New CMS reports highlight ACA exchange dropouts

screenshot of Healthcare.gov websit
As of March 15, 10.3 million of the 12.2 million who signed up for ACA exchange plans during 2017 open enrollment had paid their first month’s premium to keep their coverage active.

With two new reports concerning enrollment in Affordable Care Act exchange plans, the Trump administration made the case that the individual insurance markets aren’t all they’re cracked up to be. 

The Centers for Medicare & Medicaid Services’ first report (PDF) shows that as of March 15, 10.3 million of the 12.2 million who signed up for ACA exchange plans during 2017 open enrollment had paid their first month’s premium to keep their coverage active.

Though that means that 1.9 million dropped their coverage as of mid-March, the attrition rate is relatively consistent with years past. During the 2016 open enrollment period, 12.7 million people selected plans, and by the end of March, 11.1 million had effectuated their coverage. 

CMS said in Monday’s report that it will later adjust its numbers to include individuals who effectuated their coverage in March of this year.

CMS’ second report (PDF) delved into why people terminated their coverage, concluding that based on exit survey data, the main culprit is cost. People with high premiums and those who don’t receive financial assistance were both more likely to cancel coverage, and consumers listed lack of affordability as one of the most common reasons for not paying for the first month’s coverage.

Other factors, however, were also at play, including gaining access to employer-sponsored coverage or qualifying for Medicare.

Both reports, CMS said, “provide a better understanding of why consumers are leaving the exchanges.”

“Consumers are sending a clear message that cost and affordability are major factors in their decision to cancel or terminate coverage,” CMS Administrator Seema Verma said in the agency’s announcement. 

Health and Human Services Secretary Tom Price added: “Not surprisingly, as costs continue to go up, fewer Americans can afford to pay more and get less for healthcare."

CMS’ two new reports add more fuel to the debate over who or what is responsible for the individual exchanges’ troubles. Republicans, who are working on repealing and replacing the ACA, point to rising premiums and insurer exits as proof their effort is necessary, while Democrats say it’s the actions of the Trump administration and the GOP-controlled Congress that have thrown the marketplaces into chaos.

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