Three cheer(ing) facts about the ACA marketplace for 2023

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HealthCare.gov posted available health plans and premiums in the ACA marketplace for 2023 this week. Many state-based exchanges also have their menus up. (So does commercial broker and Direct Enrollment platform HealthSherpa, the easiest place to check out plans and prices throughout HealthCare.gov states.)

On the whole, the markets are in good shape, albeit with some lead linings to bright puffy clouds. The ARPA-enhanced subsidies that boosted enrollment by 21% last year are still in place, thrown a three-year lifeline by the Inflation Reduction Act (though with Republican control of at least one house of Congress likely, their ultimate future is uncertain). Not only was enrollment up in 2022; retention was also good, at least through first payments, probably boosted by radically lower subsidized premiums (95% of those who selected plans in Open Enrollment had effectuated enrollment in February). 

Gold plans will be more affordable to more enrollees than ever this year, a boon to higher-income enrollees who don't qualify for the strong Cost Sharing Reduction that attaches to silver plans at incomes up to 200% of the Federal Poverty Level (FPL).  Insurers have newly entered several markets, though new offerings are more or less offset by the exit of Bright Health from 17 states (Louise Norris runs through market entries and exits nationwide here).

Three salient features of the national marketplace are outlined below. A caveat is that the first two deal in broad averages: prices and offerings vary widely by state, and often by county or even zip code.

Two thirds of ACA enrollment growth is in 11 nonexpansion states. Nearly half is in Florida and Texas

CMS announced today that plan selections for 2022 in the ACA marketplace have reached an all-time high of 13.6 million. That's up from 12.0 million as of the end of Open Enrollment (OE) for 2021, a 13% increase so far. [Update: Per Charles Gaba, the total as of Dec. 15 last year was 11.6 million, as most of the 15 SBEs' Open Enrollment seasons did not end on Dec. 15. See note at bottom]

As in last year's OE and this year's emergency SEP, enrollment growth was overwhelmingly concentrated in states that have refused to enact the ACA Medicaid expansion. Enrollment increased by 1.7 million in 33 states using HealthCare.gov, the federal exchange -- and 1.3 million of that increase was in the 11 remaining holdout states (excluding Wisconsin, which has no coverage gap), a 25% year-over-year increase in those states. Enrollment in Florida and Texas increased by 900,000.  

Over two years, from OE for 2020 to OE through Dec. 15 for 2022, enrollment in these 11 states has increased by 1.8 million, or 38%.

Is enrollment surge on GetCoveredNJ driven by off-exchange migration? Maybe not.

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Liberty State Park, Jersey City, NJ

New Jersey's Department of Banking and Insurance (DOBI) reports that enrollment in health plans on GetCoveredNJ, the state's ACA exchange, was up more than 25% as of December 5 compared to the same time last year. That may be the largest one-state year-over-year surge during an Open Enrollment season in which enrollment was up about 9% nationally as of Dec. 8. 

New Jersey has a large off-exchange individual market, which in 2020 accounted for 30% of enrollment in ACA-compliant plans (94,885 out of 316,580 total enrollments as of Q1 2020). The surge in on-exchange enrollment may provide a hint as to the extent of migration from off-exchange to on-exchange driven by the American Rescue Plan Act's removal of the income cap on subsidy eligibility. Since April of this year, premiums for the benchmark (second cheapest) silver plan have been capped at 8.5% of income, regardless of how high the income is. New Jersey, moreover, layers its own supplemental subsidy on top of the federal APTC. At high incomes, NJ kicks in $100/month per person, up to an income of 600% FPL. This subsidy, like the federal one, is only available on-exchange.

