7 Reasons Why We Can Expect a Spur in Enrollment

Despite post-election uncertainties surrounding the healthcare reform laws, the Centers for Medicare & Medicaid Services (CMS) and the Internal Revenue Services (IRS) are pushing full steam ahead to enroll more people.

The Department of Health and Human Services (HHS) is expecting 13.8 Million to sign up for coverage – a 9.9 percent rise compared to the 12.7 Million who gained coverage last year [1].

So far over 3 Million have selected coverage during the first 30-days of Open Enrollment, through the health insurance marketplace [2]. This includes more than 300,000 consumers who  selected plans within the three days following the presidential election [3].

Here are 10 reasons why we can expect this years’ enrollment to grow:

  1. Penalties– The IRS has enhanced their efforts aimed at enrolling consumers into coverage, under the current health laws. By targeting those that opted to pay the tax penalty in previous years, the agency is gearing up to send a series of notices to tax filers, including more than 800,000 between Nov 28 and Dec 5, and an additional 6.7 Million during the month of January  [4]. In 2016 the individual mandate penalty is $695 per uninsured adult and $347.50 per child (up to $2,085 per household) or 2.5 percent of household income above the tax-filing threshold, whichever amount is greater.

 

  1. Discounted Premiums– While uncertainties fringe on the amount of financial assistance that consumers could anticipate to receive in future years, those who qualify could become safeguarded from premium increases using available subsidies to offset their costs. This year alone, more than 84 percent, or 8 in 10 qualified health plan (QHP) eligible consumers, are estimated to qualify for advanced premium tax credits (APTC) [1].  Approximately 57 percent will qualify for cost-sharing reductions (CSR), in addition to APTC [1] and the remaining 16 percent have family incomes above 400 percent FPL [1]. Taking financial assistance into consideration, more than 70 percent of consumers can find marketplace plans for less than $75 per month and 77 percent will be able to find plans with premiums below $100, according to HHS [5].

 

  1. Pre-existing Conditions– Pre-existing conditions or health histories are no longer a barrier to enrollment and President-elect Trump has vowed to keep this provision untouched. In the individual market, pre-existing conditions have historically resulted in declined applications, exclusion riders, and/or higher premiums. For consumers, this means that:
    • No insurance plan can reject, charge more for, or refuse to pay essential health benefits for any condition [6]
    • Once a consumer is enrolled, the plan cannot deny coverage or raise your rates based on your health conditions [6]
    • Medicaid and the Children’s Health Insurance Program (CHIP) cannot refuse to cover or charge a consumer more for their pre-existing conditions [6]

 

  1. Millennials– Millennials represent a healthier population, in comparison to older and more likely sicker consumers – and represent an opportunity for health insurance companies to stabilize their risk pools and transfer reduced costs and premiums to their members. During the months leading up to the start of Open Enrollment, significant outreach led by President Obama’s Administration and CMS was conducted to reduce the number of uninsured young adults. The Department of Health and Human Services (HHS) estimates that more than 40 percent of QHP-eligible uninsured individuals are aged 18-34 [1].

 

  1. Brokers & Agents– Brokers and agents have played a pivotal role in the Affordable Care Act’s success and will continue to flaunt their positive impact on enrollment this year. During the 2015-2016 open enrollment period:
    • Brokers and agents enrolled nearly half of all marketplace enrollments [8];
    • Nearly half of all marketplace applications last year were recorded using alternative enrollment platforms (26 percent insurance company website & 23 percent Web Broker (WBE) websites) [1]; [8]
    • On average, each broker assisted 110 consumers with applications for marketplace coverage [8]; and
    • 55 percent of brokers surveyed agreed that OE3 outperformed OE2 in overall results [8].

 

  1. Basic Health Program (BHP)– The Basic Health Program (BHP) was established under the Affordable Care Act. Through BHP, States can create a health benefits coverage program for their low-income residents, gaining the ability to provide more affordable coverage options and improved care delivery. So far, Minnesota and New York have elected to implement BHPs – with Minnesota’s program beginning January 1, 2015, and New York’s program beginning April 1, 2015 [9]. In addition to the 13.8 Million enrollees, HHS is anticipating that an additional 650,000 consumers will purchase coverage through Minnesota and New York’s Basic Health Programs (BHP) this year [1].

 

  1. On- and Off-Exchange Enrollment – This year, HHS is expecting that 8 Million individuals will gain – renew or purchase for the first time – coverage through the marketplace, including 9.2 Million re-enrollees, 3.5 Million uninsured individuals, and 1.1 Million individuals with 2016 off-exchange coverage [1]. As examined earlier, this is a 9.9 percent rise in state and federal on- and off-exchange enrollment, compared to the 12.7 Million that gained coverage last year [1].

 

[1] https://aspe.hhs.gov/pdf-report/marketplace-enrollment-projections-2017
[2] http://acasignups.net/
[3] http://www.wsj.com/articles/affordable-care-act-enrollment-surges-following-trump-election-1478808902
[4] http://www.washingtontimes.com/news/2016/nov/27/irs-assures-no-privacy-violated-as-it-lures-new-cu/
[5] https://www.hhs.gov/about/news/2016/10/24/more-70-percent-consumers-can-find-marketplace-plans-less-75-month.html
[6] https://www.healthcare.gov/coverage/pre-existing-conditions/
[7] http://cbt.regtap.info/cbt/regtap/AB_CY17Kickoff_5CR_072616/story.html
[8] http://kff.org/health-reform/report/2016-survey-of-health-insurance-marketplace-assister-programs-and-brokers/
[9] https://www.medicaid.gov/basic-health-program/index.html

The views and opinions expressed by the authors on this blog website and those providing comments are theirs alone, and do not reflect the opinions of Softheon, Inc. (dba Welltheos).

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Yvonne Villante
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Yvonne Villante

Senior Research Manager, Healthcare Reform at Welltheos
As our Senior Research Manager, I work closely with our Solution Architect, Product Management, and Sales teams. My role centers around competitive and market analyses, constructing premium content (whitepapers, research briefs, infographics), curating stories for our newsletters, and blogging.

I earned my BAA from the State University of New York at Stony Brook and MBA in Healthcare Administration from the University of Ohio (Athens). I was born and raised on Long Island, NY and enjoy capturing what the island has to offer through photography.
Yvonne Villante
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