With the third Open Enrollment Period (OEP) having come to an end, things have gone very smoothly. As of Jan. 23, 2016, a total of 11.6 million Americans had either signed up for Affordable Care Act (ACA)-compliant health insurance plans or renewed their coverage. This OEP also marked an enrollment experience relatively free of problems.
The 2016 OEP is also notable for having attracted large numbers of, younger, healthier consumers. These millennials (18-34 years old) are favored by the large insurance carriers that comprise about half of all Obamacare policies. With fewer older, sicker enrollees, plan premiums are typically reduced for all members. The increases in younger, healthier consumers should also enable the healthcare law to succeed in years to come.
An upswing ends 2016 enrollment
With the OEP’s closing, the only way to still obtain coverage is through a Special Enrollment Period (SEP), offered by the government. Or, you may be offered a personal SEP if specific life changes, known as Qualifying Life Events (QLEs) (e.g. marriage, childbirth, loss of coverage), occur. Those without ACA-compliant coverage may face tax penalties (the individual mandate); the 2016 amounts are substantially higher last year’s, although hardship exemptions may be available. If found liable, consumers will have to pay the greater of:
- $695 per adult and $347.50 per child, for a maximum of $2,085 per family, compared to 2015’s $325 and $162.50
- 2.5 percent of your income above the tax filing threshold, compared to 2015’s 2 percent
While these penalties are a major financial burden, they have persuaded Americans to purchase health coverage. By the OEP’s 12th week (Jan. 17-26, 2016), the Centers for Medicare and Medicaid Services (CMS), the agency overseeing the ACA, calculated an estimated 8.9 million sign-ups in the 38 states utilizing the government’s HealthCare.gov platform. And with state-run exchanges (and the District of Columbia) included, the current tally of plan sign-ups and renewals increases to 11.6 million.
Some states (and the District of Columbia) with their own exchanges are offering enrollment extensions. For instance, both Covered California and The Maryland Health Connection have extended their deadlines until Feb. 6. While extensions were provided in past years, due to technical issues and other issues, the OEP saw few problems. In fact, the Obama administration reported that there will be no official SEP in 2016.
Millennials smoothing out the risk pool
Of these sign-ups, the CMS found that 2.1 million 18-34-year-old consumers – also known as Young Invincibles (YIs) — had purchased coverage by Dec. 15, 2015. For this time in 2015, 1.1 million in this age range had purchased coverage. This offers evidence that the ACA’s continued efforts to draw enough YIs to balance out the risk pool is succeeding. Insurance carriers feel that this age group is generally healthier than older members, thereby increasing profits and decreasing medical costs for the coming year.
But these lower costs and happier carriers are expected to make Obamacare financially stronger in years to come. “Having people of good health participating in the marketplaces will contribute to the long-term financial stability of those marketplaces,” stated White House Press Secretary Josh Earnest. “That’s why that was a focus of our efforts, and the early indications are that those efforts were successful.”