes under 250% of the federal poverty level) are shifting significantly.

Overall, metal level selection hasn't changed much since 2015. In all states combined, including those using their own exchanges, 23% bought bronze and 68% bought silver this year, compared to 22% bronze and 67% silver in 2015.

So wait, how did both percentages manage to uptick? That's the first of several points worth noting:

• The sharp rise in (unsubsidized) premiums in 2016 has priced a lot of people out of gold and platinum plans. In 2015, in all states combined, 7% bought gold and 3% bought platinum. In 2016, 6% bought gold and 2% bought platinum.

A little less underinsurance on HealthCare.gov this year

[1/11 update at bottom]

It looks as though takeup of Cost Sharing Reduction (CSR) subsidies by eligible buyers on HealthCare.gov is up slightly this open season, so far. CSR reduces deductibles, copays and maximum out-of-pocket costs for buyers with incomes below 250% of the Federal Poverty Level (FPL) -- but only if they select silver plans, the second-cheapest of four metal levels.

As of the end of open season for 2015 enrollment last February, 76.8% of CSR-eligible HealthCare.gov customers had selected silver plans and so accessed the benefit. For 2016 enrollees through 12/26/15, according to HHS's latest enrollment report, CSR takeup is up to 78.4% on the federal exchange.

Here's the basic calculation for CSR takeup among 2016 enrollees:

ACA enrollment 2016: pool somewhat wealthier; silver selection holds steady

[See update at 5a and 5b: light on who's unsubsidized]

HHS released its midterm report on ACA private plan enrollment for 2016 today. A few observations:

1. While HHS was obviously lowballing when it published enrollment projections in October, enrollment has already hit the lower range of those projections. The targets were 11.0--14.1 million plan selections by Jan. 31, 2016, including 2.8--3.9 million new customers.  As of Dec. 26, all exchanges combined had just shy of 11.3 million enrollees, including 3.0 million new customers.

2. The enrollee pool in the 38 states using HealthCare.gov is slightly wealthier this year than last. For 2016 to date, 37% of hc.gov enrollees for whom income data is available have incomes in the 100-150% FPL range. As of the end of OEII last February, 40% were in that range.There have been proportionately more buyers with incomes over 250% FPL this season. The difference is probably due to new Medicaid expansions in Pennsylvania, Indiana and Alaska, which probably put a couple of hundred thousand private plan enrollees into Medicaid.

Mysteries of the Maryland ACA Marketplace, cont.

As I noted on Oct. 3, Maryland Health Connection, the state's ACA exchange, sent me enrollment data indicating that Maryland may have the highest "CSR takeup rate" in the country. That is, in 2015, Maryland private plan buyers whose incomes qualify them for Cost Sharing Reduction (CSR) subsidies, which are available only with silver plans, chose silver and access the benefit at market leading rates. In Maryland, 86% of CSR-eligible buyers chose silver, compared to a national average of about 76%. That's doubtless in large part because Maryland cloned the web interface of the Connecticut exchange, which does an excellent job steering CSR-eligibles toward silver.

There are some peculiarities in the Maryland data, though, and they're thrown into sharper relief by the raw numbers of silver plan enrollees at each income level, which I did not have when I posted last week. Chief among them is a relatively huge number of buyers, 22%, with incomes low enough to qualify them for Medicaid, unless they're lawfully present non-citizens not yet eligible for Medicaid because they've been in the country less than five years.

Mysteries of the Maryland Marketplace

(Update post here)

As I've noted before, Connecticut's ACA exchange has been a market leader in steering private plan buyers whose incomes qualifying them for Cost Sharing Reduction (CSR) subsidies into silver-level plans (CSR is available only with silver). Also noted, back in January: When Maryland cloned Connecticut's technology and web interface in 2015, silver plan takeup improved.

Now, Maryland Health Connection, the state's ACA exchange, is reporting a market-leading level of silver plan selection among CSR-eligible buyers -- that is, buyers with incomes up to 250% of the Federal Poverty Level (FPL).  Nationally, about 76% of private plan enrollees who qualify for CSR buy silver plans and obtain the benefit (coincidentally, CSR-eligibles also make up about three quarters of all marketplace customers). Yesterday, Maryland announced that 86% of CSR-eligible enrollees in the state bought silver and accessed the benefit.