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Longer Open Enrollment period in ACA marketplace provides a fail-safe for enrollment errors

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Health insurance broker Jenny Chumbley Hogue, based near Dallas, highlights one good thing about the longer Open Enrollment Period for the ACA marketplace enacted by the Biden administration (OE is now running through January 15 rather than December 15):

Thank goodness OEP extended to 1/15 so we can correct the issues. @charles_gaba @LouiseNorris @AlekaGurel @xpostfactoid @SheronESidbury

— Jenny Chumbley Hogue (@kgmom219) December 13, 2021

That is: Marketplace enrollees who passively let themselves be auto-re-enrolled for 2022 in their current plan, and get shocked in January by a sliding benchmark that raises their premiums (sometimes dramatically), can now choose a cheaper plan before January 15 and suffer only one month at the higher premium, rather than being locked in for twelve months.

At an income of $25,000 for a couple -- just under 150% FPL -- the benchmark (second cheapest) silver plan is free in 2021 and 2022, thanks to the subsidy boosts created by the American Rescue Plan Act, enacted in March 2021 (the ARPA Jenny Hogue refers to in the tweet). That is, at least two silver plans are free for any individual or family with an income up to 150% FPL. 

This year, the cheapest silver plan in Dallas was the Blue Cross plan shown below. But see what happens to a pair of 63 year-olds in Dallas who renew that plan in 2022:

ARPA subsidy boosts in ACA marketplace reduced underinsurance, reversing a 'slide to bronze' at low incomes

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When the premium subsidy enhancements for the ACA marketplace that became law when the American Rescue Plan passed were first published in early February of this year, my first thought was that no one with an income below 200% FPL should ever buy a bronze plan again:

If the subsidy enhancements become law while the emergency SEP [Special Enrollment Period, running from Feb. 15 to Aug. 15 on HealthCare.gov] is still open, bronze plan enrollment at incomes under 200% FPL should go to zero. At incomes up to 150% FPL ($19,140 for a single person), silver coverage will be free. At 200% FPL ($25,520 for a single person), benchmark silver will cost $43 per month. That expense doesn't feel like nothing at that income, but the average deductible for silver at that income level ($800) is about one ninth of the average bronze deductible ($6,921). The out-of-pocket maximum for bronze plans is usually close to the highest allowable, $8,550 for a single adult.  For silver at incomes up to 200% FPL, it's $2,850, and usually well below that, averaging $1,189 at incomes up to 150% FPL and $2,528 at 150-200% FPL. 

Well, those subsidy boosts did go into effect during the emergency SEP, helping to drive a major surge in off-season enrollment. Nationally, 2.8 million people newly enrolled in ACA marketplace plans from Feb. 15 to Aug. 15, 2.1 million of them in the 36 states using the federal exchange, HealthCare.gov. And while selection of plans at metal levels other than silver at low incomes did not go zero during the SEP, it did go way down, reversing a troubling trend.  The ARPA subsidies are reducing underinsurance.

Almost a quarter of all emergency SEP enrollees in ACA marketplace should have been in Medicaid

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For years, we have had to infer what percentage of ACA marketplace enrollees in states that have refused to enact the ACA Medicaid expansion have incomes below 138% FPL -- the Medicaid eligibility threshold in expansion states. It's a very large percentage, but as CMS's enrollment reports usually break out income in increments of 50 FPL percentage points, e.g., 100-150% FPL, it has to be inferred.

Just once, in 2016, CMS did provide enrollment results by state for the 100-138% FPL income range as well as for the broader 100-150% FPL bracket. In nonexpansion states, the former was about 85% of the latter. For years since, I've used 85% as a benchmark to estimate down from 100-150% FPL for the "should-have-been-in-Medicaid" cohort.

The final enrollment report for the 2021 emergency Special Enrollment Period, which ran from Feb. 15 to Aug. 15 in the 36 HealthCare.gov states, provides a tantalizing hint: 33% of all enrollment in those states was in the 100-138% FPL bracket. (All nonexpansion states use HealthCare.gov.) But what percentage of those were in the 13 states that had not expanded Medicaid as of the SEP period? (I'm including Oklahoma, which opened the Medicaid expansion gate on July 1 of this year.) 

