During the inaugural year of Affordable Care Act, the second half of the enrollment period was marked by sustained consumer interest and a large increase in enrollments as compared to the first half. When all enrollees were tallied after enrollment ended, government data indicated that 73% of enrollees had been acquired in the second half of the enrollment period.1 HealthPocket investigated whether this trend had continued this year or if changes in consumer behavior emerged in the 2015 annual enrollment period.
HealthPocket examined several data sources, starting with key internal data used to measure consumer interest in Affordable Care Act insurance. The internal data examined was collected from the beginning of the second annual enrollment period, November 15, 2014, through the end of the enrollment period, February 15th, 2015. HealthPocket found that consumer interest (as inferred from these internal measures) was down dramatically in the second half of the annual enrollment period. The level of consumer interest in Affordable Care Act insurance, as measured by this HealthPocket data, was over twice as high in the first half of the enrollment period as as it was in the second half. The second half of the enrollment period, when compared to the first half, evidences a significant waning in consumer interest.
Unsurprisingly, enrollment behavior has also evidenced a ‘front-loading’ this year. As illustrated in the government chart2 below, the first half of the enrollment period (through December 31, 2014) had approximately six million enrollees for the federal exchange, Healthcare.gov.
By early February, the number of Healthcare.gov enrollees had only risen to 7.5 million according to Sylvia Burwell, secretary of Health and Human Services.3
This year’s enrollment period is quite different than last year’s. Aside from being only half as long as the 2014 enrollment period,4 there are two more significant factors that affect consumer interest activity and enrollment behaviors in 2015.
The first of these factors is “auto-enrollment.” For the 2015 enrollment season, the government automatically re-enrolls Healthcare.gov consumers in the same Affordable Care Act plans they had purchased in 2014. This auto-enrollment will also continue premium subsidies at the same levels as the prior coverage period.5
The effect of auto-enrollment on consumers who purchase their own insurance is likely significant. The government has reported that only 42% of enrollees this season were ‘first time’ insurance buyers on Healthcare.gov.6 The remaining 58% had previously purchased insurance on Healthcare.gov and been auto-enrolled or actively re-enrolled on their own.7 Government officials predicted last June that the vast majority of 2014 federal exchange enrollees would be automatically re-enrolled for 2015.8
The second major factor changing consumer interest activity and enrollment behavior this year is the technical stability of exchanges as compared to 2014. Last year’s launch of both federal and state health insurance exchanges was marked by prolonged system problems that interfered with consumers’ ability to shop and enroll. Without these technical problems, 2015 people interested in purchasing their own health insurance are able to compare plans and submit health insurance applications without the need to repeatedly return to exchange web sites due to prior system failures.
Another factor affect consumer interest activity, perhaps not as influential as first two discussed, is that the fine for being uninsured doubles in 2015. While in 2014 the uninsured fine was 1% of household income (or $95 per person whichever was higher), the 2015 fine is 2% of household income (or $325 per person whichever was higher).9 The desire to avoid the fine may have influenced some consumers to enroll before January first, though technically the fine does not begin unless a person lacks “minimum essential coverage”10 for three months.11
At this time, the government has not yet announced the final enrollment numbers for the 2015 annual enrollment period. While government exchanges are expected to report a spike in enrollment activity in February as the enrollment period drew to a close, that spike is not expected to be of a magnitude to change the general front-loading trend noted in this publication. Consequently, the front-loading trend can be used as the basis for a refinement of the government’s proposal for shortening the annual period for 2016.
The government has proposed that the annual enrollment period for 2016 be shortened to October 1st through December 15th,12 making the 2016 enrollment period 76 days long as compared to this year’s 93 days. Given the current front-loading of consumer interest and enrollment behavior, it is reasonable to suggest that the enrollment period for 2016 be shortened even further. Consider the enrollment period for Medicare Part D and Medicare Advantage plans. It is only 54 days long despite the fact that it encompasses a much larger market of insurance enrollees.13 Moreover, Medicare insurance plans are associated with the senior demographic. Seniors are often less computer savvy and more in need of customer support than the younger demographic of the Affordable Care Act. Therefore, if Medicare can successfully use a 54-day enrollment period for Part D and Medicare Advantage plans, why couldn’t the Affordable Care Act also limit its enrollment period to a 54-day season?
