In this new Wakely report, we analyze the effects of both the House budget reconciliation bill and the expiration of enhanced premium tax credits (ePTCs). The report highlights that the individual market will look fundamentally different when the full effects of all proposed changes occur. Specifically, the combination of ePTC expiring and full enactment of H.R. 1 could reduce current enrollment by 47% to 57% or between 11.2 and 13.6 million individual market enrollees.
- This range includes both direct impacts on subsidized individuals due to net premium increases after premium tax credits as well as a loss of unsubsidized enrollment between 3.9% to 6.1% following large gross premium increases.
- Non-Medicaid Expansion states would see especially large enrollment losses with total reduction in enrollment ranging between 53% and 64%.
- We estimate the combined effects could increase market average premiums between 7.0% to 11.5% due to market attrition and morbidity increases, not accounting for incremental claims trend impacts.
- H.R. 1, itself, could reduce enrollment between 22% and 27% or between 5.2 and 6.4 million enrollees when layered on top of the expiration of ePTCs.
- Enrollment and premium impacts varied by state; the range of potential enrollment impacts were wider than the average range of 47% to 57% and market average premiums between 7.0% to 11.5%.
- The combination of ending passive enrollment and pre-enrollment verification is estimated to reduce enrollment between 1.5 million and 3.3 million. The wide range of enrollment losses is driven by uncertainty about the impact of pre-enrollment verification which will be highly dependent on how it will be defined and enforced by CMS and operationalized by State Based Marketplaces and Healthcare.gov. The pre-enrollment verification program alone is estimated to result in coverage losses of 720,000 to 2.2 million people.
This report was also written with Health Management Associates Managing Director Zach Sherman.
Register for July 10 Webinar
Join us to explore findings from the white paper and an in-depth discussion with experts from Wakely, HMA, and Leavitt Partners on the future of the individual market and the impacts of potential Congressional and regulatory changes to the ACA. Register here for “The Future of the ACA Individual Market: Policy Shifts and the House Reconciliation Bill.”
