The open enrollment period for consumers to buy health care policies on the federal exchanges for the coming year begins Wednesday, though with policy shifts out of D.C. there are changes ahead for companies and individuals.
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Despite multiple unsuccessful efforts to repeal and replace the Affordable Care Act (ACA), the exchanges are still up and running and most individuals are still required to purchase coverage.
As you browse insurance options for the coming year, here are some important things to note about the current enrollment period.
Shorter enrollment period
In most states, consumers only have 45 days to buy health coverage during the open enrollment period. It begins on Nov. 1 and runs through Dec. 15. This means people have less time to make decisions regarding plans than last year, when the enrollment period ran through Jan. 1.
This year’s deadline has been extended in eight states, including California, Colorado, Connecticut, Massachusetts, Minnesota, New York, Rhode Island and Washington.
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According to a forecast released Tuesday by S&P Global Ratings, exchange enrollment for 2018 is expected to be between 10.6 million and 11.4 million people. That is up to 13% lower than last year’s rate. While the ratings agency expects most people who are currently signed up to re-enroll, it does not expect a significant number of new enrollees to enter the marketplace, predicting that number will stay between 2.3 million and 2.7 million.
Slower enrollment growth is bad news for insurers and consumers. The risk pools will still contain lower levels of healthy, younger individuals, which will be costlier for companies and will translate into higher premium costs for consumers.
“On average, premiums, will not decline without a higher level of new enrollment or states using ACA waivers to create reinsurance or other market-support mechanisms,” S&P concluded.
Uncertainty in the health care marketplace has caused many insurers to hike premium costs for the coming year. The cost of the average benchmark plan is expected to be about 37% higher than last year, according to data released by the Department of Health and Human Services.
However, those individuals who qualify for subsidies likely won't have to pay more. The average advance premium tax credits will rise by about 45%, and 80% of enrollees have been a part of plans for which APTCs were paid, according to the government data. So individuals should be able to use this tax credit to keep prices down.
Short-term policy offerings
President Donald Trump issued an executive order in October aimed at expanded access to coverage and reducing related costs. Part of that executive order directed the administration to look into the expansion of shorter-term, transitional plans, known as short-term limited duration insurance (STLDI). While these plans were primarily intended for people between jobs under ObamaCare, under Trump’s order they can be used by people in counties with scarce exchange offerings and those who miss the open enrollment period.
These offerings could pop up outside of the marketplace and some insurers already have proposals in the works. During Aetna’s (AET) third-quarter earnings call on Tuesday, CEO Mark Bertolini said the company was looking into reviving its shorter-term plans and would be ready to implement them as soon as they had “the opportunity to act.”
These plans cost less than exchange policies, but also aren’t subject to most ObamaCare requirements.