CMS: Obamacare enrollment drops to 10.3 million

The Center for Medicare and Medicaid Services says Obamacare enrollment has dropped to 10.3 million, down significantly from the 12.2 million announced in March. The drop represents the number of people who signed up for an insurance plan during the open enrollment period but never paid the premium necessary to make it effective.

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As of March 15, 2017, 10.3 million individuals had effectuated their coverage for February 2017, meaning that they selected a plan that started in January or February, and had paid their first month’s premium. It is important to note that this number is significantly lower than the 12.2 million (-1.9 million) individuals, as reported in the March Open Enrollment Report. Therefore, in order to get a complete picture about enrollment numbers, it is more accurate to highlight the number of people who actually paid their premiums than those who simply selected a plan. This number will be adjusted for individuals who effectuate their coverage in March 2017.

It’s a steep drop off, but over at ACA signups, Charles Gaba argues the tally leaves out some people out who signed up for insurance in the last two weeks of open enrollment. Notice that CMS says this snapshot refers to people whose plans were effectuated “in January or February.” Why does that matter? Because most people who bought insurance during the final two weeks of open enrollment (1/16/17-1/31/17) have plans that take effect on March 1st. And that’s a lot of people, nearly half a million. So if this snapshot had included March 1st the total number of effectuated plans would probably jump up to around 10.7 million. We’ll have to wait for a future snapshot to see how accurate that estimate is.

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Gaba also makes the point that the percentage of people dropping their insurance seems to be just under 12%, which is slightly better than previous years. One could argue that’s a sign of improvement but I think the counter-argument, in this case, is that enrollment was already a couple hundred thousand below last year. So it’s possible the percentage of dropouts is lower because many of the people who were unsure about coverage didn’t enroll in the first place.

CMS also highlights the fact that people continue to drop out of their plans throughout the year:

Looking historically at the Patient Protection and Affordable Care Act trends from 2014 through 2017, we also see that a significant number of people who effectuate coverage, do not stay in their plans for the full year. In March of 2016, 10.8 million people had effectuated coverage through the Exchanges, and by the end of the year, only 9.1 million remained. The data on drops in effectuated enrollment shows that, on average since 2014, more than a million enrollees per year have dropped their coverage before the end of the plan year. It is also significant to note that the 10.3 million number reported today falls below the HHS projections for annual 2017 effectuated enrollment.

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There’s no telling if 2017 will follow the pattern of 2016, but open enrollment was behind last year and, even if you include those effectuated on March 1st, the number of effectuated plans is also behind last year. So if enrollment this year does continue to follow the pattern it did last year then we would probably expect a final tally of just below 9 million people enrolled by the end of the year.

The real question, of course, is what happens next year assuming Obamacare is still with us. Will enrollment continue to shrink as insurers drop out and premiums go up? And if Republicans don’t repeal it this year, will that automatically become their problem next year?

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