The retentive ACA marketplace, revisited

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In my last post, I noted that enrollment drops in the ACA marketplace recorded in each year of the Trump era at the end of Open Enrollment more or less evaporate in yearly comparisons of average monthly enrollment, or end-of-year enrollment.

That is, it seems that fewer people in the last two years drop out without paying, and perhaps a higher percentage remain enrolled all year (many people in the ACA marketplace do have good reasons not to remain enrolled all year -- one of the marketplace's vital roles is as a stopgap). That's congruent with another change recorded in 2019: new enrollments down (-15.7%), re-enrollments up (2.3%), as of the end of Open Enrollment.

Why have apparent enrollment drops as of the end of OE in each of the last three years either shrunk or eroded entirely over the course of the year? A few possibilities:

ACA marketplace enrollment is down at low incomes as well as at high ones

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[Update, 8/15: CMS data on average monthly enrollment in each year appears to suggest that apparent year-over-year enrollment drops among the subsidized as of the end of Open Enrollment may have evaporated (in 2018, and perhaps 2019) as the year progressed. See this post.]

CMS is out with a report highlighting, not to say gloating over, a steep decline in unsubsidized enrollment in the ACA-compliant individual market from 2016 to 2018.  Nationally, while subsidized enrollment was up 1.3% in that period, unsubsidized enrollment crashed 40%, from an average monthly enrollment of 6.27 million in 2016 to 3.77 million in 2018.

That's not surprising, given premium increases averaging 21% in 2017 and 26% in 2018, and the obvious fact that the ACA marketplace was under-subsidized from the start and essentially unaffordable for many people with incomes modestly above the 400% FPL subsidy cutoff, as Urban Institute scholars Linda Blumberg and John Holahan pointed out in 2015:

Here I'd like to add a corollary: Enrollment since 2016 has declined not only at the top of the income scale, among those with incomes above 400% FPL, but at the bottom, among those with incomes up 200% FPL. It's shifted toward the upper end of subsidy eligibility, into the 200-400% FPL income range. The percentage of enrollees with incomes in that range has risen from 29.5% in 2016 to 34% in 2019 in HealthCare.gov states, and from 40.4% to 44.1% in California.

Unsubsidized on-exchange enrollment is also shrinking fast

Off-exchange enrollment in ACA-compliant plans is contracting sharply. The Kaiser Family Foundation reports that average monthly enrollment in off-exchange ACA-compliant plans was down 25% from 2016 to 2017. Further, all off-exchange enrollment (including in grandfathered and grandmothered pre-ACA plans) was down 38% from the first quarter of 2017 to the first quarter of 2018. It's not yet possible to break out the drop in ACA-compliant off-exchange plans alone, but it's likely close to that 38% top line.

Wow.  The Kaiser study also shows that the average individual market premium rose from $339 in 2016 to $490 in 2018 -- a 45% increase* over two years. That's driving a lot of unsubsidized people out of the market.

It's known, but has not been much emphasized, that the drop in unsubsidized enrollment through the ACA exchanges, is also sharp. Kaiser shows a drop from 1.6 million to 1.4 million in effectuated enrollment from March 2017 to March 2018. And as I noted recently, Kaiser chose not to estimate an undercount in CMS's report of effectuated enrollment in 2017 (the undercount is acknowledged in an endnote).

Subsidized ACA marketplace enrollment ROSE 2% in Maryland in 2018

ACA marketplace enrollment in Maryland for 2018 was down only slightly (2.6%) in 2018 That's a strong performance, as I noted earlier this week, "given the shortened enrollment period, radically cut federal funding for enrollment outreach and advertising, and general confusion generated by administration sabotage."

I also speculated that the drop-off may have been concentrated in unsubsidized prospective enrollees -- the only ones materially hurt by the state's enormous premium spikes (which actually benefited subsidized enrollees by inflating subsidies).  That is in fact the case.

In 2018, 32,171 enrollees in on-exchange private plans in Maryland were unsubsidized, according to numbers sent to me by the Maryland Health Connection (the state's ACA marketplace). That's out of 153,584 total enrollees (21%). In 2017, as of the end of Open Enrollment, 38,903 were unsubsidized out of a total of 157,832 enrolled (25%), according to Public Use Files published by CMS.*

That is, subsidized enrollment for 2018 was up about 2% -- to 121,413, compared to 118,928 in 2017. That jibes with the Maryland exchange's reporting that African American enrollment was up 12%, Hispanic enrollment up 10%, and rural enrollment up about 10%.