Abstract
Health insurance enrollment data show that the number of Americans with private health insurance coverage increased by a bit less than 2.5 million in the first half of 2014. While enrollment in individual market coverage grew by almost 6.3 million, 61 percent of that gain was offset by a reduction of nearly 3.8 million individuals with employer-sponsored coverage. During the same period, Medicaid enrollment increased by almost 6.1 million—principally as a result of Obamacare expanding eligibility to able-bodied, working-age adults. Consequently, 71 percent of the combined increase in health insurance coverage during the first half of 2014 was attributable to 25 states and the District of Columbia adopting the Obamacare Medicaid expansion.
With enrollment data now available for the second quarter of 2014, it is possible to construct a complete picture of the changes in health insurance coverage that occurred during the initial implementation of the Patient Protection and Affordable Care Act (PPACA), commonly known as Obamacare. The data show that in the first half of 2014, private health insurance enrollment increased by a net of 2,465,586 individuals. That net figure reflects the fact that 61 percent of the gain in individual coverage was offset by a drop in employer group coverage. During the same period, Medicaid enrollment grew by 6,072,651 individuals. Thus, while a total of 8.5 million individuals gained coverage, 71 percent of that net coverage gain was attributable to the Obamacare expansion of Medicaid to able-bodied, working-age adults.
Changes in Private Coverage Enrollment
Health insurers file quarterly reports with state regulators, and data from those reports for the second quarter of 2014 are now available.[1] The three relevant market subsets for this analysis are (1) the individual market, (2) the fully insured employer-group market, and the (3) self-insured employer-group market.[2] Table 1 shows the changes in private health insurance enrollment during the first and second quarters of 2014, along with the net changes for the combined six-month period.
Obamacare’s initial open enrollment period began on October 1, 2013, and officially ended on March 31, 2014—though in a number of states it was extended into April to give those who had experienced problems enrolling additional time to complete the process. Because enrollment was for the 2014 plan year, the coverage for those who enrolled during the fourth quarter of 2013 took effect in the new year; thus, those individuals are included in the data for the first quarter (Q1) of 2014. The data for Q2 2014 captures enrollments that occurred during the last two months of the open enrollment period, or which were otherwise delayed due to the numerous problems experienced by the exchanges, and so did not take effect until after the end of the first quarter.
The data show that enrollment in individual market coverage increased by over 2.7 million individuals in Q1 2014 and by a further 3.5 million individuals in Q2. Thus, for the first half of 2014, enrollment in individual market coverage grew by almost 6.3 million individuals.
The second-biggest coverage change that occurred during the first half of 2014 was the decline in the number of individuals with coverage through fully insured employer group plans. Enrollment in such plans dropped by 3.8 million individuals in Q1 2014, and by nearly a million more individuals in Q2 2014. Thus, for the first half of 2014, the number of individuals with coverage through a fully insured employer group plan decreased by nearly 4.8 million.
Enrollment in self-insured employer plans modestly increased in both quarters—by 347,000 in Q1 2014, and by about 652,000 in Q2—for a net enrollment gain of a little less than one million during the first half of 2014. Consequently, the combined enrollment changes in the two segments of the employer group market during the first half of 2014 produced a net decrease of almost 3.8 million in the number of Americans covered by employer-sponsored plans.
That net reduction in employer-sponsored group coverage is explained by employers discontinuing coverage for some or all of their workers or, in some cases, individuals losing access to such coverage due to employment changes. While it is not possible to determine from the data the subsequent coverage status of individuals who lost group coverage, there are only four possibilities: (1) some obtained replacement individual-market coverage (either on or off the exchanges); (2) some enrolled in Medicaid; (3) some enrolled in other coverage for which they are eligible (such as a plan offered by their new employer, a spouse’s plan, a parent’s policy, or Medicare); and (4) some became uninsured.
If individuals lost group coverage, but obtained new coverage under either another employer group plan or one in the individual market, they would then be counted in the enrollment figures for those submarkets. Similarly, if individuals transitioned to Medicaid, they would be counted in the Medicaid enrollment figures reported by the Centers for Medicare and Medicaid Services (CMS).
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