Where Obamacare Thrives
Enrollment in the ACA’s exchanges dipped to 12.2 million this year. At first blush, the picture looks bleak. But Modern Healthcare found that several states using the federally operated marketplace are doing just fine.
Percentage change in ACA enrollment by county
Mouse over to see every U.S. county's ACA enrollment
While enrollment on the Affordable Care Act’s federal marketplaces dropped almost everywhere this year, Utah was a spot of hope for Obamacare supporters.
The politically conservative state added 21,000 members during the 2017 open enrollment period that ended Jan. 31, the most out of any other state using the federally operated marketplace, HealthCare.gov. Utah’s total enrollment reached more than 197,000 members, a 12.3% increase over last year. Only one of the 29 counties in Utah saw a decrease in enrollment.
The Utah Health Policy Project, which helps people sign up for coverage, said much of the growth is concentrated in the fast-growing, family-focused suburbs of southern Salt Lake County and Utah County. These communities have a high population of members of the Church of Jesus Christ of Latter-day Saints. It’s not uncommon for some families to have seven or eight kids, said Jason Stevenson, the non-partisan organization’s education and communications director and ACA policy leader.
And thanks to the structure of the ACA’s subsidies, which are based on both income and family size, many of these moderate-income families received financial help to purchase insurance. Under the ACA, a family of eight with a household income of six figures can qualify for financial assistance on the exchanges, Stevenson said. Children below age 18 account for 25% of Utah’s exchange enrollment—the highest rate in the nation.
These families count on health insurance and build it into their budgets. “Utahns love a good deal,” Stevenson said. “If you have a family of five or six kids you are cutting coupons. The ACA is the best coupon you can find.”
In the face of ACA repeal, exchange enrollment in many states declined as expected. Total enrollment in the federal and state-based exchanges dropped by 500,000 people to 12.2 million in 2017. On the surface, those numbers seem to tell a story of the marketplaces’ demise.
Percentage change in enrollment by county
in Utah exchange
But that’s not actually the case. In some states like Utah, the exchanges are working just fine and enrollment has jumped to their highest levels yet. Many states held steady, give or take a few percentage points. And in the state where enrollment fell the most, it’s likely because people switched to Medicaid and received cheaper coverage, health insurance experts say.
“There’s a much bigger concern if there's a precipitous decline (in enrollment), which could be the sign of things spiraling out of control. And that's not the case in the vast majority of the country,” said Larry Levitt, senior vice president of the Kaiser Family Foundation.
Another bright spot on the map, rural South Dakota, grew enrollment by almost 14% over last year to just over 29,600 people. The state has seen steady growth in the past three years.
The Community HealthCare Association of the Dakotas, which runs the state’s Get Covered South Dakota website, said outreach and messaging was a huge factor. Facebook ads, brochures and presentations at community hospitals and health centers helped boost enrollment.
“There’s been a real dedicated effort,” said the association’s CEO Shelly Ten Napel. It also helps that 88% of the state’s exchange members receive premium subsidies to help offset any increases in plan rates. Average benchmark premiums before financial assistance increased by 39% this year in South Dakota, according to HHS data.
Percentage change in enrollment by county
in Louisiana exchange
Meanwhile, in Louisiana enrollment plummeted by 33% over 2016. That’s the largest decline in enrollment by percentage of any HealthCare.gov state. But it’s likely because ACA plan members switched to Medicaid for cheaper insurance when the state expanded the program last year.
The ACA allowed states to extend Medicaid to adults with incomes up to 138% of the federal poverty level. Louisiana’s Democratic Gov. John Bel Edwards last year took the Obama administration up on that offer. Louisiana—historically one of the poorest and least-insured states in the nation—became the first state in the Deep South to expand Medicaid.
Marketplace enrollment dropped by more than 70,500 members, while the state’s Department of Health said Medicaid enrolled 400,635 new members.
“That's not a signal that the markets are destabilizing,” Levitt said. “There's a big shift from the marketplaces to Medicaid. It's simply putting Louisiana on the track of the other states that have already expanded Medicaid.”
The same trend occurred in 2015 when Indiana and Pennsylvania expanded their Medicaid programs and subsequently experienced declines in ACA enrollment.
It’s a pretty good deal: Studies have shown that states that expanded Medicaid to low-income people had lower marketplace premiums. Lower-income individuals are typically less healthy than those with high-incomes. By moving them to Medicaid, the federal exchange is “a smaller market but probably a healthier one,” Levitt said.
Among all the states using the HealthCare.gov platform, 9.2 million people enrolled, compared with 9.6 million the year before. About 3 million people enrolled in states that operate their own marketplaces, down from with 3.1 million. Enrollment dropped in most of counties. Last year, enrollment increased nearly everywhere.
It’s not hard to see why fewer people signed up in 2017. On the campaign trail, President Donald Trump promised voters he would repeal former President Barack Obama’s signature healthcare law. Unsure of whether the exchanges or the individual mandate requiring people to buy coverage would be around much longer, many would-be healthcare shoppers sat this open enrollment out, observers say.
The Obama administration pushed hard for people to sign up for coverage. Then upon entering office, Trump took his foot off the gas. His administration pulled advertisements and outreach emails meant to encourage people to enroll on HealthCare.gov during the final week of open enrollment, when large numbers of people typically choose plans. One recent Health Affairs study showed that repeated television advertisements are linked to increases in health insurance enrollment.
“The more you invest in messaging and advertising and outreach, the bigger the return,” said Sabrina Corlette, a health insurance expert at Georgetown University.
At the same time, consumers may have decided not to enroll because of premium sticker shock or because their health insurer stopped selling plans. Many health insurers, including UnitedHealth, Humana and Aetna, have scaled back their participation or completely exited the insurance exchanges, citing financial losses. Some insurers, however, have managed to turn a profit.
Considering the many obstacles consumers faced, it is “remarkable” that some states managed to enroll more people this year even with the “incredibly negative rhetoric” and the fact that open enrollment landed right after the presidential election, Corlette said.
It’s a safe bet that enrollment in the exchanges will decline even more next year, if the House Republicans’ bill to repeal the ACA passes. The American Health Care Act would get rid of the individual mandate and change up the premium tax credits so they are based on age, rather than income. The tax credits will be less generous for many older, low-income Americans. The bill would also slash Medicaid funding and phase out the enhanced federal funding for the Medicaid expansion.
The Congressional Budget Office estimates that 24 million people will lose insurance over the next decade if the legislation is enacted.
Back in Utah, the Stevenson’s organization expects that the ACA repeal bill’s change to the tax credits will lead many Utahns to drop their insurance. The Utah Health Policy Project predicts that co-pays and deductibles for 72% of Utah residents enrolled in marketplace insurance will rise.
The bill would also allow insurers to charge a 30% premium penalty for one year for individuals who have let their coverage lapse. That will prevent many lower-income Utahns from enrolling in insurance again.
So Stevenson said his organization is now counseling people to hold onto their coverage. The consequences are now much higher. “Get things done now while you can, because we don’t know what’s going to happen,” he explained.
He’s also concerned that the Utah Health Policy Project won’t have time to focus on improving healthcare quality and reducing costs. “If this bill does become law, we are going to have to try to protect people from losing their coverage,” Stevenson said.
Source: Modern Healthcare analysis of CMS data and ASPE Office of Health Policy