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January 20, 2022 Health/Employee Benefits News No comments
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ACA Enrollment Rose To Record Levels

By Press Release

By Katherine Hempstead, senior policy advisor, Robert Wood Johnson Foundation

Enrollment in the ACA marketplace has risen to record levels, with at least 14.2 million plan selections reported ahead of the January 15th deadline, when open enrollment ends in most places. This reflects a combined total from the 33 states that use the healthcare.gov platform along with the 18 state-based marketplaces. This year’s open enrollment period (OEP), follows closely on an extended special enrollment period which stretched through much of 2021. The expanded premium tax credits implemented in the American Rescue Plan Act of 2021 remain in place, boosting affordability and capping premiums as a share of income. While it is not yet clear how much new enrollment will result from the OEP itself versus the prior special enrollment period, the year over year increase in membership is nevertheless impressive, currently estimated at approximately 20 percent.

Each year, the Robert Wood Johnson Foundation looks at what is happening with insurer participation in the ACA marketplace. Our updated interactive map shows county level participation over time by consumer brand name, parent company, and insurer classification. Selecting any county shows a list of participating plans.

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Insurer Participation Is Still Growing, But A Little More Slowly

The number of county level exchange offerings has increased each year since 2019. Initially, issuer participation increased while enrollment was essentially flat. This year, we see more robust growth in enrollment, but some moderation in issuer participation trends.

While the total number of plan offerings increased about one third in 2021 (from 10,289 to 13,596), this year’s increase to 15,638 constitutes growth of about 15 percent. Additionally, there is a notable shift toward the marketplace, with the number of exchange offerings growing 20 percent versus only 6.8 percent for off-exchange only plans. Data from states that use the healthcare.gov platform show that the average number of plans available per enrollee has quadrupled between 2019 and 2022, leading CMS in the recent payment rule to propose plan standardization, in light of a “proliferation" of choices available to consumers on the Exchanges that makes it more difficult to meaningfully assess all available plan options.”

The number of off-exchange-only plans has been increasing since 2020, though it has not come close to its historic highs and was overtaken by the number of exchange offerings in 2018. The number of off-exchange offerings increased only a little this year, on the heels of a much larger increase (about 50%) in 2021. Insurer strategy around off-exchange plans is not consistent. Among the national carriers, most growth in the segment this year came from Oscar and Bright Health. Others, like Centene, United Health, Cigna, and Anthem, added few or no off-exchange plans, after having made large increases in 2021. The new American Rescue Plan Act (ARPA) provisions, which increase both eligibility for subsidies and their generosity, would be expected to reduce demand for plans in the unsubsidized off-exchange segment. On the other hand, the potential to attract enrollees from the group market through the individual coverage health reimbursement account (ICHRA) mechanism could be a motivation to invest in this segment. Enrollment in off-exchange plans is notoriously hard to measure, yet a recent estimate for 2021 suggests it may be about three million.

Who’s New

Ascension. The Ascension health system is selling marketplace plans in Kansas (Wichita area), Michigan (Detroit area) and 30 counties in Indiana. The plans are underwritten by US Health and Life Insurance Company. This is the only new entry in the fairly sleepy but not insignificant segment of provider-sponsored plans.

Medicaid Managed Care Organizations (MCOs). The synergies between Medicaid and the ACA marketplace are ever more apparent, with two new Medicaid MCOs coming to the marketplace—AmeriHealth Caritas in North Carolina, and The Health Plan in West Virginia.

Who’s Back

CVS/Aetna. CVS/Aetna returned to the marketplace this year, offering plans in eight states—Arizona, Florida, Georgia, Missouri, Nevada, North Carolina, Texas, and Virginia. While the new participation may seem like a lot, it is worth recalling that at their height, Aetna had nearly 4,000 county offerings in almost 30 states. Today, Aetna is taking a comparatively modest foray into a little more than 300 counties. In Texas, Aetna will be in only 13 counties; in Florida six. The Arizona entry is a joint effort with the Banner system and will be limited to just three counties. This is consistent with the pattern exhibited by United Health Group, when they recently returned to the marketplace in a very slimmed down form. With Aetna’s entry, nearly all of the major national health insurers have returned to the marketplace, with only Humana remaining on the sidelines.

