For health exchanges, stability has swung around the markets like a pendulum.
At first, drastic problems with Healthcare.gov affirmed the decision of a few states to run their own marketplaces. Then technology issues faded, and Healthcare.gov operated smoothly for several years. Several states dropped their own exchanges to piggyback on the federal platform (Nevada and Oregon), while political changes led others to move to Healthcare.gov (Kentucky).
During 2018 open enrollment, stability falls squarely with state-run exchanges again. Some impacts will be felt everywhere. The end of cost-sharing reduction payments will hit all exchange insurers (while potentially increasing tax credits for eligible enrollees). All exchanges will feel the pinch of higher premiums with the loss of CSRs.
Tax credits will continue to flow and could blunt premium increases for some enrollees. People outside the tax credit range, $48,240 or less for a single person and $98,400 or less for a family of four, are up a creek without a paddle or a canoe. That remains one of Obamacare’s glaring flaws.
While only a few states still run their own marketplaces, mostly deep-blue states and a few outliers (Idaho), they have latitude unavailable to states that ceded control to Healthcare.gov.
The bigger impact for state-run exchanges is outreach and promotion. The new administration at the U.S. Department of Health and Human Services cut the budget for outreach and promotion by 90 percent to $10 million for 2018, while also planning Healthcare.gov downtime on five of six Sundays during open enrollment.
We have some inkling how this might play out. At the end of 2017 open enrollment and the beginning of the Trump administration, Health and Human Services cut its last-minute marketing blitz, and federal exchange enrollment sagged. But exchange enrollment did not drop everywhere, several state-run exchanges, including Colorado and Idaho, exceeded their 2016 enrollment.
The state-run platforms are also not beholden to federal enrollment deadlines. Several state exchanges have extended open enrollment beyond the federal exchange’s Dec. 15 deadline. MNSure allows consumers an extra month (Jan. 15) and New York State of Health consumers can enroll until Jan. 31. Consumers remain oblivious to the new 45-day open-enrollment window.
There is an undeniable knowledge gap about enrollment, which the last-minute marketing pushes have filled in past years. An October 2017 Kaiser Family Foundation tracking poll found that three-fourths of marketplace enrollees didn’t know when 2018 open enrollment ended or had an incorrect date. If exchange consumers are largely oblivious of enrollment’s end, the outreach won’t be there in most states.
In Healthcare.gov states, outreach must come from the insurers themselves. Expect many to follow the example of Horizon Blue Cross Blue Shield of New Jersey, the state’s largest carrier and its biggest exchange carrier. To combat the loss of outreach dollars, Horizon plans a bigger marketing campaign and will open temporary brick-and-mortar sites in New Jersey malls ranging from kiosks to full-blown enrollment centers.
Even if insurers throw more weight toward open enrollment promotion, enrollment decline in 2018 is almost guaranteed. Some states have exchanges in pitiful shape (Iowa), and lack of choice could lead some consumers to pay the penalty or seek a hardship exemption rather than acquire coverage.
But don’t be surprised if those symptoms don’t afflict most state-run exchanges.
Follow Bill Melville @BillMelvilleDRG
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