Another Hanukkah miracle due in Week 7 of ACA Open Enrollment for 2020?

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Last year, enrollment in the ACA marketplace in the 39 states using HealthCare.gov trailed the prior-year enrollment pretty dramatically in each of CMS's "weekly enrollment snapshots."  By the end of Week 6, enrollment was at 88.3% of the total at the same point in December 2017.  Then lo, at the end of Week 7 the gap had shrunk from 12% to 4%.  What caused the late surge?

The surge was illusory. Week 1 was a day short last year. That was no mystery, and trackers accounted for it, noting that first-week enrollments stood at about 125,000 per day. What was not fully accounted for in advance was that the extra day made up in Week 7, which had seven enrollment days last year vs. just six in 2017, carried a lot more weight than the shorted November day, as enrollment is much heavier at the end of the season. As I noted at the time:

About that "late enrollment surge"

At the end of Week 6 of Open Enrollment for 2019 in the 39 states that use HealthCare.gov, all-state enrollment, at 4,132,432, was 88.3% of the Week 6 total for 2018.

By the end of Week 7, the final week, the 2019 total (8,454,882) was 95.8% of the 2018 total. Surprise! News stories reference a late enrollment surge. But the surge was a mirage -- generated by a slight difference in the weekly breakdown of an enrollment season that was 45 days in both years. Or rather, the surge was normal and happens every year -- this year the pace did not accelerate more than last.

In CMS's weekly enrollment snapshots, "Week 1" had four days in November 2017 and three days in November 2018. "Week 7," conversely, had six days in December 2017 and seven days this December.

Enrollment season starts slowly and ends fast. This year, enrollments averaged 123,892 per day in Week 1 and 617,493 in Week 7. More than half of all enrollment -- 51% -- happened in the final week (boosted by about 1.7 million auto-enrollments or passive renewals, added in at the end). Last year, 47% of enrollees were booked in the final (6-day) week.

Lower benchmark premiums may contribute to reduced on-exchange enrollment in 2019

Three weeks into open enrollment for 2019, ACA marketplace enrollment in the 39 states that use HealthCare.gov is down 11%. compared to this time last year (adjusting for one less open day so far this year).  There's a lot of potential reasons for that: further draconian cuts to advertising and enrollment assistance, repeal of the individual mandate in tandem with allowing medically underwritten short-term plans to provide full-year renewable insurance, election distraction, etc.

One less recognized factor that could have a measurable impact on on-exchange enrollment for 2019 is a likely drop in the subsidy-eligible population at higher income levels, mainly 300-400% FPL.

Though marketplace enrollees are theoretically eligible for subsidies if their incomes are below 401% FPL, subsidies are only credited if the unsubsidized benchmark silver plan premium exceeds the percentage of income deemed affordable. At 300-400% FPL, that's 9.86% of income. Historically, many young enrollees in particular with incomes below 400% FPL did not qualify for subsidies (because unsubsidized premiums are lower for younger adults).

In 2018, benchmark premiums shot up 34%, due in large part to various forms of Republican sabotage. That spike doubtless helped drive a 10% increase in on-exchange enrollment at the 300-400% FPL income level in HealthCare.gov states, while enrollment dropped at every other income level.

Enrollment by income level, 2017 vs. 2018

HealthCare.gov 

Year	Total enrollment	100% to 150% FPL	151% to 200% FPL	201% to 250% FPL	251% to 300%  FPL	301%- 400%  FPL	Other FPL*
2017	9,201,805	3,208,242	2,050,555	1,312,520	752,403	786,678	1,091,407
2018	8,743,642	2,979,236	1,885,778	1,277,488	747,165	867,198	986,777
Change	-5.0%	-7%	-8%	-3%	-1%	+10%	-10%

* "Other FPL" is comprised mostly of unsubsidized enrollees. About one quarter are likely enrollees with incomes under 100% FPL, most of whom are likely legally present noncitizens time-barred from Medicaid, who are subsidy-eligible.

