Enrollment in Affordable Care Act health plans is at an all-time high. More than 2.5 million Americans signed up for an ACA plan during the special enrollment period the Biden administration initiated in February to ensure individuals had access to coverage during the pandemic. This brings the total number of people covered by an ACA plan to 12.2 million, compared with 11.4 million in 2019.
The special enrollment period wrapped up on Aug. 15, and the 2022 open enrollment period begins Nov. 1. Federal and state policymakers have implemented various changes both to allow consumers more time to sign up and to improve health insurance affordability.
Open enrollment is the annual period when individuals who purchase their own health insurance may sign up for a new plan, change their current coverage or re-enroll in their current plan. Consumers will shop for coverage on marketplaces, or exchanges, established by the ACA.
More Time to Enroll
Under a final rule from the Department of Health and Human Services, the open enrollment period will run for 30 additional days to Jan. 15, 2022. Many states that maintain their own marketplaces also extended their open enrollment periods.
In addition to extending the regular open enrollment period, the final rule established a new monthly special enrollment period for individuals with incomes at or below 150% of the federal poverty level. During years when federal lawmakers set premium contributions to $0 for this population, individuals who meet the income threshold requirement may enroll in a marketplace plan outside the normal open enrollment period. Some researchers note this opportunity may be most helpful for those poised to lose Medicaid coverage once the public health emergency ends.
Stable Premiums and Higher Subsidies for Many Enrollees
Compared with earlier years, when insurers posted significant premium rate increases, health insurance premiums for ACA marketplace plans remained relatively stable heading into 2022 open enrollment. An analysis by the Kaiser Family Foundation of premium rate filings across all 50 states and Washington, D.C., found mostly moderate, single-digit rate changes from 2021 to 2022. Despite larger swings in premium rates for some health plans, at least half the proposed rate changes fell between a 1.8% decrease and a 6.2% increase.
Most consumers will also receive additional premium assistance due to the American Rescue Plan Act. ARPA extended tax credit eligibility to those earning more than 400% of the federal poverty level and made subsidies more generous for consumers across all income levels.
For those earning above the 400% level, ARPA limits premiums to no more than 8.5% of annual income. Many consumers with incomes between 100% and 150% of the poverty level will have health plan options with no premiums. The enhanced ARPA subsidies are temporary for 2021 and 2022.
States Run Their Own Marketplaces, Focus on Affordability
Thirty-three states rely on the federally facilitated marketplace for ACA open enrollment, and consumers in these states will shop for health plans using www.HealthCare.gov. Seventeen states and Washington, D.C., operate their own marketplaces and enrollment websites.
Three of the 17—Kentucky, Maine and New Mexico—launched marketplaces for the 2022 open enrollment season. Virginia plans to follow suit for 2023 open enrollment. Policymakers noted that transitioning to a state-based marketplace will allow for more control over outreach and enrollment efforts and result in cost savings to the state and consumers.
States have also leveraged several strategies to drive down premium and cost-sharing requirements for enrollees. Fifteen states received federal approval and funding to implement a reinsurance program, which shields insurers from high medical claims and lowers premiums for consumers ineligible for subsidies. States including Colorado and Georgia tailored programs to improve health insurance affordability in rural areas.
Some states—such as California and New Jersey—provide state-financed premium subsidies based on income. Maryland is in the process of implementing a young adult subsidy pilot program to make health insurance more affordable for those between 18 and 34—the age group with the highest uninsured rate in Maryland and across the U.S.
Some researchers have noted that the temporary tax credits may mean state strategies focused on premium affordability are less necessary, since the ARPA subsidies make premiums more affordable for all income earners. Colorado is discussing funneling state subsidies toward cost-sharing obligations rather than premiums. New Mexico enacted legislation to establish both premium and cost-sharing subsidies and to waive cost-sharing requirements for behavioral and mental health services and treatment.
However, many states are taking a wait-and-see approach before initiating major changes to their programs while Congress debates making the tax credits permanent.
Jack Pitsor is a policy associate in NCSL’s Health Program.