There is now less than a week to go before the end of the Affordable Care Act’s (ACA’s) first enrollment period. The mainstream media will be filled with what journalists call “thumbsucker” stories—news analyses of how we got to where we are and what it all means.
Larry Levitt, MPP
March 31, 2014, is a significant milestone. This is the last date (more or less) that people who are uninsured can sign up for a plan in the individual insurance market or in the ACA’s health insurance exchanges (people who have a transition—for example, a job loss—will still be able to enroll, and Medicaid enrollment continues throughout the year). It is also the deadline to get insured and avoid a penalty under the law’s so-called individual mandate.
Much of the focus over the next few weeks will undoubtedly be on the total number of people signing up on the exchanges. The point of comparison will be either the 7 million exchange enrollees for the first year of the ACA that the Congressional Budget Office (CBO) projected last May or the 6 million enrollees they predicted in February after the technologically troubled launch.
As Drew Altman, president and chief executive officer of the Henry J. Kaiser Family Foundation, recently wrote, there is a big difference between a projection done for budget estimation purposes and a target, but it is perhaps not surprising that this single number has taken on outsized significance as a yardstick for the law. It’s an easy metric to understand and enrollment numbers are being reported monthly by the federal government.
Enrollment reached 5 million by the middle of March and could potentially exceed 6 million by the end of the month with an expected surge in deadline-induced enrollment. This would likely enable some to declare victory, whereas others will point to the fact that not all of those millions have paid their first month’s premium and are therefore not technically insured.
The ACA has many aims, and any law this complex will also have unintended consequences, both good and bad. However, if there is one overarching goal of the law, it is to decrease the number of uninsured individuals in the United States, which stood at 48 million in 2012. Unfortunately, measuring this effect will take time, and it goes well beyond simply looking at the number of people signing up in exchanges, for reasons such as:
It is likely the case that not all of the people signing up on exchanges were uninsured at the time they enrolled. Almost half of those who bought their own insurance before the ACA are eligible for tax credits in the exchanges, which may have proven attractive to them.
People can continue to buy insurance on their own outside of the exchanges, with substantially similar consumer protections. Some people who were previously uninsured and locked out of the insurance market due to preexisting conditions may be buying off-exchange coverage, particularly if they have incomes over 4 times the poverty level and are therefore ineligible for ACA premium subsidies. There is no regular reporting of that enrollment, so we have no way of knowing how large it may be.
Millions of people are enrolling in Medicaid, which about half of states have chosen to expand under the ACA. Some of these Medicaid enrollees are newly eligible for the program or were already eligible but encouraged to enroll due to the publicity surrounding the launch of the ACA (known as the “woodwork effect”). However, others are simply renewing coverage or enrolling due to life transitions that have occurred irrespective of the health reform law. It’s the net increase in Medicaid enrollment that really matters for reducing the ranks of the uninsured, but the data do not exist yet to do that tabulation.
Most insured Americans get their coverage through an employer. Although that is not expected to change much this year as employers wait and see how the law shakes out, even a small change in the share of employers offering health insurance to their workers could produce a large change in the number of people needing to look for alternative forms of coverage.
Recent polling from Gallup provides a hopeful sign that the law may be reducing the number of people who are uninsured. However, it is an imperfect measurement tool. The poll carries a margin of error of plus or minus 1% (using a 95% confidence interval), so it could be off in its estimate of the recent decline in the uninsured by millions of people. One can see the volatility in the survey’s results by looking at counterintuitive changes in recent years that do not seem to match with what we know is happening in the health insurance system, such as an increase in the proportion of adults uninsured during the first three-quarters of 2013, at a time when the economy was improving.
We will likely not have a clear picture of how the number of uninsured has changed until results from large federal surveys like the National Health Interview Survey, the Survey of Income and Program Participation, and the Current Population Survey become available, which will probably be this fall at the earliest.
As with any new program, the expectation is that it will take several years for enrollment in exchanges and Medicaid to ramp up and for the uninsured rate to drop substantially. But, of course, the proof will be in the pudding: Do people perceive the coverage as affordable and a good value? Will the individual mandate ultimately be effective at encouraging people to enroll?
Additionally, the experience across states will almost certainly vary tremendously for reasons that the framers of the ACA didn’t anticipate. The Supreme Court decision that made the Medicaid expansion voluntary for states has meant that millions of poor adults are left in a “coverage gap” and will remain uninsured. And, the fact that the law has remained politically divisive has left many states not invested in its success and some actively engaged in undermining it.
The end of open enrollment is a significant milestone for the ACA, and we will continue to learn more about how the law is affecting people, health care professionals, hospitals, and employers. But, regardless of what the pundits say, there won’t be a single judgment day for the ACA as experience unfolds across the country.
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Larry Levitt, MPP Larry Levitt, MPP, is Executive Vice President for Special Initiatives at the Kaiser Family Foundation (KFF) and Senior Advisor to the President of the Foundation. Among other duties, he is Co-executive Director of the Kaiser Initiative on Health Reform...