Sharp Declines in ACA Enrollment Post-Subsidy Expiration: State Impacts
States experienced notable decreases in Affordable Care Act (ACA) enrollment over the past year, with particularly sharp declines in Ohio and Oklahoma, where each state witnessed nearly one-third of their enrollees exiting the program. This trend follows the expiration of enhanced subsidies in January, as detailed in newly released federal data that provides enrollment insights across all 50 states.
The federal statistics indicate that by February, around 2.6 million fewer individuals were enrolled in ACA plans compared to February of the previous year. This data highlights shifts in enrollment numbers, including those who initially enrolled or were automatically reenrolled but did not maintain their coverage by paying premiums. Cynthia Cox, a vice president and director of the ACA program at the healthcare nonprofit KFF, emphasizes that this is the first state-level data offering a clear picture of the reduction in ACA marketplace enrollment.
Analysts have been closely monitoring these enrollment shifts since the additional premium tax credits expired, leading to increased insurance premiums. This has made some consumers reconsider or abandon their ACA plans. Growing insurance costs across ACA and other health programs coincide with affordability concerns prominently expressed by voters in the upcoming elections.
A recent report from the U.S. Department of Health and Human Services suggested that this enrollment decrease might also result from federal efforts to address fraudulent enrollments. However, many analysts attribute the decline largely to the cessation of federal subsidies and tightened immigrant eligibility for subsidized plans. According to Mike Rhoads, deputy commissioner of life and health at the Oklahoma Insurance Department, affordability remains a crucial factor influencing enrollment in his state.
Data analysis revealed Ohio and Oklahoma experienced over 32% declines in ACA enrollment, surpassing other states. Also noteworthy, a significant reduction exceeding 25% was observed in Arizona, South Carolina, Minnesota, Indiana, Michigan, Mississippi, Louisiana, and Missouri. In Florida, which relies heavily on ACA insurance due in part to not expanding Medicaid, there was a drop of approximately 443,000 enrollees, although it still maintains the largest marketplace enrollment with nearly 4 million covered residents.
The data does not specify if individuals who left ACA plans found alternative coverage, but Cox suggests many may now be uninsured as the marketplace often serves as a last-option coverage source. States that saw substantial enrollment increases following the introduction of enhanced subsidies during the COVID-19 pandemic also showed significant recent declines.
New Mexico is the sole state reporting an increase in ACA enrollment, growing by about 14% from the previous year. This growth is attributed to New Mexico's decision to fully offset the loss of federal subsidies with state funds. Across the U.S., states using the federal marketplace generally experienced greater enrollment losses than those with state-based exchanges. State-based exchanges, like New Mexico’s, implemented measures to alleviate residents' cost burdens when enhanced subsidies expired.
Tim Fowler from the New Mexico Health Care Authority highlighted the significance of state initiatives, such as the healthcare affordability fund, in driving enrollment growth by replacing federal subsidies, aligning with the state's commitment to protecting residents from medical debt through insurance coverage.