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President Biden’s special enrollment period has already generated 1 million additional sign-ups on the federal ACA health exchange.
New Health and Human Services (HHS) Secretary Xavier Becerra announced in a press release that “nearly 940,000 Americans have signed up for health insurance through HealthCare.gov as a result of the Biden Administration’s Special Enrollment Period (SEP) for the COVID-19 Public Health Emergency.”
The state of Arizona, a wildcard in political affiliation, operates off the federally-facilitated platform and is seeing the most enrollees the state has experienced in three years, thanks to the special enrollment period. “The number of people who have been able to get coverage in this special enrollment period has been two to three times as high as it was during the same time in previous years” according to a post by ABC. “In Arizona, the numbers went from 6,046 in 2019 to 7,725 in 2020 to this year’s 17,081.”
According to a post by the New York Times regarding the new sign-ups through the federal HR.gov platform, “nearly half bought coverage last month after Congress added billions in subsidies included in the most recent stimulus package.” The surge in sign-ups demonstrates two things:
- Americans are taking advantage of the second chance opportunity to obtain healthcare through the special enrollment period
- The introduction of the reduced premiums and expanded Premium Tax Credit (PTC) eligibility have made coverage more affordable for Americans, and therefore more accessible
The increased number of enrollees in ACA exchanges can be attributed to PTC eligibility expansion, which was included in Biden’s American Rescue Plan (ARP). Specifically, the PTC eligibility expansion allows Americans with income up to 150% of the Federal Poverty Level (FPL) to obtain coverage for $0 monthly premiums and reduced deductible costs. The ARP expansion also allows Americans who earn 400% and above the FPL to obtain coverage for no more than 8.5% of their household income on a monthly basis. The ARP allows these changes to occur for the remainder of 2021 and all of 2022. However, Biden’s $1.8 trillion American Families Plan proposal seeks to make the expansion permanent.
Special enrollment periods were first introduced at the onset of the COVID-19 pandemic and were extended by the Biden administration via an executive order shortly after taking office. The special enrollment period officially launched in February and was slated to run through May 15, but in March, was extended to August 15.
Under normal circumstances, individuals are only permitted to obtain healthcare coverage through the federal HR.gov platform during open enrollment, a period that historically runs annually for six weeks in the November and December timeframe. Unless certain life events occur, such as getting married, having a baby, and losing employment, individuals are not eligible for obtaining healthcare through the federal ACA exchange outside of open enrollment. The special enrollment period gives Americans another opportunity to obtain affordable health coverage outside the parameters of open enrollment.
According to the Kaiser Family Foundation (KFF), there are 36 states that operate through HR.gov and 15 states that operate on their individual marketplace platform.
The additional one million in federal ACA sign-ups does not account for the 15 individual states/jurisdictions, some of which are launching their own special enrollment periods on their own exchanges. These include California, Colorado, Maryland, and the District of Columbia. For details on individual state special enrollment periods, visit the specific state’s enrollment website.
As the data shows, Biden’s ACA reform is generating greater healthcare coverage enrollment, and during the greatest healthcare crisis of our time.
With over two months of the special enrollment period still left, we can expect more Americans to take advantage of the second chance opportunity to obtain healthcare coverage through the federal ACA exchange.
Biden’s advancements to the ACA are having a significant impact on Americans and the trend is likely to continue. An area of the ACA that remains out of the discussion are the Employer Shared Responsibility Provisions (ESRP), also known as the Employer Mandate.
Under the ACA’s Employer Mandate, Applicable Large Employers (ALEs) are employers with 50 or more full-time employees and full-time equivalent employees) and are required to offer Minimum Essential Coverage (MEC) to at least 95% of their full-time workforce (and their dependents) whereby such coverage meets Minimum Value (MV) and is Affordable for the employee or be subject to Internal Revenue Code (IRC) Section 4980H penalties.
With the ACA receiving long-overdue support and the IRS stepping up its enforcement, employers should revisit their compliance process to ensure that they’re taking advantage of all of the opportunities to minimize penalty risk, like Limited Non-Assessment Periods, the rule of parity, and affordability safe harbors. If you’re new to ACA compliance, download The 2021 ACA Essential Guide for Employers to learn more about what is required of employers.
For information on ACA penalty amounts, affordability percentages, important filing deadlines, steps for responding to penalty notices, and best practices for minimizing IRS penalty risk, download the ACA 101 Toolkit.