That's all the more the more striking in that just 62% of all buyers on the Maryland exchange selected silver, versus 68% nationally. The numbers indicate:

The ACA's uncertain shield against underinsurance: A CSR compendium

Note, 2/16/18: This post, and the index of posts it introduces, originated long before the legal challenge to federal CSR reimbursement began to directly affect policy and the shape of the ACA marketplace. The focus until the 2016 election was mainly on CSR takeup and the factors that affected it. In 2017, Trump's threats to cut off CSR reimbursement, executed in October, reshaped the ACA marketplace, driving up costs for the unsubsidized while providing windfalls for many of the subsidy eligible. That is a separate story, and posts relating to those effects are listed in a new section at the top of the index.

Updated 10/9/15, 4/6/16, 4/14/17

Cost Sharing Reduction (CSR) subsidies are the ACA marketplace's best defense against underinsurance for private plan buyers. That's why I've been so interested in who accesses or fails to access CSR and why -- and why takeup varies widely from state to state.

Thanks to CSR, half of marketplace enrollees obtain coverage that covers a higher percentage of the average enrollee's costs than the average employer-provided plan. That is, about 49% of enrollees are enrolled in CSR-enhanced silver plans that raise the plan's actuarial value -- the percentage of the average user's costs covered by the insurer --  to either 94% or 87% (see The Rosetta Stone of CSR takeup*).  The average in employer sponsored insurance is about 82%, or at least it was as of 2011, according to a Kaiser analysis. Another 5% of enrollees are in gold or platinum plans, with AV 80% and 90% respectively [paragraph added 4/14/17].

Below is an index of my posts examining the factors affecting CSR takeup, along with some posts questioning whether the benefit ought to be restructured.  I've done a fair number of single-state snapshots, and they're listed separately at bottom. The top two posts focused on California highlight price sensitivity; the Connecticut, New York, Maryland, Rhode Island Washington posts show how website design can shape the choice; and the posts on southern states mostly illustrate that lower income buyers, for whom the CSR benefit is strongest and the cost of silver lowest, are likeliest to access CSR.

Overall, according to the most recent enrollment figures for 2015, 56% of marketplace private plan buyers in all states accessed CSR (Update, 4/14/17: 58% in 2017).  About 85% of them reported a household income under 201% of the Federal Poverty Level (FPL) and so received a strong version of the benefit, raising the actuarial value of their silver plans to 94% (up to 150% FPL) or 87% (151-200% FPL). Another 7% of all buyers bought gold (AV 80%) and 3% bought platinum (AV 90%) plans. 21% bought bronze plans (AV 60%) with their sky-high deductibles, usually ranging from $5,000-6,600 per person. (Update: in 2017, the breakout was 4% gold, 1% platinum, 71% silver and 23% bronze.)

Here's a sampling of my posts on the subject.

Effects of Trump's CSR cutoff (added 2/16/18, updated 4/27/18)

If Seema Verma bans silver loading, how many marketplace enrollees will suffer? (4/12/18)

Choosing a metal level in the CSR-addled Maryland marketplace (1/17/18)

For whom the bronze bell tolls in the ACA marketplace (11/16/17)

Hey, Republicans: Auto-enrollment is within reach (11/10/17)

Free bronze or CSR-boosted silver? The choice in 5 top ACA marketplaces (11/4/17)

CSR windfall: Will it have a bronze or gold cast? (10/27/17)

Bronze and gold discount plans in California, 2018 (10/20/17)

States vary in response to CSR uncertainty (with David Anderson, Charles Gaba and Louise Norris) (10/11/17)

Covered California to midde-class enrollees: There may be gold in them thar hills (10/7/17)

Go ahead, Trump, cut off CSR payments -- starting in 2018 (7/20/17)

National CSR takeup (and implications)

"Strong" CSR takeup dropped modestly on HealthCare.gov in 2018 (4/3/18)

On HealthCare.gov, CSR takeup rose steadily 2015-2017 (2/15/18)

The real cost of benchmark silver for BCRA enrollees (7/1/17)

ACA vs. AHCA: Total subsidized shares of costs at different income levels and ages (3/19/17)

The Rosetta Stone of CSR takeup (1/9/17)

ACA afflicted by a deductible cliff (12/21/16)

Cutting off CSR subsidies will hit red state enrollees especially hard (12/5/16)

Two major divides in the post-ACA individual market (4/1/16)

Supporting the biggest decision for ACA marketplace shoppers (11/3/15)

How bronze plans offer fool's gold to the Treasury (11/1/15)

