Some have blamed the uptick on weak enforcement of the individual mandate, while the Trump administration warned about declining choices and rising premiums in the individual-insurance market.

July 10—Nearly 2 million Americans have lost or dropped insurance coverage so far in 2017, according to a new national poll.

Since the end of 2016, the uninsured rate increased by 0.8 percentage points to 11.7 percent of the population, according to a tracking poll by Gallup and Sharecare. It had previously reached a record low of 10.9 percent in the third and fourth quarters of 2016.

The poll consisted of 45,087 interviews with U.S. adults from April 1 to June 30. Even with the recent increase, the uninsured rate was still 6.3 percentage points lower than the peak rate of 18 percent in the third quarter of 2013.

“There has been a little bit of the loss of the progress from what we have seen from 2013 through 2015, but it’s not dramatic,” said Benjamin Sommers, MD, PhD, associate professor of Health Policy and Economics at the Harvard T. H. Chan School of Public Health.

The Affordable Care Act’s (ACA’s) insurance marketplaces opened and Medicaid expansion began in October 2013, while the individual mandate required most Americans to have coverage or pay a tax penalty starting in 2014.

The recent increase in the uninsured rate followed a mid-2016 stall of a decline spanning several years.

“This is consistent with the notion that the coverage gains under the ACA for the time being have hit a floor,” Sommers said in an interview. As to whether the findings are the beginning of an upward trend in the uninsured rate, Sommers said, “It’s too early to say.”

Why the Increase?

The reasons behind the recent uptick in the uninsured rate remain unclear.

“Most likely, this suggests that, in part, the uncertainty about what’s going to happen with the [ACA] is having some trickle-down effects, in particular when you look at what is happening with the coverage in the non-group market,” Sommers said.

Some have blamed the drop-off in 2017 individual-insurance enrollment on a lack of enthusiasm among the Trump administration for either promoting enrollment or enforcing the ACA’s individual mandate.

“The combination of higher premiums and the lack of enforcement of the individual mandate almost certainly has contributed a lot to that,” said Douglas Holtz-Eakin, president, American Action Forum. “It makes everything harder in terms of stabilizing those markets.”

Gallup found the biggest coverage declines this year occurred among those with individual-market coverage, followed by those with employer-sponsored insurance. The decrease among the latter group runs counter to employer surveys by Mercer, which found that the share of employers who say they are likely to terminate health plans within the next five years declined from 19 percent in 2012 to 14 percent in 2016 among smaller employers and from 7 percent to 2 percent among large employers.

“There was a drop in employers offering coverage to PTEs (employees working fewer than 30 hours/week) from 2015 to 2016,” Beth Umland, a partner and director of research for Mercer, said. “Some employers did the math and found that their low-paid part-time employers could do better on the exchange (qualifying for a subsidy or even Medicaid in the Medicaid expansion states) than in an employer plan, so they dropped the PTE plan.”

Additionally, fewer employers have offered retiree health plans due to the availability of marketplace plans.

Other analysts see spiking premiums and declining insurance plan options leading fewer to sign up for individual coverage.

“It’s hard to blame [the administration] too much for what’s going on in the underlying marketplace; they haven’t really done that much since they’ve been in there,” said James Capretta, resident fellow at the American Enterprise Institute. “The more probable explanation is a resettling about where the equilibrium is going to be under existing law based on the level of insurance premiums people are willing to pay.”

Some support for that view was seen in Gallup’s finding that the biggest insurance coverage decreases have occurred among the so-called young invincibles (ages 18 to 34), who are the most sensitive to premium increases.

That challenge could worsen in 2018 following the administration’s July 10 announcement of a 38 percent decrease in the number of insurers submitting plans to sell policies next year in the federally operated ACA marketplaces.

Tom Price, MD, secretary of the U.S. Department of Health and Human Services, said in a written statement that the decrease would further limit consumer choices of insurers and providers, and underscored the need for legislative action.

“Congress must act now to repair the damage Obamacare has inflicted and put in place a patient-centered system that is responsive to the needs of individuals and families, not the demands of Washington,” Price said.

Impact on the Policy Debate

It is unclear whether the latest jump in the uninsured rate will affect the ongoing debate over whether to repeal and replace parts of the ACA. The reported increase in the number of uninsured followed estimates by the nonpartisan Congressional Budget Office (CBO) that 22 to 23 million fewer Americans would have coverage under the House and Senate healthcare reform proposals.

“When you’re already being tagged and blamed for projecting to cause 20 million-plus people to lose coverage, no one notices 2 million,” said Thomas Miller, resident fellow at the American Enterprise Institute “That’s not consequential to the larger issue if you are buying in to the larger projection.”

The impact of the latest coverage totals on the debate over ACA repeal will likely depend on the upcoming CBO projections of the latest tweaks to the Senate’s Better Care Reconciliation Act (BCRA), said Holtz-Eakin, who is a former CBO director.

At this point, it does not appear that Senate Republicans are going to get the 50 votes needed for passage of the BCRA, Miller said.

Senate Majority Leader Mitch “McConnell has a tough job in front of him of trying to get people to stay on board what looks like a sinking ship,” Miller said.

But Holtz-Eakin said Republicans still face a “need to get it done” scenario based on promises to their political base.

“They have to somehow deliver on a bunch of different promises, and that’s going to override any reservations they have with it,” Holtz-Eakin said in an interview.

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

Publication Date: Monday, July 10, 2017