Over the last two years a number of states have elected to transition off of Healthcare.gov, the Federally Facilitated Marketplace (FFM), and have, instead, opted for state-based alternatives that allow significantly more flexibility. States that operate on the FFM are finding it not only increasingly cost prohibitive but also extraordinarily limiting in terms of state health innovation. Plus, controlling health insurance dollars allows states to redirect much needed cash out of federal hands and into state hands. 

The COVID-19 outbreak in the United States provides us a real-time example of why state control over health insurance enrollments can be critical to maintaining a healthy budget. We’re seeing record levels of unemployment right now—currently 36.5 million US workers who filed for unemployment since the pandemic began. Many of these people will be turning to health insurance exchanges set up under the Affordable Care Act (ACA) or Medicaid for health coverage.

HHS announced on May 14th that user fees will remain at three percent for the 2021 plan year, but states can expect that enrollment levels will likely continue to be heightened due to the pandemic, causing fee increases anyway, as illustrated below. There are millions of dollars being paid to the federal government that could be going back to states if they were operating their own exchanges. 

wdt_ID State 2020 Enrollment Estimated 2020 User Fees Prior to COVID-19 Projected Enrollment Increase due to COVID-19* Updated Estimated 2020 User Fees
1 Alabama 160,429 $39,908,318 18,000 $44,385,998
2 Georgia 463,910 $94,526,302 49,000 $104,510,542
3 Maine 62,031 $14,336,605 8,000 $16,185,565
4 New Hampshire 44,412 $8,457,821 20,000 $12,266,621
5 Tennessee 200,445 $46,254,688 16,000 $49,946,848
6 Texas 1,116,293 $213,792,435 108,000 $234,476,595
7 Virginia 269,474 $62,183,820 74,000 $79,260,060

If your state wants to learn more about how it can clawback these budget dollars, email hello@getinsured.com.

(State user fees are calculated by applying the 3 percent user fee to monthly premiums and paid by carriers to FFM on behalf of the state.)

*HMA Estimates of COVID Impact on Coverage public version for April 3 830 CT.