Healthcare.gov enrollment declines; plan affordability a factor

The Government Accountability Office (GAO) found that in 2018, 5 percent fewer people enrolled in healthcare.gov individual market health insurance plans available on the exchanges than in 2017, most attributable to plan affordability. The GAO noted that premiums increased more than expected in 2018, detracting from enrollment. Conversely, larger tax credits helped exchange enrollment. Additionally, the report found that HHS reduced its consumer outreach for the 2018 open enrollment period (GAO Report, GAO 18-565, July 24, 2018).

Background

The exchanges, established by the Patient Protection and Affordable Care Act (ACA) (P.L. 111-149) allow consumers to enroll during an annual open enrollment period. HHS, along with other agencies, conduct outreach for the open enrollment period to encourage enrollment. The GAO report examined both outreach and enrollment for the exchanges using healthcare.gov.

According to the report, about 8.7 million consumers enrolled in heathcare.gov plans during the open enrollment period for 2018 coverage, five percent less than the 9.2 million enrolled for 2017 coverage. This decline represents a trend from the 2016 plan year, when 9.6 million consumers enrolled in these plans. Moreover, in 2018, enrollees new to healthcare.gov coverage comprised a smaller proportion of total enrollees in 2018 compared to 2017.

Affordability

Plan affordability likely played a “major role” in 2018 exchange enrollment. For example, in 2018, premiums across all healthcare.gov plans increased by an average of 30 percent. The GAO stated that because of the premium increases, plans were less affordable as compared to 2017 for exchange consumers without advance premium tax credits. Most stakeholders interviewed chalked up lower enrollment to decreased affordability of plans.

Although premium affordability reportedly played a role in enrollment, interviews with shareholders revealed that other factors likely affected 2018 healthcare.gov exchange enrollment. Many reported that there was consumer confusion about the ACA and its status, including the possibility or repeal or replace. As a result, the confusion played a “major role” in detracting from 2018 healthcare.gov enrollment. Other shareholders, however, dismissed this viewpoint, pointing to other factors for the decline.

As for consumer outreach, the report revealed that HHS drastically reduced the amount it spent on paid advertising, a 90 percent reduction, compared with advertising spending for the 2017 open enrollment period. Notwithstanding, HHS declared its advertising campaign in 2018 success. The GAO found that HHS reduced navigator funding by 42 percent for the 2018 open enrollment period compared to 2017. According to HHS, this was the result in a shift in its priorities, specifically HHS using a narrower approach and with “problematic data.” This included some consumer application data HHS acknowledged was unreliable and some “navigator organization-reported goal data that were based on an unclear description of the goal, and which HHS and navigator organizations likely interpreted differently.”

No targets

HHS did not set numeric enrollment targets for open enrollment in 2018, as it had in the past. According to the report, the lack of these numeric targets hampered HHS’ ability to evaluate its performance related to the specific open enrollment period, which in turn made it more difficult for HHS to make informed decisions related to its resources.

The GAO recommended that the HHS ensure that the data it uses to determine navigator organization awards is accurate, and recommended that HHS set numeric enrollment targets. Additionally, the GAO recommended that the HHS assess other aspects of the consumer experience. HHS agreed with all but the recommendation to set numeric enrollment targets