Other Moves

In addition to a statewide move into Nebraska, market leader Centene also made modest entries into four other states, including New Jersey, which hadn’t had a new insurer since Oscar returned to their market in 2018. United Health entered seven new states. Molina made modest entries into Idaho, Illinois, and Kentucky. Cigna entered Georgia and Pennsylvania. Anthem made very few changes in their participation and did not enter any new states.

Oscar and Bright Health expanded their presence this year and now occupy 21 and 16 states, respectively. Oscar had a statewide move into Nebraska, and also participated in co-branded “Cigna+Oscar” plans in Missouri, Kansas, and Tennessee. They also entered Arkansas and Illinois. Bright Health increased their service areas in North Carolina and Tennessee, and entered California, Illinois, Texas, Utah, and Virginia. Both Oscar and Bright Health had IPOs this year, and both had challenging third quarters, struggling with high medical costs. The smaller Friday Health Plans nearly doubled their offerings this year and entered Georgia, North Carolina, and Oklahoma.

Short-Term Focus On States That Didn’t Expand Medicaid 

Enrollment growth this year has so far been greatest in the 12 states that have not expanded Medicaid. This makes sense, because the population with incomes between 100 percent and 138 percent of the federal poverty level (FPL) can enroll in the marketplace, and take advantage of newly affordable silver plans, thanks to new ARPA subsidy provisions. If the coverage gap fix proposed in the Build Back Better legislation becomes law, those with incomes below 100 percent FPL will also be able to enroll in marketplace plans. More generally, uninsurance rates are higher in non-expansion states, suggesting there is a greater source of potential marketplace enrollees.

For these reasons, non-expansion states, especially Georgia and North Carolina, remain the top destinations for plans that are entering new states or expanding their footprint. In North Carolina, the number of offerings grew from 278 to 508, an increase of 83 percent. This year, five insurers entered Georgia (Aetna/CVS, Bright Health Plan, Cigna, Friday, and UnitedHealth) and three (Aetna/CVS Health, AmeriHealth Caritas, and Friday) entered North Carolina.

The Longer Run

Yet not all expansion is directed to the non-expansion states. It may be surprising to learn that Nebraska now has four statewide insurers. The state was plagued early on by market problems, leading Senator Ben Sasse (R) in 2016 to complain about limited choice and castigate the ACA as a “European-style centrally-planned boondoggle.” By 2018, Medica was the state’s only plan, but this year Oscar and Centene will join Bright Health and Medica to make four. With total state marketplace enrollment that will likely hover around 100,000 in 2022, and a reasonably low uninsurance rate, this proliferation of supply raises interesting questions about what kinds of scale can work for plan participants, or what their expectations may be for the future.

In the short-to-medium run, the most likely prospect for enrollment growth will come from the coverage provisions in the Build Back Better Act and redeterminations out of Medicaid as the public health emergency unwinds. These trends may take longer than anticipated to materialize, due to both headwinds with the legislation and the persistence of the pandemic. Much of this potential growth will take place in the non-expansion states, which is where recent increases in insurer participation have been concentrated.

Yet the enrollment opportunities from these policy changes are not infinite. In the longer run, if there is substantial growth in the individual market, it may well be more geographically dispersed. While plans may be focusing now on areas where uninsurance rates are high, they may also be positioning themselves for the future, when more significant and widespread enrollment growth may come from the employer market, or when growth must come through capturing market share. News from Medicare Advantage insurers suggests that competition is constraining membership growth for some plans. Whether this becomes a factor in the individual market depends on both participation trends and the potential for market growth.

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