The Department of Health and Human Services (HHS) recently announced that the uninsured rate has dropped to a record low of eight percent, primarily due to Medicaid expansion in States, as well as the ability to stay on Medicaid throughout the public health emergency (PHE). This brings renewed importance to making sure that current beneficiaries who may lose their Medicaid eligibility upon a re-determination can remain covered by some form of insurance and to making sure that communications about their options are clear.
When an individual loses their Medicaid coverage, a “Special Enrollment Period” is triggered through which the individual can purchase a subsidized individual market Exchange plan (provided the individual is not offered an affordable/minimum value plan from an employer). This means the individual can now shop for a plan outside of open enrollment. When redeterminations begin, the Commonwealth Fund estimates that nearly 80 million people will go through the redetermination process. HHS estimates that roughly 15 million people will lose their Medicaid coverage when these redeterminations take place.
This is one of the reasons why it was so important for Congress to make sure that the enhanced premium subsidies for Exchange plans are available for the 2023 plan year. The availability of these subsidies – which will now be available through the end of 2025 – will be critical to ensuring that the record-low eight percent uninsured rate holds steady, and premiums remain affordable. For instance, for plan year 2022, 22 percent of consumers shopping on Healthcare.gov selected plans with a $0 monthly premium after factoring in the increased subsidy amounts, and more than half of 2022 OEP consumers paid $50 or less for their Exchange plan due to the enhanced subsidies. Although premium rates for individual market plans have increased in most markets for the 2023 plan year, the newly extended enhanced subsidies will absorb these increases, which means that a large number of consumers – especially those consumers losing their Medicaid eligibility – will be able to enroll in a $0 Exchange plan or pay $50 or less for their health coverage.
GetInsured is working closely with our state clients to improve the rate of successful transitions from Medicaid to Exchange plans. Stay tuned as we continue to monitor any announcements about the end of the PHE, and all other issues impacting the Exchanges and the individual market.