Surprise! When silver plans are cheaper, more people buy them (10/24/15)

Addled by the metal level (10/5/15)

"Are marketplace plans affordable?" - on Commonwealth Fund survey (9/28/15)

The feds are taking CSR and premium subsidies away from many enrollees (9/8/15)

Five factors shaping CSR takeup on ACA exchanges (9/1/15)

A quibble with Avalere over CSR takeup (8/20/15; updated, 9/3/15)

Is Obamcare's bronze trap widening? (on healthinsurance.org (8/12/15)

Income levels and CSR takeup in states that refused Medicaid expansion (8/23/15)

New data on Cost Sharing Reduction in ACA marketplaces

The latest ACA enrollment snapshot from CMS shed some new light on the extent to which ACA private plan buyers accessed Cost Sharing Reduction (CSR) subsidies. CSR reduces deductibles, copayments and maximum out-of-pocket costs for plan buyers with incomes under 250% of the Federal Poverty Level (FPL) -- but only if they buy silver plans (and forego the often much cheaper bronze plans).

CSR takeup is especially important for buyers under 200% FPL, because below that income level it raises the actuarial value of a silver plan from 70% to 94% (for buyers under 150% FPL) or 87% (for buyers in the 150-200% FPL range). At 200-250% FPL, CSR weakens, raising the AV just 3 points to 73%. Silver plan selection accordingly drops suddenly at 201% FPL.

The new report doesn't deliver any great surprises on the CSR front, but it does for the first time provide overall CSR numbers for the 13 states plus D.C. that run their own exchanges. The percentages of buyers accessing CSR in state-based marketplaces (SBMs) have always been lower than in the states using healthcare.gov, for several reasons

1. All the SBMs except Idaho have expanded Medicaid, which means that subsidized private plan eligibility begins at 138% FPL rather than 100% FPL.  The lower the income, the higher the CSR takeup rate - especially below 138% FPL, where the benchmark silver plan premium can't exceed 2% of income.
2. States with SBMs are generally wealthier, so a lower overall percentage of private plan enrollees are eligible for CSR.
3. Several SBMs do a much poorer job than healthcare.gov of highlighting CSR for those eligible -- though conversely, several SBMs do a better job than hc.gov on this front.

All that said, here are some new facts, along with some extrapolation from info that was in HHS's March report but not updated in this one.

1) In states using healthcare.gov (federal facilitated marketplaces, or FFMs) 60% of enrollees accessed  CSR -- 4,550,205* out of a total enrollment of  7,524,234.  In the SBMs, 49% accessed CSR -- 1,300,731 out of 2,662,964.

Medicaid expansion means a richer QHP buyer pool on ACA exchanges

In my close look at silver plan selection in 2015 among healthcare.gov customers who were eligible for Cost Sharing Reduction (available only with silver plans). I expressed some disappointment that CSR takeup had apparently dipped a bit on the federal exchange from 2014 to 2015 (HHS did not provide CSR takeup numbers for states operating their own exchanges). Disappointment on that particular point may have been misplaced.

While I continue to believe that too many low income ACA private plan buyers selected bronze plans, CSR takeup probably did not decline from 2014 to 2015. In fact, since silver plan selection across all exchanges ticked up a bit, from 65% in 2014 to 67% in 2015, CSR takeup probably did too.

My perception that CSR takeup dropped on healthcare.gov in 2015 stemmed from a drop in silver plan selection from 76% to 74% by buyers eligible for any kind of subsidy --including those eligible for premium subsidies but not CSR. But that drop may just reflect a shift in the composition of the market using healthcare.gov -- specifically, it may reflect a higher percentage of customers in healthcare.gov states being placed in Medicaid in 2015. This happened because two states that dropped their own exchanges and joined healthcare.gov in 2015, Oregon and Nevada, had expanded Medicaid, while three other states on the federal platform implemented the Medicaid expansion at some point during 2014 (Michigan and New Hampshire) or as of Jan. 1, 2015 (Pennsylvania).

The poorer the buyer pool, the higher the CSR takeup

States that expanded Medicaid generally have lower CSR takeup because their buyer pool for private health plans is wealthier. In states that refused the expansion, the buyer pool starts at 100% of the Federal Poverty Level (FPL); in states that embraced the Medicaid expansion, it starts at 138% FPL. In hc.gov states that refused the Medicaid expansion, consequently, an astounding 50% of private plan buyers had household incomes under 150% FPL; in expansion states, just 25% had incomes below that level.

