Two Twenty Four

 /  April 7, 2014, 6:30 p.m.

Rand Paul

Anna StapletonAnd like that, the first open enrollment period in the history of the Affordable Care Act is over.

After six months of extraordinary efforts, scrambles, failures and triumphs, over seven million people have signed up for health insurance through the new Marketplaces. It will be some time before the dust settles and we arrive at a final tally on enrollments. Estimates and projections abound, but nobody yet knows exactly how many people will end up with coverage for 2014.

There is one number we know for sure: 224. That's how many days there are between the end of the first open enrollment period, and the start of the second.

This small slice of time provides an opportunity to look back with the purpose of preparing for what lies ahead. There were parts of this experiment that worked well and parts that didn't: Marketplaces that enrolled residents ably and Marketplaces that were hamstrung from the start; people who found affordable health insurance and people who were disappointed by the available options.

For policymakers in both federal and state government, the job now is to figure out exactly what the problems were, and how to improve for next year.

On the national level, proposals presented by two groups of US Senators differ radically in the degree to which they would change the current healthcare law. The Republican plan put forth by Senators Orrin Hatch (R-UT), Tom Coburn (R-OK), and Richard Burr (R-NC) claims to have the same basic goal as the ACA - to provide Americans with affordable health insurance – and employs many of the same basic elements heavily modified to fit within a more conservative ideological framework.

After a full repeal of the ACA, these Senators would reinstate rules allowing young adults under age twenty-six to stay on their parent's plan, and prohibiting insurers from imposing lifetime limits on coverage used. The tax credits offered to individuals purchasing insurance under the ACA also reappear, but would depend only on the individual's age and income rather than being linked to the cost of available plans. Where the ACA prevents insurers from determining prices based on an individual's medical history, the Republican proposal adds a caveat aimed at preventing individuals from only buying coverage when the are sick by allowing insurers to adjust prices for pre-existing conditions if the individual was previously uninsured. These new rules are designed to provide some of the most popular protections instituted under the ACA while removing many of the mandates and regulations which conservatives find most disagreeable.

By contrast, the ideas proposed by Senators Heidi Heitkamp (D-ND), Mary Landrieu (D-LA), Mark Begich (D-AK), Mark Warner (D-VA), Joe Manchin (D-WV) and Angus King (I-ME) would leave the ACA in place while seeking to address some of the most common complaints about the law. These adjustments include a new tier of “Copper” plans (added to the existing Bronze, Silver, Gold and Platinum levels) that would have lower premiums in exchange for higher deductibles, providing a less expensive option for those who could not afford the current plans. In the hopes of making the law more business-friendly (a goal of particular importance during this election year), the group is also calling for an increase in the number of full-time employees a business must have before being required to provide insurance, from the current limit of fifty up to one hundred, while expanding the availability of tax credits for small employers with up to fifty employees instead of just twenty-five. On the whole, this proposal aims to make it easier for individuals and companies to comply with the coverage mandates imposed under the ACA.

While the Senate debates policy changes at the national level, states are faced with a set of much more practical and immediate decisions regarding the continued implementation of one of the health law's central provisions: the health insurance Marketplaces through which consumers can purchase coverage.

For plan-year 2014 (the enrollment period that just ended), every state had the choice to either run their own Marketplace (a “state-based Marketplace” or SBM), or to use a Marketplace established by the US Department of Health and Human Services (the “federally-facilitated Marketplace” or FFM). Fifteen states and Washington, DC ran their own Marketplaces, giving them full responsibility for approving the insurance plans offered, conducting outreach and education efforts, and implementing the technological systems needed to determine eligibility and allow consumers to enroll. The degree to which each state was successful varied widely, leaving some states needing only minor improvements while others are forced to seriously overhaul their implementation strategies.

Two states facing major overhauls are Maryland and Oregon. Both started off as among the most ambitious SBMs, with full support from their governors and legislatures, but come October 1, both were almost completely nonfunctional, their ambition having outpaced their organizational and technical capacity. Now Oregon is considering reverting to use of the federal Marketplace website,, for the coming year, and Maryland has announced that it will jettison its custom-built system and purchase the technology used by Connecticut, which has been one of the most successful Marketplaces.

Amid the many cautionary tales coming out of the first year of enrollment, there are also signs that SBM states are, on the whole, outperforming FFM states. As of March 1, SBM states had enrolled an average of about 20 percent of eligible individuals, as compared to just 12 percent in FFM states. Of all states, Vermont’s state-based Marketplace achieved the highest percentage of enrollment at 54 percent, while Maine, at 21 percent, was the highest enrollment among FFM states. While it will take time to work out exactly what influenced the improved outcomes among SBMs, their ability to customize their approaches to the needs of their populations, access to additional federal funding, and the full deployment of state resources to support those efforts were all likely contributors.

The performance of the current SBM states has been closely watched by many of the thirty-five FFM states as they consider transitioning to their own state systems. Arkansas has already announced its intentions to become an SBM by 2016, and others are likely to follow in the years to come. Once they’ve chosen to become an SBM, states then face a series of decisions regarding how the Marketplace will be governed, financed, and managed, how to conduct outreach, and how to design and build the website itself. Each of the sixteen SBMs took a unique combination of approaches to these tasks, providing sixteen opportunities to observe and learn which systems worked and which did not.

In the years to come, the process of enrolling people in health coverage through the Marketplaces will only improve. As policy makers at all levels take these 224 days to reflect, analyze, and adjust, they can look forward to a time when the annual rhythm of open enrollment is so regular that it will barely warrant any notice at all. Policy debates at the federal level will continue, the technology behind the Marketplaces will be improved, and some states that have not yet established SBMs will look to do so. Yet through the completion of this first open enrollment period, the framework has been set, and the basic principles tested. For the first time, Americans have been able to use government-established Marketplaces to search for, select, and receive financial support to purchase private health insurance that meets minimum quality standards and protects against financial calamity. Seven months from now, they will be able to do it again.

Anna Stapleton


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