As the calendar turns to 2014 and the Affordable Care Act (aka, Obamacare) continues moving its way through implementation, now is a good time to provide an update on the much-maligned state health exchange rollout and Medicaid expansion enrollment data to get an idea of how many newly insured Americans could potentially enter the healthcare marketplace in 2014.
Open enrollment for consumers to view and purchase a private insurance plan from a state health exchange or the federal exchange began on October 1, 2013. While many of the individual state exchanges worked with little incident, the federal exchange, which operates in 36 states across the country, has received the bulk of the media attention for the severely botched rollout of the exchange web site. For weeks, millions of potential consumers were greeted with error messages when attempting to view and purchase a private health insurance plan in the first month of operation.
However, a recent release from the Obama Administration does show a considerable rebound from the roughly 100,000 enrollee’s in month of October. In total, just over 2.1 million Americans have now signed up for a private health insurance plan on the exchanges. 2.1 million is far short of the 7 million target for 2014 endorsed by the Obama Administration. The open enrollment period will continue until March 31, 2014 to obtain health insurance before enforcement of the individual mandate becomes active. The penalty for not obtaining health insurance in 2014 is $95 or 2.5% of annual income. The penalty for businesses not providing insurance to their employees has been delayed until 2015.
In addition to the health exchange enrollment increases, the Obamacare provision that has had the largest impact to date on covering more Americans is Medicaid. 25 states and the District of Columbia have chosen to expand their Medicaid enrollment criteria to 138% of the Federal Poverty Level. According to a recent release from CMS, more than 3.9 million Americans have now taken initial steps to enroll in Medicaid in October and November of 2013. (including both those that are newly eligible and those that were previously eligible but had not signed up)
The U.S. Supreme Court ruling in 2012 made the Medicaid expansion voluntary for states, prompting the Congressional Budget Office to reduce their projection of thirteen million to seven million who would qualify for expanded Medicaid in 2014. As a point of reference, prior to the ACA expansion of Medicaid, the state/federal partnership program covered 45 million, or 16% of the American population, including a majority of seniors living in long term care facilities.
While just half of states have chosen to expand their Medicaid programs to date, recent efforts in Arkansas and Iowa could be a harbinger of things to come in states that have thus far declined the expansion. Arkansas and Iowa’s plans will take advantage of 100% federal matching funds for three years for the Medicaid expansion, but will not add to their Medicaid rolls; rather, they will use the federal funds to allow consumers in their state subsidies to purchase private insurance on the health exchanges.
So, Medicaid and those with insurance is only going to grow in 2014 and beyond. As I’ve mentioned in previous posts, state Medicaid programs, whether expanding their enrollment criteria or not, will see strong increases in enrollment as the Affordable Care Act continues toward implementation. More Medicaid recipients means more opportunity for providers. However, it also means Medicaid programs will be looking for increased efficiencies. To date, states have looked mainly at reimbursement cuts and a shift to more managed care organizations that will manage payment of O&P claims and provider networks.
Have questions about the Affordable Care Act’s impact in your state? Contact OPGA Government Relations for the most up to date information.