Nearly 950K Enrolled in Fed Exchange Since Open Enrollment Ended

California Healthline, Friday, August 14, 2015

Nearly 950,000 U.S. residents have selected health plans through the federal exchange since the Affordable Care Act’s open enrollment period ended in February, the Wall Street Journal reports (Armour, Wall Street Journal, 8/13).

Background

Individuals who have “qualifying life events” — such as moving to another state, getting married, having a new child, losing previous coverage or becoming a U.S. citizen — are eligible to enroll in exchange coverage within 60 days of such events, even if it is not during the open enrollment period (Wilson, “Road to Reform,” California Healthline, 4/9). Further, individuals who are no longer eligible to remain on their parents’ health plans also can enroll in exchange plans outside of the ACA’s open enrollment periods.

Individuals Enroll for Various Reasons

The figure accounts for individuals who selected exchange plans between Feb. 23 and June 30 in states that use the federal exchange for enrollment (Wall Street Journal, 8/13). The data do not reflect whether the individuals have paid their first month’s premiums, which effectively completes the enrollment process (Sandler, Modern Healthcare, 8/13).

According to CMS:

  • 50% of the enrollees selected exchange plans because they lost other health coverage;
  • Almost 20% did so because they discovered they did not qualify for Medicaid (Wall Street Journal, 8/13);
  • 16% enrolled because of another qualifying life event (Howell, Washington Times, 8/13); and
  • 15% enrolled in exchange plans during a special open enrollment period coinciding with this year’s tax season.

CMS noted a large portion of the enrollees were under age 35, suggesting such individuals were using the exchange because they:

  • Experienced life changes, such has having a child or getting married;
  • Changed jobs; or
  • Were no longer eligible to remain on their parents’ health plans (Wall Street Journal, 8/13).

According to Modern Healthcare, Florida and Texas had the largest shares of such enrollees, with 160,828 and 131,757, respectively (Modern Healthcare, 8/13).

Obama Admin On Track To Hit Enrollment Goals

According to the Wall Street Journal, the additional enrollees put the Obama administration on track to meet its goal of enrolling 9.1 million to 9.9 million U.S. residents in exchange coverage by the end of this year. Kevin Counihan, CEO of HealthCare.gov, in a statement said the new enrollments are “further evidence that the health insurance marketplace is working for America’s families” (Wall Street Journal, 8/13).

Tax-Related Sign Ups Could Mean Individual Mandate Is Working

Meanwhile, the number of individuals who selected health plans during the tax-related special open enrollment period could show the ACA’s individual mandate is working, National Journal reports (Scott, National Journal, 8/13).

The administration in February announced the special open enrollment period for individuals who could confirm they:

  • Did not know about the individual mandate penalties until they prepared to file their taxes this year;
  • Owed the federal government a penalty for not having coverage in 2014; and
  • Did not currently have a federal exchange plan.

The special open enrollment period ran from March 15 to April 30 and only applied to residents in states that relied on the federal exchange for enrollment. Individuals who signed up during the special open enrollment period still owed last year’s penalty of $95 or 1% of their household income, whichever was higher. However, the special open enrollment period allowed them to avoid the 2015 penalty of $325 or 2% of household income (California Healthline, 4/21).

According to National Journal, the number of U.S. residents who selected health plans during the special open enrollment period spiked on the April 30 deadline. Overall, 143,707 people enrolled through the tax-related special enrollment period, with 38,000 of those individuals enrolling on April 30. Those figures could suggest that individuals were enrolling because of penalties they could have faced under the individual mandate.

The mandate could further drive enrollment as its penalties grow larger. According to National Journal, individuals who do not comply with the mandate in 2016 face penalties of $695 or 2.5% of their incomes, whichever is higher.

Larry Levitt, senior vice president at the Kaiser Family Foundation, said, “I think 2016 will be the first real-world test of a tough individual mandate” (National Journal, 8/13).

Source: California Healthline, Friday, August 14, 2015