Effectuated Enrollment vs. The Final Tally for 2017 – a 20 Percent Drop in Customers


December 14, 2017

On Wednesday, December 13, the Centers for Medicare and Medicaid Services (CMS) released a report outlining effectuated enrollment for the first half of 2017, which is the number of people who not only signed up for a health plan during the 2017 enrollment period but who kept the plan by paying their premiums. According to the data, an average of 10.1 million people effectuated coverage from January through June 2017.

In its final report on enrollment in March 2017, the CMS noted that 12.2 million people chose a health plan during the fourth annual signup period, which ran from November 1, 2016 through January 31, 2017. The latest tally of effectuated enrollment – again, the number of people who kept a plan by paying their premiums – indicates that over 2 million people dropped their coverage by the end of the first half of 2017. These numbers fall in line with data from previous enrollment cycles. The CMS found that since 2014, an average of about a million people drop their coverage before the end of each plan year. Both reports take into account data from federal- and state-based marketplaces.

People who qualify for cost assistance on the marketplace are more likely to keep their coverage. On average in 2017, about 84 percent of exchange customers nationwide qualified for advance premium tax credits to reduce the cost of monthly premiums. Tax credits vary by enrollee, but the average dollar amount of a subsidy during the first half of last year was $373.37 a month.

Depending on where you live, your subsidy could be substantially higher. Alaska – where 92 percent of enrollees qualify for tax credits – tops the list with an average monthly premium tax credit of $965.53. North Carolina has the highest rate of exchange customers who qualify for tax credits at 94 percent. Here, tax credits are worth an average of $593.70 a month. In Washington, D.C., just 5 percent of exchange customers qualify for tax credits, which are worth $252.70 a month in the country’s capital.

Approximately 57 percent of exchange customers throughout the country qualified for additional cost assistance in the form of cost-sharing reductions (CSRs), which lower out-of-pocket costs for people earning between 100 and 250 percent of the federal poverty level and who choose a silver plan on the marketplace.

One of the Trump administration’s more controversial moves this year was to cut off cost-sharing reduction payments to insurers. Under the Affordable Care Act, insurance companies must lower cost-sharing amounts to customers who qualify based on income guidelines. Until this year, insurers were reimbursed for this loss by the federal government.

But a federal district court ruled last year, after being sued by the House of Representatives, that these CSR payments violated the Constitution – since they weren’t adequately appropriated in the ACA – and the Trump administration decided to uphold that ruling by halting federal payments this year. In return, insurers increased premiums for 2018 to recoup expected losses when they must by law lower out-of-pocket costs for lower-income customers.

As the fifth enrollment season winds down, signups have slowed. Initially reported as one of the most successful enrollment kickoffs in Obamacare’s brief history, it appears that the actual pace of enrollments is far behind what it needs to be to compete with previous years. And given that enrollment ends nationwide on Friday, it’s unlikely that even a sudden surge would help the final tally. Those still looking for a major medical plan for 2018 have until December 15 in most states to sign up.