The suggested reduction of the enrollment period to 54 days could also be combined with a change in start date to avoid the current overlap of the Affordable Care Act and Medicare enrollment periods. A move of Affordable Care Act enrollments to tax season would lessen the call center congestion at insurance companies that results from Obamacare calls coming at the same time as Medicare calls. The move of the Affordable Care Act enrollment period to tax season would also assist consumers in making the most informed health plan choice. The tax season is the period when consumers would presumably learn if any portion of last year’s subsidies must be repaid, if changes in income affect the level of health insurance subsidization, the amount of the uninsured penalty for those without an exemption regarding minimum essential coverage, etc. This information could help consumers make the wisest health plan choices for their personal circumstances.
1 Government enrollment data recorded 8,019,763 exchange plan selections for the Affordable Care Act's first enrollment period, of which only 2,153,421 were made between October 1, 2013 and December 28, 2013. Should be noted that there was an enrollment extension in many states that extended past the original March 31, 2014 end to the middle of April. The Department of Health and Human Services, Office of the Assistant Secretary for Planning and Evaluation.
"Health Insurance Marketplace: Summary Enrollment Report for the Initial Annual Open Enrollment Period." (May 1, 2014) p.4. http://aspe.hhs.gov/sites/default/files/pdf/76876/ib_2014Apr_enrollment.pdf Last accessed February 5, 2015.
2 "HEALTH INSURANCE MARKETPLACE 2015 OPEN ENROLLMENT PERIOD: JANUARY ENROLLMENT REPORT" Department of Health & Human Services. (January 27, 2015). p.5. http://aspe.hhs.gov/health/reports/2015/MarketPlaceEnrollment/Jan2015/ib_2015jan_enrollment.pdf. Last accessed February 4, 2015.
3 Secretary Burwell shared this information during testimony at a Senate hearing. Stephanie Armour. "Affordable Care Act Enrollment Near 10 Million." Wall Street Journal. (February 4, 2015). http://www.wsj.com/articles/affordable-care-act-enrollment-near-10-million-1423070147. Last accessed February 5, 2015.
4 For the 2014 plan year, the enrollment period lasted from October 1st through March 31st, with many consumers having an additional extension through April 15th. For the 2015 plan year, the enrollment period began on November 15th 2014 with its conclusion at February 15th 2015 (unless an extension or Special Enrollment Period is granted).
5 Dan Mangan. "Obamacare's 95% solution: Auto-enrollment, with subsidies." CNBC (June 26, 2014). http://www.cnbc.com/id/101793283. Last accessed February 4, 2015.
6 It should be noted that enrollment figures reported by the government at this time do not reflect whether the insurance plan was effectuated by payment of the first month's premium. "HEALTH INSURANCE MARKETPLACE 2015 OPEN ENROLLMENT PERIOD: JANUARY ENROLLMENT REPORT" Department of Health & Human Services. (January 27, 2015). p.4. http://aspe.hhs.gov/health/reports/2015/MarketPlaceEnrollment/Jan2015/ib_2015jan_enrollment.pdf. Last accessed February 4, 2015.
8 "The vast majority of people who enrolled in Obamacare on the federal health exchange will be both automatically re-enrolled in the health plans they selected in 2014 and automatically receive the subsidies to help pay for that insurance that they got this year, officials revealed Thursday." Dan Mangan. "Obamacare's 95% solution: Auto-enrollment, with subsidies." CNBC (June 26, 2014). http://www.cnbc.com/id/101793283. Last accessed February 4, 2015.
9 See "The fee you pay if you don't have health coverage" https://www.healthcare.gov/fees-exemptions/fee-for-not-being-covered/. Last accessed February 5, 2015.
10 http://www.irs.gov/Affordable-Care-Act/Individuals-and-Families/ACA-Individual-Shared-Responsibility-Provision-Minimum-Essential-Coverage Last accessed February 5, 2015.
11 "If you're uninsured for just part of the year, 1/12 of the yearly penalty applies to each month you're uninsured. If you're uninsured for less than 3 months of the year, you don't have to make a payment." https://www.healthcare.gov/fees-exemptions/fee-for-not-being-covered/ Last accessed February 5, 2015.
12 Tony Pugh. "HHS proposes new rule changes for 2016 marketplace coverage." McClatchyDC. November 21, 2014. http://www.mcclatchydc.com/2014/11/21/247785/hhs-proposes-new-rule-changes.html Last accessed February 5, 2015.
13 Medicare has approximately 54 million enrollees of which 37 million receive their drug coverage through Medicare Part D or Part C (i.e. Medicare Advantage) plans. The annual enrollment period for Medicare Part D and Part C plans is October 15 through December 7. "Medicare at a Glance." Kaiser Family Foundation. (September 2, 2014). http://kff.org/medicare/fact-sheet/medicare-at-a-glance-fact-sheet/. Last accessed February 5, 2015.
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