While President Donald Trump cut the 2021 Obamacare open enrollment period (OEP) in half, President Joe Biden has hastily doubled up and overlapped successive enrollment periods, despite stagnating ACA Marketplace enrollment rates.
Every year, the Patient Protection and Affordable Care Act (ACA) establishes an OEP for eligible individuals to select a qualified health plan (QHP) via both federal and state-based marketplace options. Enrollment dates typically span from November to mid-December, but consumers may sometimes qualify for a Special Enrollment Period (SEP) depending on certain life events. Qualifications for SEP enrollment normally include termination of health coverage due to job loss, moving, getting married, or having a baby. Yet, since the COVID-19 Pandemic, the Biden Administration signed an executive order which included an SEP that was set to run from February 15, 2021, and end May 15, 2021, for all Americans regardless of the unique life events that would otherwise apply.
Obamacare is always a contentious health care topic across the aisle because of disagreements over the act’s fiscal efficiency and general effectiveness at covering the uninsured. The reflexive outcry from conservative lawmakers that “coverage does not equal care” is no novel criticism of the ACA.
The negative attention garnered by this SEP, however, comes from its suspiciously long enrollment period with nothing outstanding to show for it. In mid-March, when SEP enrollment rates were reported at less than a quarter million, the Centers for Medicare and Medicaid Services (CMS) announced that the enrollment period would extend into mid-August. Enrollment began to crawl from 528,000 in March, to 940,000 in April and now sits at 1.52 million as of June. For reference, SEP rates in 2015 clocked in at 1.2 million, without CMS banking on the hysteria of a public health crisis and unemployment. So, where are the droves of hopeful enrollees who are still suffering in the aftermath of the pandemic?
Figure 1. Enrollees by Total, OEP, & SEP from 2014-2021
Figure 1 illustrates open and special enrollment periods as well as the cumulative enrollment volume per year from the ACA’s inception through the present. OEP data for each year includes enrollment rates collected through the official deadline usually around late December or January. SEP data represents all enrollment periods for that year outside of the regular OEP.
The SEP in 2020 was designed as a response to the pandemic, but, relative to the preceding years, the overall change in total enrollment volume does not reflect the drastic public health and financial impacts of that year. Nor does this year. Contrary to the self-congratulatory pro-ACA headlines, the OEP and SEP enrollment rates of 2021 are relatively unremarkable. The 2021 SEP is not over but its unexceptional enrollment rate thus far has seriously undermined the necessity for an extension into August.
Figure 2. ESI Coverage Among Individuals Under 65
Additionally, apprehension over job loss and, therefore, loss of employer sponsored insurance (ESI) was naturally higher in 2020 when the effects of the pandemic were in full swing. This likely explains the significant increase in SEP enrollment from 2019 to 2020, but the same conclusion cannot be drawn for 2021. At its peak in April 2020, unemployment hovered around 14.8 percent, and although more than 3 million adults lost their ESI coverage, the majority of workers in the industries that were hit hardest financially by the pandemic did not have job-based coverage to begin with. The dip downward, a projection for 2021, can be explained by employer’s reluctance to compete with the subsidies offered by the marketplace—not as a function of a damaged economy or limited job prospects. This year, unemployment is down to 6.0 percent and steadily declining. Fear of losing health insurance because of the pandemic has largely dissipated.
Figure 3. New vs Returning ACA Enrollees During Annual OEP
The number of new annual enrollees as well as re-enrollees provides insight on the relative strength of marketplace maintenance. The number of new ACA Marketplace enrollees is evidently on the decline. Further, observing the change in reenrollment from year to year, the less-than-a-million increase in returning enrollees between 2020 and 2021 during a pandemic is also nothing to write home about, considering the number of people made eligible to sign up. The change in returning individuals in years prior to the public health crisis are disappointingly modest at best.
Figure 3 uses federal navigator funding (FNF) to assess how the government financially prioritizes outreach and education to increase enrollment rates. In other words, implementing this metric highlights the relationship between federal assistance funding and enrollment rates. The decrease in navigator funding during the Trump administration bears little impact, if any, on overall enrollment rates. FNF does not even factor in this year’s deluxe emergency advertising initiative.
The Biden Administration announced that it has invested $100 million in a new ad campaign to raise awareness for the 2021 emergency SEP. The $100 million in marketing funds is being spent on ads for television, radio and 30 second YouTube videos like this (production cost unknown). This is the only time a SEP has received federal advertisement funding. Previous OEPs have certainly had their fair share of government-sponsored marketing (ranging from 10 to 100 million dollars per EP) but those campaigns ran ads during the time of year that primarily targeted OEP enrollees. The dollar amount of FNF spent on reaching SEP enrollees is represented by the product of total FNF spent in a given year and the proportion of SEP enrollees who signed up in that year. Between 2014 and 2020, the cost of each unique SEP enrollee based on FNF fluctuated between $2.68 to $12.74 per person. This eye-catching range is immediately dwarfed by the $68.15 cost per enrollee of this emergency SEP when one factors in the supplementary SEP ad campaign that is running from February through August. The only way to justify this roughly ten-fold increase in total spending would be if approximately 12 million, not just 1.2 million, new individuals signed up for ACA Marketplace coverage during this emergency SEP—an unlikely outcome. The Biden Administration’s SEP outreach budget relative to its participating audience is glaringly disproportionate.
Furthermore, if the apparent scramble for enrollees is not already evident, the administration has also increased navigator funding to $80 million for 2022 enrollment. The investment in the program, designed to help consumers choose a plan, represents an eight-fold increase in funding relative to the Trump administration, which had slashed investment to $10 million annually. Despite Trump’s funding cuts to ACA marketing and outreach programs between 2017 and 2020, trying to prove that federal outreach funding helps enrollment rates is an uphill battle.
It would be a mistake to assume that the same degree of worry and uncertainty among enrollees are at play in this year’s SEP. Extending the enrollment period into August and spending a combined $110 million into marketing and outreach midway through demonstrates both a frenzied approach and a lack of confidence on the part of CMS in attempting to enroll as many people as possible.
CMS boasts that four in five consumers currently enrolled in a QHP would only pay a $10 per month premium and, after advance payments of the premium tax credits, an average of three in five Americans will pay no premium at all. These enticing subsidy plans make it hard to understand why 15 million Americans are eligible for marketplace enrollment but choose not to enroll. CMS has every imaginable resource at its disposal— advertising, navigators, and time. Extending the already generous enrollment period for the 15 million eligible but uninsured individuals is an irrational solution to boost ACA Marketplace enrollment.