President Joe Biden on Thursday ordered HHS to create a special enrollment period to allow people to sign up for a health plan through Affordable Care Act marketplaces and reexamine policies like Medicaid work requirements that make it more difficult for individuals to access or afford coverage.
HHS will allow individuals to enroll in coverage through HealthCare.gov from Feb. 15 to May 15. Ordinarily, signing up for an exchange plan is tightly restricted outside a six-week period late each year.
"The SEP will be offered to consumers applying for new coverage or updating an existing application through HealthCare.gov, the marketplace call center or through direct enrollment channels. Coverage is prospective, with coverage beginning the first day of the month following the date of plan selection," HHS said in a statement.
The executive order told federal regulators to look into policies that could undermine protections for people with preexisting conditions, undercut the individual marketplace or reduce coverage affordability or financial assistance. CMS will revisit Medicaid and ACA demonstrations and waivers that decrease coverage or "undermine the programs."
"I like this broader language as lockouts, premiums are also problematic barriers," tweeted Joan Akler, executive director of Georgetown University's Center for Children and Families.
She added that the executive order's language includes "a clear nod to getting rid of the 'family glitch,' " referring to a technical issue that makes it difficult for some low-to-moderate-income families to get financial help to buy marketplace coverage.
Former CMS Administrator Seema Verma made Medicaid work requirements central to her effort to modify the program. Proponents argued the waivers would encourage people to work and ensure people didn't receive benefits if they didn't qualify for them. Of the 13 states CMS approved for a work requirement, Arkansas was the only state to completely implement its experiment. A federal court struck down the demonstration after seven months, and a federal appeals court agreed. A Health Affairs study found that more than 18,000 people, or nearly 1 in 4 people covered by the waiver, lost their coverage, with profound adverse effects on their finances and medication adherence.
According to the Center on Budget and Policy Priorities, it's "unavoidable" for Medicaid work requirements to cause large coverage losses, even among people who are working or should be eligible for exemptions. That's because the requirements make it more difficult for individuals to stay enrolled. Arkansas' policy didn't boost employment either. There's evidence to suggest that having health coverage makes it easier to work, rather than work requirements encouraging people to work.
"A tragic example from Arkansas shows that state work policies can have the opposite impact: a working beneficiary misunderstood the new reporting requirements, lost his coverage, couldn't fill a prescription and lost his job due to deteriorating health," CBPP said in a statement.
Manatt Health managing director Jocelyn Guyer said the Biden administration could probably "unravel" waivers for Medicaid work requirements and Tennesee's block grant quickly since those policies aren't in effect.
Verma's CMS tried to tie the Biden administration's hands earlier this month when it sent letters to state Medicaid agencies to get them to sign contracts making it harder for regulators to unwind approved waivers. But many experts don't think the move will work. Guyer called the move "sloppy."
The Trump administration refused to create a special enrollment period during the pandemic, despite requests from providers, insurers, consumer groups and Democrats to do it. A number of states reopened their own exchanges shortly after the crisis began to alleviate concerns people without insurance would be reluctant or unable to access care during the COVID-19 pandemic.
"We applaud the call for a targeted special enrollment period that is accompanied by robust consumer outreach and education ... We also support the elimination of barriers for low-income adults to obtain Medicaid coverage, which is particularly essential in the midst of a pandemic," America's Health Insurance Plans CEO Matt Eyles said in a statement.
The Kaiser Family Foundation found that opening the exchange opens coverage access to 15 million people, 4 million of whom qualify for a free plan under the ACA and 4.9 million eligible for subsidies to lower the cost of their coverage. The majority of those uninsured are disproportionately young adults, Latinx and hold a high school diploma or less, KFF said.
Since making the announcement, California, Colorado and a few other states have already announced plans to extend their enrollment periods to May 15.
Ceci Connolly, CEO of the Alliance of Community Health Plans, noted that states that reopened their exchanges for special enrollment periods earlier in the pandemic did not see significant changes to their risk pools. Experts had worried that higher-risk, sicker individuals would enroll in large numbers, while lower-risk, healthier people wouldn't. But that didn't happen.
Manatt Health managing director Joel Ario, a former HHS official and state insurance commissioner, said the new special enrollment period could pose less risk to insurers since underinsured people would be able to apply for coverage
Still, Connolly said the order would force insurers to accept a greater number of beneficiaries than they originally planned, adding some uncertainty into payers' pool of risk. The announcement comes as the industry reckons with how costs related to the coronavirus and consumers' deferred care from the previous year will play out in 2021, she said. Insurers that serve as the only option in an area's exchange will be disproportionately impacted by the extension of the enrollment period and uncertainty over COVID-19 costs, she said. KFF found that 10% of counties have a single insurer offering in 2021.
As a way to manage risk, Connolly expects payers to increase their outreach to enrollees about the importance of preventative care and the availability of virtual care.
"Insurance companies are no good to anybody if they run out of money," Connolly said. "Especially in a year with COVID, where you've got a big, giant question mark, it really strains the ability of actuaries to do a good job forecasting and pricing."
Dr. Glenn Melnick, a professor at the University of Southern California, does not expect the move to make a huge impact on insurers' bottom lines since many of the states already reopened their exchanges for special enrollment periods earlier in the year. Those who needed insurance already signed up, he said.
"I don't think it'll have a very big impact, but I think it's the right thing to do for people whose lives are turned upside down," Melnick said.
He expects the majority of new enrollees to have lost their insurance because they're recently unemployed, or those who live in states that haven't expanded Medicaid, like Texas, which boasts the nation's highest uninsured rate. In 2019, KFF reported that more than 18% of Texans lacked insurance.
Trump's moves to cut marketing for the ACA and funds used to hire navigators to enroll individuals did not help increase access to coverage. Melnick said that he expects the federal government to infuse cash and attention to this special enrollment period. Manatt Health's Ario said the money could help insurers attract younger, lower-risk people than they have in the past.
"The broader the audience you reach, from an insurer's perspective, the more likely you are to get a healthy mix," Ario said
At some point, he also expects the Biden administration to refocus its energy on increasing the subsidies offered to individuals and potentially create a public option.
"The clouds have gone away, and there's some sunlight," Melnick said.
L.A. Care Health Plan CEO John Baackes said that the insurer essentially acts as a public option for the nearly 2.4 million members it covers in Los Angeles County, representing 23% of the city's population. The payer serves as the largest publicly operated health plan in the U.S. and offers the cheapest exchange plan in the region, he said.
Since its exchange plans represent just 4% of the not-for-profit's overall business or about 100,000 enrollees, Baackes doesn't expect the extension to have a huge impact on the insurer's bottom line. But the federal government should look to California as a model for how to properly operate the ACA. He said California kept its open enrollment period available for triple the amount of time the federal exchange was open, reinstated the tax penalty for consumers lacking coverage and made subsidies available for those earning 400% above the federal poverty line.
"If you want to see what a public option looks like, come visit us here in Los Angeles," Baackes said.
The Biden administration also will overturn the global gag rule or "Mexico City Policy," which bans international not-for-profits from receiving U.S. funding if they provide abortion counseling or referrals.
