With ARPA subsidies set to expire, a window on the ACA's off-exchange market

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A press release from New Jersey’s Department of Banking and Insurance (DOBI) urging Congress to extend the enhanced ACA marketplace subsidies created by the American Rescue Plan Act (ARPA) in 2021, which are funded only through this year, led me to discover that DOBI has resumed quarterly tracking of off-exchange as well as on-exchange enrollment, after a long hiatus (1-2 years?). Reports are now available through Q2 2024.

In general, nationally, off-exchange enrollment data is spotty, and the off-exchange enrollment numbers in NJ open a window into how expiration of the ARPA-enhanced subsidies, which Republicans are unlikely to extend, may affect those with income above 400% FPL, the once and likely future cap on subsidy eligibility. In the Open Enrollment Period (OEP) for 2021, the last year with the 400% FPL cap on income eligibility, 43% of state enrollees in ACA-compliant plans were unsubsidized. In 2024, just 25% were unsubsidized. We will probably soon be back to 40%-plus.

Steep enrollment drops in New Jersey's individual market

ACA marketplace enrollment was down 7% in New Jersey as of the end of open enrollment, according to CMS. That's a somewhat steeper drop than the 4% national average and the 5% average among states using HealthCare.gov, but in range.

This week the state Department of Banking and Insurance (DOBI) released first-quarter enrollment results for the entire individual market, off-exchange as well as on-. It shows more severe drops on both fronts -- particularly off-exchange:


New Jersey suffered an average weighted premium increase of 22% in 2018, with steeper increases for market hegemon Horizon Blue Cross. As I noted recently, unsubsidized enrollees didn't get any benefit from silver loading, as there were no discounted silver plans available off-exchange. Unsubsidized enrollees basically had four choices: eat huge premium increases, downshift to bronze, switch to narrow network AmeriHealth, or drop out.

It appears that a significant number of unsubsidized enrollees made that last choice. Off-exchange enrollment was down not only compared to the first quarter of 2017, but compared to the last quarter, when enrollment is at low ebb (overall enrollment is up 6% since Q4 2017, but down 11% since Q1).

Off-exchange enrollment stats are hard to come by, but steep enrollment drops are to be expected.  Matt Fiedler of the Brookings Institute estimated last fall that premium hikes averaging 20.5% nationally in 2017 were likely to reduce overall unsubsidized enrollment by 12.3%. New Jersey's numbers would seem in line with that estimate.

A few notes and question marks regarding both off- and on-exchange enrollment: