ACA exchange enrollment could decrease in 2017

The fourth year of open enrollment in the Affordable Care Act (ACA) insurance marketplaces could see a “significant slowdown” in how many people purchase coverage, according to an analysis from Standard and Poor’s (S&P).

Compared to the estimated 12.7 million people who will sign up on the marketplace this year, in 2017, S&P predicts between 11.7 million and 13.3 million people will purchase coverage in the open enrollment period. Effectuated enrollment, however, may fall as low as 10.2 million people because S&P assumed only 85 percent of customers would maintain their marketplace coverage throughout the entire year.

The forecast is less sunny than the estimate from the Congressional Budget Office of 15 million enrollees in 2017.

“We expect 2017 to be one step forward in increasing penetration to the subsidy-eligible uninsured and off-marketplace population, but one step back for the nonsubsidized marketplace population,” the analysis said. “The floor to our forecast is the subsidized marketplace enrollees, who remain somewhat hedged against the impact of premium increases.”

Premium increases and the departures of major insurers like UnitedHealth and Aetna from many exchanges have cast doubts on the long-term viability of the ACA marketplace. HHS and CMS, however, have countered that subsidies will shield many customers from the premium hikes and point to insurers that have made profits off exchange plans. A study from the Urban Institute said exchange premiums will still be lower than average rates for employer-sponsored plans.

The S&P analysis said it factored in several elements which could impact enrollment, including a high re-enrollment rate among people receiving subsidies and increased outreach to both the uninsured and off-marketplace customers who are eligible for assistance.

If those efforts don’t boost enrollment, the final figures could be lower. The analysis cautioned, however, that it doesn’t consider this to be “game over” for the exchanges.

“Pricing corrections by insurers are an unwelcome but somewhat needed side effect of the evolving insurance marketplace,” S&P said. “But there remains a floor to the marketplace population. The subsidized population will not feel the full brunt of the premium rate increases and will likely re-enroll each year. And although the sticker shock of the premium increases will slow overall growth rates in 2017, continued targeted outreach, regulators' attempts to improve marketplace rules as they affect insurers and moderation of premium rate increases beyond 2017 will likely bring growth back to the marketplace in future years.”