The assessment comes after HHS has put months of effort into attracting young, uninsured adults, including those who have previously paid a penalty for not being insured and those who are likely eligible for financial assistance.
Rates will be higher, and insurers will be fewer, but the point person for the final open enrollment period of the Affordable Care Act before President Obama leaves office insists that the numbers will climb.
HHS Secretary Sylvia Mathews Burwell said in a news conference Wednesday that about 1 million more people would sign up for coverage this fall and more would stay covered. This will include more Americans who are eligible for financial help on the Marketplace but seek coverage elsewhere. HHS predicts an enrollment increase from 12.7 million to 13.8 million people during the upcoming open enrollment period: an increase of 9%.
Separately, HHS expects 11.4 million enrollees will pay premiums on the market each month in 2017, up from 10.5 million this year.
“Building a new market is never easy,” Burwell said, as she presented the HHS estimates for 2017. “We expect this to be a transition period for the marketplace. Issuers are adjusting their price, bringing them in line with actual data on costs.”
For months, federal health officials have focused their effort on the remaining 27 million people who remain uninsured more than 6 years after the ACA passed and more than 3 years after the first open enrollment period of the exchanges. Of this group, 10.7 million are eligible for Marketplace coverage and 85% could receive financial assistance.
HHS efforts will target the 5.1 million people eligible for Marketplace coverage who currently buy it elsewhere, including 2.5 million that its analysts believe could be eligible for financial assistance.
After a disastrous rollout in 2013, the problems with the ACA Marketplace have shifted. While it’s easier to sign up today, prices are higher, and in many parts of the country, few options are offered, leading to renewed calls for a “public option.” Insurers who underpriced coverage in markets with which they had little familiarity are now adjusting prices based on experience, and many have left states completely. Eighteen of the 23 co-ops designed to offer low-cost coverage have failed due to design flaws that required them to shift enormous sums to other insurers under risk-adjustment formulas; one, in Maryland, is shifting to for-profit status to survive.
While the Blue Cross Blue Shield Association has been among those questioning the stability of the individual market, a report this week in Kaiser Health News asked whether the structure of the risk adjustment formula had unfairly benefited the Blues in several states. The formulas are supposed to help insurers that take on larger shares of sicker patients, but smaller, newer companies say the system unfairly benefits larger, less efficient companies.
The ACA has also created a wave of mergers and attempted mergers across healthcare, which some say have limited the choices that the law was supposed to create. The Department of Justice has trials scheduled for late November and early December to block mergers of Aetna and Humana and Anthem and Cigna. Many saw Aetna’s decision to withdraw from all but a handful of states earlier this year as a response to the Justice Department’s opposition to its merger.
HHS figures show that 40% of those eligible for financial assistance on the Marketplace are 18 to 34 years old; insurers on the Marketplace need more in this age group to enroll to balance the costs of older, sicker enrollees on the exchanges. Observers and critics have said the penalties for failing to sign up were not tough enough to attract this age group, and that it’s little wonder than many in this age group have chosen to pay penalties instead. In the wake of the 2008-2009 recession, many young adults are still paying off student loans and earning low salaries, and do not find health coverage a worthwhile expenditure.
This fall, HHS has responded with new efforts to attract young adults under age 35, including reaching out to those who have paid a penalty for not having coverage.
While everyone expects premiums to be higher, just how high won’t be known until days before voters go to the polls November 8, 2016, to elect the next president. The ACA has had some attention in the campaign, with Republican Donald Trump calling for the law to be repealed and Democrat Hillary Clinton saying it needs to be improved. But it has not been a focal point of the election, and it got limited attention at the very end of Wednesday night’s third and final presidential debate.
In her remarks, Burwell acknowledged that the ACA has traveled a bumpy road, but she said the administration has had to overcome constant attempts to repeal or overturn the law, efforts she said “would turn back the clock to the world that existed before the Affordable Care Act.”
“We can’t look backwards in a hopeless search for alternatives that aren’t viable, or just don’t exist. What we do have is an opportunity to build on our historic progress.”