Obamacare enrollment for 2020 is lagging behind last year’s numbers despite lower premiums and more insurers competing in the markets, and the finger-pointing has already begun.
Blame is being cast on Trump administration cuts in Affordable Care Act outreach and education, but the drop-off also could be related to reduced joblessness and more people enrolling in employer-based health plans, analysts and researchers say.
Sign-ups for ACA plans in the 38 states that use the federal HealthCare.gov system totaled 2,372,957 for the period from Nov. 1 through Nov. 23, the most recent numbers from the Centers for Medicare & Medicaid Services. That was about 2% lower than the 2,424,913 who enrolled from Nov. 1 through Nov. 24, 2018.
With two more weeks to go before open enrollment ends Dec. 15, there could still be a surge in enrollment that makes up the difference. But lower enrollment figures could negate the Trump administration’s boast that it has been able to reduce premiums by 4% and get 20 more insurers in the exchanges.
A decline in Obamacare enrollment would also exacerbate concerns over a recent jump in the number of people without health insurance. Almost 2 million more people in 2018 lacked coverage than in 2017, according to the Census Bureau.
Cuts in Outreach, Sign-ups Help
The biggest challenges this year result from “actions taken by the Trump administration—lack of awareness and misinformation,” Joshua Peck, former chief marketing officer for HealthCare.gov in the Obama administration and co-founder of Get America Covered, said in an interview. Get America Covered helps people obtain health coverage, and Peck tracks enrollment.
The Trump administration has cut the ACA outreach and advertising budget by 90% from $100 million during the Obama years, and it has cut enrollment assistance funding by 80% to $10 million.
Those actions have contributed to only 5% of uninsured people knowing that the deadline to sign up is Dec. 15, as well as a perception that coverage is more expensive than it really is if you qualify for subsidies, Peck said.
About 87% of the 10.6 million people enrolled through the ACA marketplaces in 2019 received premium subsidies, according to the Centers for Medicare & Medicaid Services.
Technical problems experienced by HealthCare.gov on the weekend of open enrollment appear may have reduced enrollment by about 100,000 people, but those problems appear to be largely resolved, Peck said. Still, “the real test is going to be really once we get into December and we see traffic sort of pick back up,” he said.
The CMS said in an emailed statement that “there are many factors that influence enrollment each year,” and it’s not possible to make a direct comparison to previous years’ enrollment numbers.
This year’s open enrollment reports also reflect one fewer day than last year, the CMS said.
Lower unemployment may also be a factor in reduced enrollment, Andrew Strohman, health-care data analyst at American Action Forum, said in an interview. The American Action Forum, a center-right policy think tank, published a recent analysis saying the 2020 ACA market is stabilizing.
Unemployment is now about 3.6%, compared with 4% in January. “You could see some more people taking up employer-sponsored insurance rather than enrolling in the individual market,” Strohman said.
ACA enrollment is likely to decline even among people who receive subsidies, David Anderson, a research associate at the Duke-Margolis Center for Health Policy at Duke University, said in an interview.
Utah, Idaho, Virginia, and Maine are expanding Medicaid under the ACA, which will pull “tens of thousands” of people out of the marketplaces, said Anderson, who co-authored a paper on ACA trends.
While lower premiums help people who don’t receive subsidies, they are also likely to depress enrollment among people who receive subsidies, Anderson said. “This is counter-intuitive,” he acknowledged.
Lower premiums mean subsidies are lower for benchmark plans on which the subsidies are based, “so a lot of people will be seeing slightly higher premiums in 2020 than they were seeing in 2019,” he said. “That might be worth a couple percentage points of enrollment.”
Impact of Short-Term Plans
The biggest unknown for 2020 is the impact of short-term health plans, which don’t comply with ACA requirements to provide comprehensive benefits and not discriminate against people with pre-existing conditions, Anderson said. Trump administration regulations that make it easier to market the short-term plans were issued in October 2018.
The plans are being “aggressively marketed,” Anderson said.
Insurers selling the plans have had a year to ramp up their marketing efforts, and “those plans should be attractive to reasonably young, reasonably healthy individuals because they’re much less expensive than ACA plans,” especially for higher income people who don’t qualify for substantial subsidies, he said.
Democrats have charged that the short-term plan regulations may pull healthy people out of the ACA market, which could result in higher costs for those plans.
Seth Teich, senior vice president and general manager of individual and small business markets for health insurance web broker eHealth Inc. said in an interview that sales of the short-term plans are not likely to affect ACA enrollment.
eHealth, based in Santa Clara, Calif., sells health plans on the ACA marketplaces as well as plans that don’t meet the ACA’s coverage requirements. eHealth reported major medical individual and family plan membership of more than 131,000 people as of Sept. 30.
“Even though prices are down modestly, if you’re unsubsidized, they’re still unaffordable for a lot of folks,” Teich said of ACA plans. Those consumers must choose between having no coverage or having a plan that will provide some level of catastrophic care, he said.