HHS expected *more* low-income ACA buyers to select silver plans

In my multi-stage exploration of the data on ACA private plan buyers' metal level selections, I have been pleasantly surprised to determine with a fair degree of confidence that about 90% of shoppers on healthcare.gov with incomes under 200% of the Federal Poverty Level selected silver plans -- and so availed themselves of the Cost Sharing Reduction (CSR) subsidies available only with silver. For all ACA buyers on all exchanges, the figure is a few percentage points lower, since many state exchanges did a much poorer job than healthcare.gov in steering CSR-eligible buyers toward silver.

While CSR is available to buyers with incomes up to 250% FPL, the rate of silver plan selection (necessary to access CSR) falls off a cliff at 201% FPL. That's wholly rational, as CSR weakens as you move up the income scale. For those with incomes between 200 and 250% FPL, CSR bumps up the actuarial value of a silver plan -- that is, the percentage of the average plan holder's yearly medical costs paid by the insurer -- just three points, from 70% to 73%.  At lower income levels CSR is much more valuable, raising AV  to 87% (for incomes at 150-200% FPL) or 94% (for incomes under 150% FPL). Accordingly, in New York (one of the few states that breaks out metal level selection by income level), 89% of buyers with incomes under 200% FPL bought silver -- but just 59% of those between 200 and 250% FPL did.

With all this in mind, I was surprised to read* in the latest CBO updated ACA cost projections that the Department of Health and Human Services and the Joint Committee on Taxation have been surprised that more buyers eligible for CSR have not selected silver plans:

Outlays for cost-sharing subsidies over the 2015–2024 period are currently projected to be $39 billion less than previously estimated, primarily because CBO and JCT now expect that more people will forgo those subsidies by choosing to enroll in a bronze plan instead of a silver plan...

Maryland's low income ACA customers benefit from Connecticut's site design

Maryland's ACA exchange was a disaster last year, so the state started over, creating a freely offered clone of the highly successful Connecticut exchange. That's worked out very well.

Charles Gaba reports that Maryland is one of 18 states that have exceeded HHS's goal for private plan enrollments in 2015.  As of January 11, Maryland has enrolled 91,137 residents in private plans, versus 67,757 in the first open season that ended last April.

Equally importantly. the Maryland exchange has strongly boosted the percentage of plan buyers who selected silver-level plans and reduced the percentage that bought bronze -- the lowest level, with deductibles averaging over $5,000 for a single enrollee. In 2014, just 49% of Maryland private plan customers bought  silver, and 31% bought bronze. That's in contrast to 65% silver/20% bronze breakdown in the nation as a whole,and 69%/17% in the 36 states using healthcare.gov.  This year so far, Maryland's silver plan takeup has risen to 61%, while bronze takeup has dropped to 23%.* 

Rational choice in the ACA marketplace

Here's another piece of the puzzle in my quest to figure out why ACA private plan buyers bought low-premium, high-deductible bronze plans in much higher proportions in some states than in others (8% of Mississippi plan buyers selected bronze; 41% of Hawaiian shoppers did). A good predictor is each state's public health profile. (Thanks to Brad G. for putting me on the trail.)

Bronze plans, in which deductibles average over $5,000 per person, are bad deals for people who are likely to make heavy use of medical services. They're also bad deals for low-income buyers, who can access generous Cost Sharing Reduction subsidies that reduce deductibles and co-pays (radically for those with incomes under 200% of the Federal Poverty Level) -- but only if the buyer chooses a silver plan. Low income buyers are often in poor health, and know it. Most ACA buyers have been uninsured and so may have pent-up healthcare needs.

I have previously noted that a very high percentage of buyers eligible for CSR did in fact choose silver plans, and that lower income states did have lower percentages of bronze buyers -- though there are notable exceptions up and down the scale. The same is true for measures of public health in each state. Wealthier states tend to have healthier residents -- though wealth disparities within states can complicate the picture.

In the chart below, I have tabulated three public health measures drawn from the Kaiser Family Foundation's State Health Facts: life expectancy, incidence of  Diabetes, and obesity -- for the ten states with the lowest and highest takeup of bronze plans. The average bronze takeup states in the former group is 14.25% of all plan buyers, and in the latter group, 31.1%.  In all three health measures, the low-bronze-takeup states as a group significantly underperform the high-bronze-takeup group. The income disparity between the two groups is also stark.*