Slow start to Open Enrollment 2019

The Democrats' capture of the House of Representatives has saved the ACA's core programs and funding. Most fundamentally, Republicans have lost their chance to cut the trillion-plus dollars over ten years in federal healthcare spending that they tried to cut last year -- most of it in Medicaid. Instead, the ACA's expanded Medicaid eligibility may be available in seven more states by 2020 than in 2018.  And the ACA marketplace's income-adjusted and relatively generous subsidies (compared to proposed Republican replacements) remain intact.

That said, early reports from Open Enrollment for 2019 suggest that various forms of Republican sabotage -- massive cuts to advertising and enrollment assistance, creation of a medically underwritten market in conjunction with repeal of the individual mandate -- may be taking their toll.  Enrollment on HealthCare.gov, the federal exchange serving 39 states, was down about 13% in the first week (adjusted for a one day difference in days open) and 8% in week 2.

That could mean nothing, or it could mean a lot. Enrollment could catch up with last year's (which was down 5% in hc.gov states from 2017 and 9% from 2016), or fall further behind. Charles Gaba chalks the slow start up to election distraction -- in the media if not for the public at large -- although, weighing all factors pro and con, he'd previously predicted a 5% drop this year. Former HealthCare.gov chief marketing officer Joshua Peck is less sanguine:

Unsubsidized ACA marketplace enrollees drop out early

Early this week, CMS reported that unsubsidized enrollment in ACA-compliant plans dropped 20% in 2018, while subsidized enrollment dropped just 3%. I pointed out that on-exchange unsubsidized enrollment dropped much more modestly, just 6%. That bespeaks a still steeper drop in off-exchange enrollment, suggesting that some previous off-exchange enrollees may have moved on-exchange in 2018 -- some obtaining subsidies, others not.

Today Charles Gaba notes that while unsubsidized on-exchange enrollment did not drop precipitously this year, first-month attrition among the unsubsidized who enrolled on-exchange was massive -- in a year in which overall attrition appears lighter than usual (over 80% of on-exchange enrollees are subsidized). While only 5.6% of subsidized enrollees are reported to have dropped coverage as March 15, 29%* of unsubsidized enrollees did.  This may not be surprising in a year in which premiums rose an average of 27%, largely as a result of Republican sabotage (cutoff of direct CSR reimbursement, radical cuts in enrollment assistance and advertising, weak enforcement of the individual mandate).

While the attrition among the unsubsidized this year is startling, it continues a pattern. Far higher percentages of unsubsidized than subsidized enrollees also dropped out in 2017 and 2016, rising each year. At the same time, attrition among subsidized enrollees dropped each year.

States vary in their responses to CSR uncertainty

By David Anderson, Charles Gaba, Louise Norris, Andrew Sprung

Note: this post is a joint effort with colleagues who have closely tracked the CSR chaos induced by Trump and Republicans in Congress. Dave Anderson is a former health insurance analyst, now a healthcare scholar at Duke, and a blogger at Balloon Juice; Charles Gaba is the fabled chronicler and analyst of ACA enrollment, marketplace pricing, and healthcare policy; Louise Norris is co-owner with her husband Jay of a health insurance brokerage for individual market customers, and a top source of marketplace information and analysis at her own blog (link in byline) as well as at healthinsurance.org and elsewhere.

Note 2 Today, the Maryland and California exchanges opened their plan preview tools for 2018, with premiums listed. California has implemented its planned CSR surcharge, adding 12.4% to the premium of silver on-exchange plans only. In some regions, the cheapest gold plan is cheaper than the cheapest silver.

Update, 10/14: David Anderson has mapped out the choices states have made to cope with CSR uncertainty (and now, CSR cutoff) here, and Charles Gaba is charting them here.

