ACA marketplace enrollment in Covid-19 season: Flat? Up a million? Both?
As millions of Americans lose job-based health insurance during the pandemic months, Medicaid, bolstered by the ACA Medicaid expansion, has served as a far more potent protection against becoming uninsured than the ACA marketplace, for several reasons:
As family incomes crash, about twice as many newly unemployed and uninsured become eligible for Medicaid as for subsidized marketplace coverage, according to Urban Institute calculations (2.4 times as many in expansion states; 1.6 times as many in nonexpansion states). Medicaid eligibility is determined on a current monthly basis, while marketplace subsidies are calculated on the basis of estimated annual income.
The emergency extra $600/week unemployment insurance provided for up to four months (now expired) by the CARES Act does not (did not) count with respect to Medicaid eligibility, but did count in calculation of marketplace subsidies, severely weakening them (it continues to count, since the relevant measure is annual income).
The Families First Act effectively required states to suspend income redeterminations and disenrollments in Medicaid for the duration of the emergency. In the marketplace, people pay premiums and so disenroll themselves when the premiums become a hardship.
While Medicaid enrollment is year-round, marketplace enrollment outside of the annual Open Enrollment Period (Nov. 1 -- Dec. 15 in 38 HealthCare.gov states, somewhat longer in most state-based marketplaces) requires a Special Enrollment Period (SEP), granted to those who lose coverage or report other "life changes," such as divorce or childbirth. Applying for a SEP entails extra administrative burden. While 12 of 13 state-based marketplaces opened emergency SEPs easing or eliminating that burden, HealthCare.gov did not -- though the federal exchange did suspend the need for pre-enrollment documentation of the reason the SEP should be granted.
Unemployment may drop a significant number of marketplace enrollees into Medicaid eligibility.
Result: Medicaid enrollment has increased by about 6 million, or 9% through August, while ACA enrollment is probably close to flat. Perhaps that's not a fair measure, since monthly attrition in the marketplace is a norm -- and appropriate, since serving as a stopgap is an important marketplace function. From January to September 2019, total marketplace enrollment dropped by almost exactly a million, from 10,498,207 in January to 9,490,318 in September (see p. 11 here). Thus, if total marketplace enrollment were flat from January through September, that could be viewed as an increase of a million compared to ordinary times.
Avalere Health has forecast on the basis of early SEP data that enrollment will increase by a million this year as a result of the pandemic. The report does not address attrition. If enrollment is down by 400,000 from January through December the forecast would be accurate, based on last year's attrition. The increase would be reflected in average monthly enrollment compared to last year's, recorded in each year's first effectuated enrollment snapshot for the prior year.
We don't yet have a second quarter effectuated enrollment snapshot for the ACA marketplace. We do have some tidbits, though. From January through May, SEP enrollment in the 38 states using HealthCare.gov was 188,000 thousand higher than in 2019 according to a CMS report (effectuated enrollment in February 2019 and February 2020 was almost identical). In Covered California, CA's ACA exchange, which held an emergency SEP open from March 20 to August 31 and advertised extensively, SEP enrollment was up by 167,700 compared to same period 2019 (California marketplace enrollment is about 19% of HealthCare.gov's). Even more striking, total effectuated enrollment in California was higher in June (1.53 million ) than in March, (1.42 million). That's a 7.7% increase, whereas the excess SEPs in HealthCare.gov states through May would only cover about a third of "normal" attrition at the 2019 pace.
Two more tidbits. Via Charles Gaba, in Maryland, which held an emergency SEP this spring on the heels of a special tax season SEP meant to encourage the uninsured, total individual market enrollment (including off-exchange) increased by 2.6% from February 29 through June 30. In New Jersey, which uses HealthCare.gov and could not open an emergency SEP, total individual market enrollment is down 1.76% from the first quarter to the second.
Two tentative hypotheses, then: 1) the emergency SEPs opened by state-based exchanges may had a real impact, though the their effectiveness may have varied according to how frictionless they were; and 2) any increase in marketplace enrollment won't do much more than offset normal attrition (which totaled about 13% from January to December in 2019), and may do less. California is probably an outlier in this regard -- which is odd, because it's also an outlier in weak Medicaid enrollment during the pandemic.
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Afterthought: perhaps the buried lede here is that California's second quarter increase in enrollment is quite something.