ACA enrollment declines greatest among non-subsidized plans

A newly released report from the Centers for Medicare and Medicaid indicates that premium hikes by insurers for coverage under the Affordable Care Act made policies unaffordable for about a million people. But despite that fact, more people actually paid premiums for coverage than last year.

As reported by the New York Times, the Centers for Medicare and Medicaid’s analysis on trends in subsidized and unsubsidized insurance found that about a million Americans dropped coverage, apparently thanks to the 20-percent-plus premium hikes—and they likely fall into the group of workers who make too much money to qualify for premium subsidies: those whose incomes are a little above the $48,000 poverty line. This group saw a 20 percent decline in enrollment, compared to just 3 percent among subsidized enrollees.

Related: What factors drove Obamacare signups in 2018?

“These reports show that the high-price plans on the individual market are unaffordable and forcing unsubsidized middle-class consumers to drop coverage,” CMS administrator Seema Verma said in a statement.

According to the Times, “The [CMS] report does not provide enough information to be sure precisely how much of the difference is a result of increased prices. For complicated reasons, some people who paid full price in 2016 became eligible for subsidies in 2017, making a simple comparison of before and after numbers a little misleading.”

From 2016 to 2017, 44 states saw declining enrollment, with  Arizona, Louisiana and Minnesota each losing more than a third of their enrollment, according to the CMS report. Again, non-subsidized enrollees made up the bulk of the loss at the state level, accounting for 40 percent of the decline.

Still, while premium hikes and government action are seemingly driving people away from the ACA marketplace, the ACA is still gaining ground. Though open-enrollment signups declined this year, more people actually followed through on paying their first month of premiums and actually activated their insurance. According to an article from the Washington Post, approximately 10.6 million people bought coverage and paid premiums, a 3 percent increase.

There are other factors that could account for the changes, the Times points out, including Trump administration actions that included slashed advertising budgets for the signup period, additional obstacles to signing up later in the year and the abandonment of payments to insurers to help offset the cost of the lowest-income customers. In addition, there’s the potential for some people to have dropped ACA coverage after finding a job that offers health benefits.

But it is likely that the hefty premium increases are responsible for the bulk of the drop in coverage—particularly since the latest data indicate that about 87 percent of people with ACA coverage are subsidized, a notable increase over earlier years. According to the CMS report, since 2014, the gap between subsidized ACA enrollees and non-subsidized has increased from 23 percent to 61 percent in 2017.

The Trump administration has used the price increases to push for the addition of health plans that cost less because they cover less and do not provide the 10 essential elements and protections required under the ACA.