The open enrollment period for the 2018 ACA Marketplace that begins on November 1, 2017 is likely to confront enrollees with more challenges than any open enrollment since the troubled launch of the ACA Marketplace in October 2013. The time period is shorter, the outreach will be far less robust, and the pricing of plans will behave in ways that people do not expect.  Much of the pricing variance will be a result of choices that states and insurers have made in response to the uncertainty over whether the federal government will continue to reimburse insurers for the Cost Sharing Reduction (CSR) subsidies that insurers are legally obligated to provide to qualified exchange enrollees.  

Fly-specking a myth-busting from HHS on the ACA marketplace

As the ACA's fourth open enrollment kicks off in the face of steep rate hikes and reduced competition, HHS Secretary Burwell feels compelled to engage in some "myth busting."

Fair enough, but I in turn feel compelled to, shall we say, qualify the clarifications. My two cents are in italics, below each myth-bust.

Myth #1: Health coverage on the Marketplace is unaffordable.

On the surface, headline rate changes can look spooky – but they don’t actually reflect what the vast majority of people will pay.

If you dig deeper, most consumers shopping on the Marketplace will be able to find a plan between $50 and $100 per month, thanks to financial assistance.

Well...it depends what your definition of "vast majority" is. At present there are 10.5 million marketplace enrollees, and about 1.5 million of them are unsubsidized. There are also 6.9 million enrollees in the off-marketplace individual market, however, by HHS's tallying. Off-marketplace enrollment estimates vary; Mark Farrah Associates pegged the total individual market at 20.2 million in August, which would suggest about 9 million off-marketplace.  

HHS estimates that 2.5 million current off-marketplace enrollees are "potentially" eligible for subsidies, but "potential" does not mean "actual," and the actual number is probably considerably smaller, as I explained here. 

If 2.5 million off-marketplace enrollees were indeed subsidy-eligible, and if the 6.9 million off-marketplace count is accurate, then about 2/3 of current individual marketplace enrollees would be eligible for subsidies. The actual percentage is probably somewhat smaller. At present, by HHS's count, barely more than half of individual market enrollees are subsidized. 

It may be literally true that "the vast majority" of people shopping on the Marketplace will be subsidy eligible, but that's because most individual market customers who are subsidy ineligible are aware of that fact and don't bother with the marketplace.

The unsubsidized individual market is where the wild things are -- and will indeed be spooky for many who are not eligible for subsidies but not truly wealthy.

CMS Open Enrollment error in New York (updated, with CMS correction)

[Update 2/11/16: CMS has made  a correction -- see below.]

CMS's ACA enrollment snapshot for the final week of Open Enrollment 2016 contains an error, bolded below:

It is also worth noting that nearly 400,000 people signed up for New York’s new Basic Health Program, along with about 33,000 people who signed up for Minnesota’s Basic Health Program, during this Open Enrollment. Basic Health Programs are state based programs supported by the Affordable Care Act that provide health insurance coverage to low income individuals who would generally otherwise be eligible for qualified health plans [QHPs]. In fact, about 300,000 of the New York Basic Health Program enrollees for 2016 are people who enrolled in Marketplace coverage for 2015 and were included in last year’s Marketplace total plan selections.

Enrollees in New York's Essential Plan, the BHP formed under the auspices of  the ACA, come from two pools. The first is those who lack access to employer-sponsored plans and have incomes between 139% and 200% of the Federal Poverty Level (FPL). If the Essential Plan did not exist, these people would be eligible for subsidized QHPs in New York's private marketplace. Some of them were in fact enrolled in QHPs in 2015, but not 300,000.

About that deadline, HealthCare.gov..

HealthCare.gov really, really wants the uninsured to get covered by Jan. 1. Hence these daily emails:

Fleshing out a (real) ACA hardship story in the WSJ

It's inevitable that reporters' vignettes about ACA shoppers will often lack context or essential details. Print space is limited, readers' attention is limited,  reporters' time is limited, and protagonists' grasp of their own experience may even be limited.

