At last minute, private plan enrollments spike

By: Emily Makings
12:00 am
April 2, 2014

Monday was the last day to sign up for health insurance and avoid a penalty under the Affordable Care Act (ACA). As expected, there was a spike in enrollments in qualified (private) health plans (QHP) just before the deadline.

Yesterday the Washington Health Benefit Exchange released enrollment numbers through March 31 (Medicaid numbers are through March 27). Since the last report, 21,290 people enrolled in a QHP. (Adjusting by days covered in each report, this week’s report had the highest average number of enrollments per day.) According to the Exchange, 8,000 of those came on March 31.

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Since October 1, QHP enrollments total 146,497. (Note that the Washington Exchange, unlike many — if not all — other exchanges, only counts enrollments that have submitted payment.) Enrollments by those newly eligible for Medicaid under the ACA’s expansion total 268,367. Enrollments by those who were previously eligible for Medicaid but had not signed up total 135,485. (People may enroll in Medicaid throughout the year.)

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Although open enrollment is now over (with some exceptions), there are still a number of open questions. How many of these enrollees were previously uninsured? Did enough “young invincibles” sign up? (We’ll know more on that when the Exchange releases its detailed March enrollment report.) What will be the budgetary impacts of the new Medicaid enrollees for the state?

On that last question, the National Association of State Budget Officers recently released a “Health Care Toolkit for State Budget Officers.” Some relevant points:

. . . many states continue to experience growth in Medicaid spending that exceeds the rate of growth of the state’s economy (even after controlling for the impact of the end of the enhanced federal Medicaid matching rate that was in effect through June 2011). Disentangling the factors influencing state-level Medicaid trends will also be quite difficult moving forward, and as the provisions of the ACA take effect, state budget officers recognize that significant budgetary uncertainties are likely to remain for some time. Chief among these will be related to projecting enrollment growth.

States that have chosen to expand Medicaid eligibility beginning in 2014, as well as those that have not, will be subject to significant uncertainties related to take-up and participation rates both for those newly eligible and those previously eligible but not enrolled; the impacts of eligibility simplifications, health insurance exchanges, and publicity; and changes in the mix of Medicaid enrollees (e.g., children, parents, aged, individuals with disabilities). Other cost impacts related to the ACA’s essential benefit set for all newly eligible adults, pressure to increase provider payments to mitigate access issues, and the potential for decreased use of other state safety net and mental health programs will also take time to fully understand. To add further complexity, a large program such as Medicaid does not always have a smooth spending pattern and payments for services may not align directly with a given fiscal year. . . .

State general fund spending on other health care programs could be reduced with more limited impacts on consumers if Medicaid coverage to the expansion group provides an acceptable substitute. Places to look for savings would include state-only funded programs for the poor and near-poor uninsured such as uncompensated care pools for hospitals and other safety net providers; high-risk pools; mental health and substance abuse programs and grants; inpatient health care for prisoners; and even public employee and retiree coverage. . . .

Some type of Medicaid welcome-mat effect has long been anticipated, but there has been limited research evidence to date to help estimate its size. This issue is a particular concern for states, because although the ACA funds 100 percent of the costs associated with newly-eligible Medicaid enrollees from 2014 through 2016 (eventually phasing down to 90 percent), there will be no enhanced federal match rate for Medicaid enrollees who would have qualified under previous Medicaid rules.

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