US insurers see jump in sign-Ups for Affordable Care Act

Dow Jones – Heading into the second week of the Affordable Care Act’s annual open-enrolment period, early sign-ups and traffic appear strong, according to industry and government officials, with more than 600,000 people selecting plans through the federal HealthCare.gov website in the initial days.

ACA insurers including Highmark Health, CareSource, Independence Blue Cross and Sanford Health Plan said they were so far seeing significantly increased sign-ups compared with last year’s enrolment period.

But companies cautioned that it wasn’t clear that the early surge would be borne out in the final enrolment numbers, which likely won’t be known until next year.

Insurers suggested the early influx was partly sparked by the spotlight on the ACA amid Republican efforts to repeal or change it.

“You couldn’t have paid for that kind of advertising,” said Steve Ringel, president of the Ohio market for CareSource, which sells ACA plans in four states. “It doesn’t matter what the story line is, it’s drawing attention to the marketplace.”

In the first four days of ACA open enrolment, which started November 1, 601,462 people selected insurance plans for next year using the federal marketplace, HealthCare.gov, according to the Trump administration.

Of those, 137,322 counted as new customers, because they won’t be in an ACA plan at the end of 2017. The federal insurance exchange is used by 39 states.

Trump administration officials said the equivalent numbers for the first four days of last year’s enrolment period were not available. One administration official said it was “too early to form any kind of conclusion regarding comparisons” with last year. In the first 12 days of last year’s open enrolment, 1,008,218 people selected plans, with 246,433 new consumers, the Obama administration reported at the time.

State ACA exchanges in Washington, Idaho and New York, which are separate from HealthCare.gov, reported significant increases in traffic on their sites compared with last year. In California, sign-ups on the first day were “substantially higher than we’ve ever had before,” said Peter V. Lee, executive director of Covered California, the state’s ACA exchange.

But, he said, “the real numbers that matter” come later. Healthier consumers, who are important to the stability of the insurance market, often wait to enrol.

Shorter enrolment period

Early ACA consumer volume may also partly reflect the shorter open-enrolment period this year compared with prior years, said Alexis Miller, a Highmark senior vice president. Insurers have been pressing hard to get consumers to shop early. In most states, enrolment will end on December 15.

“In most years, you have a peak early, then a lull, and then a peak at the end,” said Geoff Bartsh, a vice president at Medica, which sells ACA plans in states including Iowa and Nebraska. He said sign-ups were “right on track or slightly ahead of our expectations.”

Some insurers remain worried that overall ACA-plan enrolment for 2018 will ultimately drop, partly because of steep premium increases in many places. This year the increases are being implemented in a way that creates a bifurcated market, due to the details of the law and a recent Trump administration action.

Those who don’t get federal premium subsidies—available to a person making up to around $48,000—may feel the full brunt of rate increases. “They may choose not to enrol because the plans have become too expensive,” said Rick Notter, an executive at Blue Cross Blue Shield of Michigan. Insurers often won’t know if people are dropping out of the ACA coverage until next year, since the consumers may be automatically re-enrolled but then decline to pay their first 2018 premium.

So far in the open-enrolment period, the Michigan insurer is seeing a sharp overall increase in new customers, Notter said.

Lower incomes

On the other side, many people with lower incomes, who are eligible for subsidies, can find a growing array of plans for which they will pay little or nothing in premiums.

The “free” plans look like “a real driver for consumers,” said Brian Lobley, an executive at Independence Blue Cross. People often initially react with surprise, he said: “‘What do you mean, zero premium? What’s the catch?’”

Major insurance agency HealthMarkets is seeing sign-ups for ACA coverage running more than 50% higher than they were at the same point last year, driven by “gangbusters” activity among subsidised consumers.

“It’s a very different market if you’re subsidy-eligible versus not subsidy-eligible,” said Michael Z. Stahl, a senior vice president. Many of those who don’t get subsidies want to look at skinnier, cheaper alternatives to ACA coverage, he said.

At Blue Cross Blue Shield of Wyoming, which increased its rates by 48% on average for next year’s plans, consumers who don’t get subsidies are expressing “anger and frustration,” said Wendy Curran, a spokeswoman. But, she said, many of those who are eligible for subsidies are “surprised and amazed” at the low cost of insurance.