7 Things to Know as ACA Open Enrollment Kicks Off
By Emily Payne | November 01, 2018 at 10:56 AM
It's officially November, and we all know what that means: just a few more days of political ads! But it also marks the kickoff of open enrollment for ACA marketplace health insurance plans. Consumers will have six weeks (or longer, in some states) to select an insurance plan for 2019.
For those working in health insurance and its adjacent industries, this is all common knowledge, but it’s news to 79 percent of Americans. It’s no surprise the number is so high, given the overwhelming number of changes to the ACA over the last year.
In anticipation of the rampant confusion that will undoubtedly plague this year’s ACA enrollment, Kaiser Family Foundation recently held a press briefing to discuss some of the key issues and highlights they’re watching this year.
For those advising consumers on ACA exchange plans or considering one for themselves, here’s a look at what to expect.
1. More companies are offering plans on the exchanges
The bulk of the new changes announced in recent months have yet to take an effect on the ACA market, which has been surprisingly stable, making it more attractive to insurers. In fact, many are starting to realize decent profits from their involvement.
“We’re seeing over a dozen insurance companies entering or reentering the exchange,” said Cynthia Cox, director for KFF’s program for the study of health reform and private insurance. “While insurers are changing their footprints within states, I’m not aware of any that have exited entirely. This is a complete 180 from a year ago.”
She noted that the repeal of the individual mandate could have a positive effect on the pool of potential insurance applicants, making it a bit safer for insurers to compete on the exchange.
2. Premiums overall are dropping…
The news headlines in recent weeks have touted the lower ACA premiums many will pay this year, but only about half of those going to the marketplace for health insurance will cash in. There’s significant variation across states, Cox said. “Premiums are dropping in a little over half of states, but increasing in almost as many. This is because insurers are not profitable everywhere.”
The drop in premiums comes after significant increases in premiums last year when insurers were unsure how the market would play out. The increased profits of those companies who overreacted to the market are now resulting in decreases.
“Tennessee insurers were among the most profitable last year,” Cox noted, raising rates more than 50 percent. “So they’re overpriced and dropping.”
3. …But not as much as they could be
Though there is some delayed effect, changes to the ACA continue to have an impact on premiums. The KFF team estimated that the repeal of the individual mandate and the introduction of looser plan regulations have kept premiums from dropping to lower levels.
“For many insurers, we were able to see exactly how much they’re adding into their premiums due to repeal of the individual mandate,” Cox said. “We found that on average, insurers are adding about 6 percent.
She continued, “When you add in the Trump administration’s decision to stop making CSR payments, which the CBO estimates add about 10 percent, that suggests that silver premiums are about 16 percent higher than they otherwise would have been.”
People purchasing ACA plans will feel the impact differently. Those buying off-exchange won’t be hit by the effects of the CSR payment loss, but those buying unsubsidized coverage will feel a greater impact from the premium increases. “Middle income and upper middle income people have been priced out of the market,” Cox says.
4. Tax credits will be lower
For many insured, the decrease in premiums won’t correlate to an equal increase in savings. “Because the premium tax credits are tied to the benchmark premium, if that premium decreases, so will the tax credit,” said Jennifer Tolbert, KFF director of state health reform.
This means that the nearly 20 percent of people on the federal ACA marketplaces who auto-renewed their policies for 2018 might want to take a closer look for 2019 to make sure they’re getting the best value.
“It will be more important than ever that consumers come back to the marketplace to shop for a new plan,” Tolbert said. “Active shopping is still the best way to ensure the consumer selects the most affordable plan to meet their needs.”
Speaking of taxes, the penalty for not having health insurance was done away with by last year’s tax reform package, and the list of exemptions for not having insurance has expanded.
That doesn’t mean uninsured individuals will get off Scot-free. Many states have introduced their own mandates.
Massachusetts, New Jersey and Washington, D.C. have enacted individual mandates (and Vermont’s will take effect in 2020). Several states, including Washington, Minnesota and California and Hawaii are also considering their own mandates.
5. Watch out for short term plans
With the loosening of regulations on short-term plans, more consumers may be curious to learn about them, and more insurers may be offering them. While they may sound attractive to some individuals, KFF senior fellow Karen Pollitz noted some caveats. “These policies are not guaranteed renewable. People who buy a policy and then get sick will probably not be able to extend, and they cannot enroll in marketplace policies after they’re dropped. They must wait for open enrollment.”
These short-term plans can also cause confusion among consumers shopping for full coverage. “With the changes under the new regulations the short-term plans are allowed to adopt features that make them look more similar [to traditional plans,” Pollitz said. “In addition, if the word ‘renewable’ or ‘extension’ pops up, that might echo a marketplace policy.”
While all plans listed on HealthCare.gov will meet the current ACA requirements, consumers shopping on private sites might encounter short-term plan offerings without realizing what they are.
“Direct enrollment sites can and often do sell other products, including short term policies,” Pollitz cautioned. Such sites may often be used by consumers working with brokers, she added, noting that roughly 40 percent of HelathCare.gov enrollments were broker assisted in 2018.
On such sites, consumers need to pay extra attention to the details of the plan they’re considering to make sure it’s what they’re actually looking for.
6. Beware last-minute to enrollment snags
The federal ACA exchange deadline is December 15. As in years’ past, some states have extended the deadline, and those in hurricane-ravaged areas will also have access to special enrollment extensions.
“The exceptional circumstances special enrollment period is now what they’re calling the hurricane SEP,” Pollitz said, noting that those with a non-hurricane-related special circumstance may also call and request an extension.
Still, consumers waiting until the last minute to enroll might run into some complications. Use of signup sites tends to surge as the deadline approaches, creating technical hiccups and lag times for enrollees.
Consumers’ coverage could also be delayed because of issues with their previous year’s coverage. Consumers who received a tax credit for 2017 but did not file a tax return would not be denied tax credits in 2019. “Consumers may regain eligibility for tax credits by filing 2017 tax return, but must do so before the open enrollment deadline,” Tolbert said.
“Consumers who want to renew with the same insurer may need to repay any outstanding premium debt,” Tolbert added. “If they are unable to repay, they may enroll in a plan with another insurer.”
7. Assistance is limited
The funding for federal navigators has been reduced 84 percent from 2016 levels, according to KFF research, meaning help will be limited or unavailable to many consumers. Many navigator programs are using new strategies to reach further, including virtual enrollment events and group enrollment appointments.
Assistance for consumers in state-run marketplaces may look different, as well. “The navigators or assistors are generally available in state-run marketplaces, though hey maybe be called something other than navigators,” Tolbert says. “We have not looked extensively this year at the availability across states, but it is required that some sort of in person assistance be available in all states.