Federal PPACA health insurance exchanges attracted five times more growth than did state exchanges for the 2015 insurance year and experienced significantly less attrition among those enrolled last year.
That’s what an Avalere analysis of enrollment data reveals. The study raises as-yet-unanswered questions about why federal exchanges are more effective at retaining existing enrollees and attracting new customers. It also adds further evidence to the emerging trend that residents in states with a stronger federal presence are receiving better health care.
Avalere reported that federally run exchanges retained 78 percent of 2014 enrollees and grew by a total of 61 percent compared to the number covered in 2014. State exchanges retained 69 percent of enrollees and grew by 12 percent overall for 2015.
“It’s unclear why state-based exchanges saw higher year-over-year attrition among their enrollees,” Avalere said. “One possibility is that state exchanges had more enrollees who over-reported income in 2014. For instance, California shifted about 200,000 exchange enrollees into Medicaid for 2015. However, it’s unclear why state-run exchanges would have disproportionately experienced such corrections.”
Another factor could be the initial technical difficulties the federal website experienced in its first year of operation.
“Some of the higher 2015 enrollment may be attributed to initial technological issues with HealthCare.gov that may have depressed 2014 enrollment, however that alone doesn’t explain why state-run exchanges did so poorly, relative to the federally-facilitated exchange states,” said Caroline Pearson, senior vice president at Avalere.
Yet the federal presence does seem to have its own effect. Earlier studies have shown that, in states where Medicaid expanded, more residents found health insurance, and care for those with chronic diseases like diabetes, showed improvement compared to the states that decided not to expand Medicaid.
Avalere’s takeaway is that states that operate their own exchanges are generally failing to connect uninsured residents with coverage at the levels they had anticipated.
“State-run exchanges lost more ground with enrollment in 2015, making it even harder to achieve annual goals for enrollment growth,” said Elizabeth Carpenter, director at Avalere.
State retention and growth performance varied among the largest individual states based upon whether they ran their own exchanges or availed themselves of the federal mode, Avalere found.
“Large federally facilitated states like Florida and Texas increased enrollment by 62 percent and 64 percent respectively. Conversely, large enrollment state-run exchanges like California and New York increased enrollment by 1 percent and 10 percent respectively,” Avalere reported.
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Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