Still, the back stories are often worth probing (3, 2, 1. 0). Here's one from today's Wall Street Journal, with Louise Radnofsky, Stephanie Armour, and Anna Wilde Mathews reporting on the first day of Open Season II. There's no inaccuracy, but the rate-shock subplot in this brief account does leave a question mark:

No, Virginia, ACA administrators do not need to "retain" the prior 8 million signups in 2015

Tis the season for preview articles spotlighting the challenges of signing up more uninsured and retaining the newly insured in Year 2 of the Affordable Care Act. The New York Times' Reed Abelson, in an otherwise excellent overview, repeats a common fallacy:

the Obama administration is expected to try to persuade about five million more people to sign up while also trying to ensure that eight million people who now have coverage renew for another year.

No one can or will try to ensure eight million renewals, because a very large proportion of 2014's enrollees -- perhaps half or more -- will not need to renew their coverage. They will be covered by new employers, or new spouses, or newly employed old spouses, or they will lose income and become eligible for Medicaid, or they will go on disability, or die, or, or, or...

The health insurance market is an ocean, endlessly churning

Long, long ago, back on March 22, I noted of the ACA signup count that it ain't over when it's over. Medicaid enrollment, including those newly eligible under the ACA expansion, is open all year. And in this interval between open enrollment periods, many people will become eligible for a two-month "special enrollment period" if they experience a "qualifying event" such as job loss, divorce, marriage (if, say, one of the couple has no income), or childbirth. I also noted with some wonder how fluid health insurance markets are: according to an estimate by healthcare scholars Rick Curtis and John Graves, less than half the people who will be eligible for ACA enrollment at the end of 2014 will have been eligible a year prior. [Update, 4/4: Graves has just made the case anew with Jonathan Gruber.]

Today's news brought several further snapshots of this fluidity. The LA Times' Chad Terhune noted another large category of pending special enrollments -- college graduates:

it's estimated that several hundred thousand more Californians could qualify for a special enrollment period as college students graduate, families move and workers change jobs.

In the short term, also in California, extended enrollment for those who started but could not complete applications before 3/31 is going to be huge, reports Marketwatch's Russ Britt:

ACA enrollment: driving uphill in a snowstorm.

As George W. Bush's second-term HHS Secretary, Michael Leavitt knows something about rocky rollouts of new government health programs, having overseen the launch of the Medicare Part D prescription drug coverage program, now broadly regarded as a success (e.g., by Leavitt).  As chair of health consultancy Leavitt Partners, he's also contracted with several state governments to help set up their ACA exchanges -- a role that subjected him to fierce conservative fire when he was named head of  Mitt Romney's transition team.  In 2011, he urged Republican governors to be practical and take control of their own state exchanges rather than cede the effort to the federal government. Notwithstanding his many qualms about the Affordable Care Act (e.g., its funding mechanisms), he is a believer both in state exchanges and in extending coverage to uninsured Americans.

It is not surprising, then, that in a January interview with Julie Appleby of Kaiser Health News, Leavitt signaled considerable empathy for the besieged team trying to get the ACA launched. Asked about one of the administration's many adjustments to rules and deadlines -- the extension of catastrophic plan eligibility to those whose 2013 plans were canceled -- he offered a striking metaphor that captures the administration's mindset and m.o.:

They’re trying to find ways to keep enough momentum moving forward.  Think about it like a big snowstorm, and you’re trying to drive a car uphill. The most important thing is to keep momentum and keep it out of the ditch. You might swerve from side to side, or might even do a circle or two. But if you can keep the momentum going up the hill, then you can ultimately succeed. They’re driving on a slick road up a stormy hill. They will do some things they hadn’t anticipated. But forward momentum is their game. At the end of the day, we’ll find out. They may get there; they may end up in a ditch. They may have a collision. Who knows?