A review of automatic reenrollment of consumers in benchmark plans by the Government Accountability Office (GAO) found that most plans identified as benchmark plans (the second lowest cost option within an exchange’s silver metal tier), and the premiums for these plans, changed from year to year. In addition, about 30 percent of consumers were automatically reenrolled in benchmark plans during 2016, while the remaining 70 percent chose to actively reenroll. Finally, the median net monthly premiums—what consumers paid after premium tax credits—increased less from 2015 to 2016 for those who actively enrolled ($5) than for those who were automatically reenrolled ($22) (GAO Report, GAO-18-68, December 14, 2017).
Background. During the open enrollment period for exchange plans under section 1311(b)(6)(B) of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), eligible returning consumers may reenroll in their existing health insurance exchange plan or choose a different plan. Eligible consumers who do not make an active reenrollment selection are to be automatically reenrolled in their existing plan if it remains available. If that plan is no longer available, they are generally automatically reenrolled in a similar plan if one was identified, or the consumers would have to actively reenroll if a similar plan was not identified. While the automatic reenrollment process was established to help ensure continuity in coverage, because the exchanges are dynamic and plan availability and premiums can change from year to year, some have questioned whether it could have unintended financial consequences for consumers.
Review request. GAO was asked to examine: (1) the extent to which benchmark plans remained the same from year to year, and how premiums for benchmark plans changed; (2) the proportion of exchange consumers who were automatically reenrolled into the same or similar plans, and how these proportions compared to those for consumers who actively reenrolled; and (3) the extent to which consumers’ financial responsibility for premiums changed for those who were automatically reenrolled compared to those who actively reenrolled.
Benchmark plan and premium changes. In most of the nearly 2,600 counties included in the analysis, the plan that the GAO identified as the benchmark plan changed from 2015 to 2017. For example, in 85 percent of the counties, the 2015 benchmark plans were not benchmark plans in either 2016 or 2017. The benchmark plan was the same plan in all three years in only 3 percent of counties. In addition, benchmark plan premiums were more likely to increase than decrease from year to year, and increases were higher from 2016 to 2017 than they were from 2015 to 2016. Among all the counties analyzed, the median change in monthly premiums for the benchmark plans was an increase of 11 percent from 2015 to 2016, and 28 percent 2016 to 2017.
Automatic re-enrollment proportions. Among consumers who were enrolled in plans through the federal platform in both 2015 and 2016, 30 percent were automatically reenrolled. Of those, 71 percent were reenrolled in their same plan and 29 percent were reenrolled in a similar plan, because their 2015 plan had been discontinued or was no longer offered in the consumer’s local area. The remaining 70 percent of consumers who enrolled in exchange plans through the federal platform in both 2015 and 2016 actively reenrolled in 2016. Of these, 39 percent chose the same plan in which they had been enrolled in 2015 or the similar plan to which they would have been automatically reenrolled. Sixty-one percent of consumers who reenrolled actively switched to a plan that was neither their 2015 plan nor a similar plan. Fifty-four percent of those who actively switched plans would have been automatically reenrolled in their same plan if they had not actively switched plans.
Change in financial responsibility. The median net monthly premiums (after premium tax credits available under section 1401 of the ACA) for consumers generally increased less from 2015 to 2016 for those who actively reenrolled ($5) than for those who were automatically reenrolled ($22). Consumers who actively reenrolled had a lower median increase in their net monthly premiums than consumers who were automatically reenrolled for both the same and similar plans. Consumers who reenrolled actively, and who switched plans from 2015 to 2016, enrolled in plans with median monthly net premiums that increased the least overall—a median net increase of $1 compared to $13 per month for those who enrolled in the same plan. In addition, enrollment in a similar plan did not generally result in a higher median net premium than enrollment in the same plan, i.e., whether enrollment was active or automatic, consumers’ median net monthly premiums increased less for those who enrolled in a similar plan than for those who enrolled in the same plan.
The GAO noted that its findings were consistent with other work by the HHS Assistant Secretary for Planning and Evaluation (ASPE) that suggested that consumers consider possible cost savings when deciding to switch plans.
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