ACA sign-ups hit all-time top with a month of open enrollment remaining

The Biden administration announced a week ago that enrollment in ACA marketplace plans had reached an all-time high of 13.6 million* by December 15, with a month still to go in the open enrollment period (OEP) for 2022 in many states.

That's an increase of about 2 million (17%) over enrollment by the same date last year, based on Charles Gaba's estimate, and well above the previous high of 12.7 million recorded as of the end of open enrollment for 2022, which lasted until January 31 in many states. When OEP ends next January, enrollment in marketplace plans will exceed 14 million.

92% of marketplace enrollees in HealthCare.gov states received health insurance subsidies

In the 33 states while using federal exchange, HealthCare.gov (that the federal government provides more detailed statistics than in the 18 state-based exchanges), almost all enrollees (92%) received premium tax credits (subsidies) to assist pay for coverage – including 400,000 who would not have access to qualified for subsidies prior to passage in March of the year of the American Rescue Plan (ARP). That bill not only increased premium subsidies at each income level through 2022, but additionally removed the previous income cap on subsidies, which was 400% from the federal poverty level (FPL) ($51,520 per year for a person and $106,000 for any group of four). In 2022, no enrollee who lacks use of other affordable insurance pays more than 8.5% of revenue for any benchmark Silver plan (the second cheapest Silver plan in each area), and most pay much less.

The enrollment increase is tribute to the huge boost in affordability developed by the ARP subsidies. A benchmark Silver plan with strong Cost Sharing Reduction (CSR, mounted on Silver plans for low-income enrollees) is now free at incomes as much as 150%FPL ($19,320 for a person, $39,750 for any family of four in 2022) and charges a maximum of 2% of revenue ($43/month for a person) at incomes as much as 200% FPL. The proportion of revenue required for the benchmark Silver plan was reduced at higher incomes too. The ARP also provided free high-CSR Silver coverage to anyone who received any unemployment insurance income in 2022.

The American Rescue Plan boosted enrollment throughout 2022 and into 2022

The enrollment gains during OEP build on the enrollment surge triggered through the emergency special enrollment period (SEP) opened by the Biden administration on February 15 of this year, which ran through August 15 within the 33 states using HealthCare.gov, and for varying periods in the 15 states that ran their own exchanges in 2022. (Nowadays there are 18 state-based exchanges, as Kentucky, Maine and New Mexico launched new ones for 2022.)

The ARP subsidies came online in April (or May in some state marketplaces). From February to August, 2.8 million people enrolled during the SEP, and total enrollment increased by 900,000 on net from February to August (as people also disenrolled each month, and many enrollees doubtless regained employer-sponsored coverage during a period of rapid job growth).

In addition, once the ARP subsidy increases entered effect, 8 million existing enrollees saw their premiums reduced by an average of 50%, from $134 to $67 per month. Enrollees' premiums in 2022 should be similar to those of the SEP.

Enrollment growth was concentrated in states which have not expanded Medicaid

Enrollment increases during open enrollment – as during the SEP and the OEP for 2022 – were heavily concentrated in states that have not enacted the ACA expansion of Medicaid eligibility. There have been 14 such states during most of the SEP and 12 during the (still current) OEP, as Oklahoma belatedly enacted the Medicaid expansion from July of this year, and Missouri in October.

In non-expansion states, eligibility for ACA premium subsidies begins at 100% FPL, while in states that have enacted the development, marketplace subsidy eligibility begins at 138% FPL, and Medicaid is available below that threshold. In non-expansion states, industry may be the only route to coverage for most low-income adults, and people who report incomes below 100% FPL mostly get no help at all – they're in the notorious coverage gap. In those states, about 40% of marketplace enrollees have incomes below 138% FPL – that's, they'd be signed up for Medicaid if their states enacted the development.

During OEP, these 12 non-expansion states account for 81% of the enrollment gains within the 33 HealthCare.gov states, contributing to two-thirds of enrollment gains in all states. The table below also shows gains over a two-year period, encompassing the results from the COVID-19 pandemic.

In the 39 states which have enacted the ACA Medicaid expansion (21 on HealthCare.gov and 18 running their very own exchanges), far fewer enrollees are eligible free of charge Silver coverage. In expansion states, eligibility for marketplace subsidies begins in an salary of 138% FPL, as people below that threshold are eligible for Medicaid. Nevertheless, enrollment growth in non-expansion states during the current OEP is substantial, increasing by about 755,000 year-over-year, or 13%.

The marketplace is a pandemic 'safety net'

The marketplace is a bulwark against uninsurance throughout the pandemic, among low-income people especially as well as in the non-expansion states in particular. As shown in the chart above, enrollment during these 11 states increased by 1.8 million from Dec. 15, 2022 to Dec. 15, 2022 – a 37% increase. For those states, the two-year increase is incorporated in the neighborhood of 25% and can approach 3 million (from 11.4 million in OEP for 2022 to above 14 million when OEP for 2022 leads to January). That's along with a rise of more than 12 million in Medicaid enrollment during the pandemic.

