The Obama administration is making its final ACA enrollment push. Will it be enough?

Topics: Insurance, Exchanges, High-Risk Pools, Individual Mandate, Politics and Policy, Federal Government, Regulatory

By Heather Drost, senior editor

The Obama administration is holding nothing back in its last effort to encourage more consumers—particularly young adults—to enroll in exchange coverage when the 2017 open enrollment period launches Tuesday.  

Overall, federal officials estimate that 40 percent of the 10.7 million individuals who have remained uninsured fall into the 18- to 34-year-old age group. Those "young invincibles" have been the primary focus of every Affordable Care Act (ACA) enrollment push to date, and this year will be no different.

The administration has launched a series of initiatives to encourage young adults to enroll in coverage, such as:

  • Hosting a Millennial Outreach and Enrollment Summit where young leaders shared strategies to bolster enrollment among young adults;
  • Improving HealthCare.gov's mobile site to facilitate comparison shopping;
  • Launching the Healthy Campus Challenge in which college campuses sign up to host enrollment events and send reminder emails to students, with participating institutions entered into a lottery to attend a Healthy Campus Day event at the White House;
  • Promoting the hashtag "#HealthyAdulting" to spread messages about health through online platforms such as Facebook, Tumblr, Twitter, and Snapchat; and
  • Partnering with the video platform Twitch to display information about the ACA.

But while many health care experts agree that boosting young adult enrollment is key to strengthening the exchanges, they are doubtful that another marketing campaign will be enough to turn the tide.

"I don't think marketing is going to change the decision that people have made so far," Christ Holtz, director of health policy at the American Action Forum, told American Health Line. "If you really want to bring in more young adults, you are going to need to change the product that you're selling in some degree."

Current state of the exchanges

Holtz explained that in 2013, the administration estimated that young adults would need to make up about 40 percent of exchange enrollment in order to stabilize the risk pool and offset the costs of older, sicker enrollees. However, the actual percentage of young adults in the exchanges has consistently been about 28 percent.

"I think the insurers priced having a healthier risk pool than they have had, which has led to some of the price spikes and also insurers dropping out," Holtz said.

Those outcomes were further highlighted this week in HHS' report detailing exchange premiums and insurer participation for the 2017 coverage year. Premium increases for 2017 vary drastically across the country from a 116 percent increase in Arizona to a 3 percent decline in Indiana, and the percentage of consumers who will have just one insurer to choose from jumped from 2 percent in 2016 to 21 percent in 2017.

Stabilizing the exchanges

Politics aside, there is general agreement among actuaries on the changes needed to encourage young adults to enroll.

During a Twitter chat hosted this week by the Robert Wood Johnson Foundation and Milliman, several actuaries proposed adjusting age bands, changing covered benefits, increasing premium and cost-sharing subsidies, and strengthening penalties for remaining uninsured.

For instance, Stacey Muller, a principal and consulting actuary at Milliman, said, "Changes to age rating limits, mandate penalties, or premium subsidies are likely to be the most direct" way to encourage young adults to enroll.

Another Milliman principal and actuary, Jim O'Connor, said, "Opportunities to adjust plan design on preventive benefits may offer young adults more incentives."

Steve Sisko, a health care data technology and services consultant, proposed allowing young adults who age out of their parents' plans mid-year "to carry over deductibles." However, others have proposed removing that popular ACA provision altogether, forcing young adults to enter the individual market before age 26.

Holtz suggested that the federal government loosen the definition of essential health benefits to provide more flexibility in plan offerings. He also said aligning the age band ratings with current market trends could have a significant effect. Currently, insurers can charge older individuals in the ACA market three times as much as younger, healthier enrollees, but Holtz said the actual cost of insuring those older enrollees is roughly five times as much as that of insuring younger individuals.

Looking ahead

As the HHS report indicates, the table is essentially set for the 2017 coverage year. While the administration cannot alter essential health benefits for 2017 or change the way it incentives young adults to enroll, it is using these next few months to highlight the cost-sharing subsidies available on the exchanges to entice the uninsured, and those with plans purchased elsewhere, to buy exchange coverage.   

Any significant changes the Obama administration might consider to benefit plans or enrollment periods will be geared toward 2018.

Holtz said he has seen "some willingness" among lawmakers to consider age band adjustments, but much will depend on the makeup of Congress and the outcome of the presidential election next month.