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10 million people expected to have Marketplace coverage at end of 2016

HHS aims to sign up more than 1 out of every 4 uninsured consumers eligible for coverage

U.S. Health and Human Services (HHS) Secretary Sylvia M. Burwell announced today that she expects 10 million individuals to be enrolled in coverage through the Health Insurance Marketplaces and paying their premiums – so-called effectuated coverage – at the close of 2016.  As part of that goal, HHS believes more than 1 out of every 4 uninsured Marketplace-eligible consumers will select plans during Open Enrollment.

Today, the HHS Office of the Assistant Secretary for Planning and Evaluation (ASPE) released a demographic analysis of the uninsured individuals who are likely eligible for Marketplace coverage, along with its methodology for estimating the number of individuals it expects to have effectuated Marketplace coverage at the end of 2016.  According to the reports, nearly 8 in 10 of the approximately 10.5 million uninsured individuals likely to be eligible for qualified health plans (or the “QHP-eligible uninsured”) may be eligible for financial help through the Marketplaces.

“We believe 10 million is a strong and realistic goal,” Burwell said. “We’ve seen high levels of satisfaction with the Marketplace and expect the vast majority of our current customers will reenroll. And our target assumes that more than one out of every four of the eligible uninsured will select plans. We are working hard to improve the customer experience with upgrades to our site and more tools to help people find what they are looking for. We want to make it easier for consumers to find the right plan at the right price.”

ASPE developed a range of estimates for the number of individuals who are expected to have Marketplace coverage at the end of 2016 from three sources: 1) individuals who have Marketplace coverage in 2015 and are expected to reenroll in 2016, 2) the QHP-eligible uninsured, and 3) individuals who bought 2015 coverage on the individual market outside the Marketplace and may switch to Marketplace coverage. Importantly, early independent projections for Marketplace sign-ups envisioned a significant migration from employer-sponsored coverage. That shift has not occurred.

Using the 2015 year-end effectuated enrollment projection of 9.1 million individuals as a starting point, and accounting for normal fluctuation in the market, ASPE estimates that 7.3 million to 8.8 million individuals who had Marketplace coverage in 2015 will select plans or automatically reenroll in 2016.  Next, ASPE expects about 2.8 million to 3.9 million of the roughly 10.5 million QHP-eligible uninsured will select plans during Open Enrollment. ASPE also expects 900,000 to 1.5 million individuals who are currently insured on the individual market outside the Marketplace will select a Marketplace plan in 2016.  Combining these projections, ASPE estimated a range of 11.0 to 14.1 million total Marketplace plan selections during the third Open Enrollment period.

Today’s estimates are based on HHS’s experience during the second Open Enrollment period, state-level take-up rates among individuals who would be new to the Marketplaces in 2016, and account for large reductions in the uninsured to date.

As is the case with any well-functioning market, HHS expects to see customers come and go as their life circumstances change; for example, they will drop Marketplace coverage if they become eligible for employer plans, Medicare or Medicaid, or they will sign up after Open Enrollment closes if they get married, have a baby, or move out of state.  Based on these changes and past experience, ASPE estimates a final range of 9.4 million to 11.4 million individuals with effectuated coverage at the end of 2016. HHS will manage to a goal of 10 million people with effectuated enrollment at the end of 2016.

ASPE also released a brief today that provides additional insight into the approximately 10.5 million QHP-eligible uninsured:

• Almost half are between the ages of 18 and 34.
• Almost 40 percent are living between 139 and 250 percent of the poverty level (approximately $30,000 – $60,000 for a family of four). Almost 8 in 10 have an income that may qualify them for financial assistance.
• More than a third are people of color: about 19 percent are Hispanic, 14 percent are African-American, and 2 percent are Asian. There are also more men than women; around 57 percent are male.

Finally, survey data show that the uninsured have concerns about whether they can afford coverage. Nearly 8 in 10 people without insurance have less than $1,000 in savings, and about half have less than $100 in savings. Almost 60 percent are either confused about how the premium tax credits work or don’t know that they are available.  In 2015, roughly 85 percent of Marketplace consumers received an average tax credit of around $270 per month.

To read the ASPE brief on the number of individuals who might have effectuated Marketplace coverage at the end of 2016 visit: http://aspe.hhs.gov/pdf-report/how-many-individuals-might-have-marketplace-coverage-at-the-end-of-2016

To read the ASPE brief on the QHP-eligible uninsured visit: http://aspe.hhs.gov/pdf-report/health-insurance-marketplace-uninsured-populations-eligible-enroll-2016

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