While millions of Americans unemployment once the pandemic struck, and millions fewer are utilized today compared to February 2022, the uninsured rate didn't increase during 2022, based on government surveys, and may even convince have downticked during 2022 or 2022 once the data is available in.

While the government has not yet published detailed statistics as to who has enrolled throughout the current OEP, they did achieve this in the final enrollment report for the emergency SEP. Throughout the emergency SEP, out of 2.8 million new enrollees, 2.1 million were within the 33 HealthCare.gov states. In those states, 41% of enrollees obtained Silver plans with the highest level of CSR, meaning they'd incomes under 150% FPL (or received unemployment income) and so received free coverage in plans with an actuarial value of 94% – far above standard for employer-sponsored plans.

The median deductible obtained in HealthCare.gov states was $50, which makes sense, as 54% of enrollees obtained Silver plans with strong CSR, raising the plan's actuarial value to either 94% (at incomes up to 150% FPL) or to 87% (at incomes between 150% and 200% FPL). Two-thirds of enrollees in HealthCare.gov states paid less than $50 per month for coverage, and 37% obtained coverage free of charge.

At higher incomes, as noted above, 400,000 enrollees who received subsidies in HealthCare.gov states will not have been subsidy-eligible before the ARP lifted the income cap on subsidies (previously 400% FPL). The same is also doubtless true for several hundred thousand enrollees in state-based marketplaces. The SBEs account for a bit less than a third of enrollment, however in those states, all of which have expanded Medicaid, the percentage of enrollees with income over 400% FPL is nearly twice that of the HealthCare.gov states (12% versus 7% during the emergency SEP).

ARP: an area for that coverage gap?

The strong enrollment development in non-expansion states – an increase of 37% in 2 years – indicates that during the pandemic, some low-income individuals those states found their way to avoid it of the coverage gap (brought on by the possible lack of government help open to most adults with incomes below 100% FPL). In March 2022, the CARES Act (H.R.748) provided supplementary uninsurance income of $600 each week for approximately four months to some wide range of people who had lost income during the pandemic, likely pushing many incomes over 100% FPL. In 2022, anyone who received any unemployment income qualified for free Silver coverage, and during the emergency SEP, 84,000 new enrollees took advantage of this provision (together with 124,000 existing enrollees). That emergency provision is not essentially in 2022, however.

Marketplace subsidies are based on an estimate of future income. For low-income people in particular, who're often paid by the hour, work uncertain schedules, depend on tips, or are self-employed, income can be challenging to project. The need to be insured throughout the pandemic might have spurred some applicants to make sure their estimates cleared the 100% FPL threshold. (Enrollment assisters and brokers might help applicants deploy every resource to meet this goal.)

For OEP 2022, the Biden administration raised funding for nonprofit enrollment assistance in HealthCare.gov states to record levels, enough to train and certify more than 1,500 enrollment navigators. This past spring, in compliance with a court order, the exchanges stopped requiring low-income applicants who estimated income over 100% FPL to provide documentation when the government's “trusted sources” of information indicated an income underneath the threshold.

Comparatively weak enrollment growth in Wisconsin may support the hypothesis that pressurized from the pandemic, some enrollees in other non-expansion states are climbing from the coverage gap. Alone among non-expansion states, Wisconsin has no coverage gap, because the state provides Medicaid to adults with incomes up to 100% FPL (rather than as much as the 138% FPL threshold needed by the ACA Medicaid expansion, that provides enhanced federal funding to participating states). In Wisconsin, those whose income falls underneath the 100% FPL marketplace eligibility threshold have access to free coverage. Wisconsin is the only non-expansion suggest that didn't experience double-digit enrollment development in OEP 2022 or from 2022-2022.

The way forward for increased subsidies is unclear

The American Rescue Plan was conceived as emergency pandemic relief, and its increased subsidies run only through 2022. President Biden's Build Back Better bill, which passed in the home of Representatives but is currently stalled within the Senate, would extend the ARP subsidies through 2025 or possibly further.

The large rise in enrollment this season should add pressure on Congress to extend the improved subsidies into long term. Consumer reaction to the increased subsidies has proved immediate and dramatic. The ARP subsidy boosts brought the Affordable Care Act much closer than ever before to living as much as the promise of “affordable” care expressed in the name. Going backwards on that promise should not be seen as a politically viable or ethical path.

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* Another million people are signed up for Basic Health Programs established underneath the ACA by Minnesota and New York – low-cost, Medicaid-like programs for state residents with incomes under 200% FPL. Enrollment in these programs is on the right track to increase by 13% this season, according to Charles Gaba's estimate.

** HealthCare.gov all-state totals are for that 33 states while using federal exchange this season. Source: Charles Gaba, OE snapshots as of mid-December, 2022-22, 2022-2022; see also CMS end-of-OEP snapshots for 2022, 2022, 2022

Andrew Sprung is a freelance writer who blogs about politics and healthcare policy at xpostfactoid. His articles about the Affordable Care Act have appeared in publications including The American Prospect, Health Affairs, The Atlantic, and The New Republic. He's the winner of the National Institute of Healthcare Management's 2022 Digital Media Award. He holds a Ph.D. in English literature in the University of Rochester.