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Home Affordable Care Act More Americans Paying for ACA Health Plans

More Americans Paying for ACA Health Plans

3 minute read
by Robert Sheen

2 minute read:

It’s no secret that replacing the law is a top priority for President Trump and a majority of Republicans in Congress. Recent data from the Centers for Medicare and Medicaid say otherwise. The figures from the 2017 ACA open enrollment are in and they indicate that Americans, now more than ever, are purchasing health insurance from the ACA marketplace.

As of March 15, 10.6 million Americans had selected a plan, paid their first month’s premium, if applicable, and had coverage in place in February 2018. That is a 3% increase compared to February of 2017. Additionally, the number of individuals receiving premium tax credits (PTCs) has increased as well. The average number of enrollees receiving a PTC for the 2017 plan year was 84% and for February 2018, the number of enrollees was up to 87%. Sabrina Corlette, Research Professor at the Center on Health Insurance Reforms (CHIR) at Georgetown University’s Health Policy Institute, commented in The New York Times, “The premium tax credits have made the market extremely resilient.”

Some have gone as far as to say that the numbers support the idea that the ACA marketplace is stabilizing. Commenting in the same New York Times article, Director of S&P Global Ratings, Deep Banerjee said, “The market is in a better position now than it has ever been since the exchanges have opened.”

Eligibility for PTCs is a driver for ACA coverage. Information released by CMS showed that average monthly enrollment in individual market plans decreased by 10 percent between 2016 and 2017 at the same time premiums increased by 21 percent. CMS said that most of the decrease in enrollment between 2016 and 2017 occurred among people who did not receive PTC subsidies. Non-APTC enrollment declined by 20% compared to a 3% decline in enrollment for people eligible to receive PTC subsidies. The decline in individuals not eligible for PTCs that participated in state exchanges grew larger and more widespread between 2016 and 2017 according to CMS. Enrollment of these individuals declined in 43 states, with six states losing over 40 percent of their non-APTC enrollment.

The figures that show more people actually paying premiums for their insurance coverage suggest that a good portion of Americans who really need assistance in obtaining health coverage are taking advantage of the ACA, which could be a factor in the upcoming national mid-term elections.

While the debate rages over insurance coverage for individuals provided through the ACA government-run health exchanges, the majority of Americans receive their health insurance from an employer. Insurance premiums for healthcare coverage offered by employers will see some increase as well. PwC’s Health Research Institute projects employer medical costs will increase by 6 percent for 2019.

Which brings up an area of the ACA that remains largely out of the debate: the employer shared responsibility provisions, commonly referred to as the employer mandate. Employers anticipating a repeal of the law should reconsider their position as the ACA is here to stay.

The ACA’s employer mandate requires applicable large employers (ALEs), organizations with 50 or more full-time employees and full-time equivalent employees, are required to offer minimum essential coverage to at least 95% of their full-time workforce (and their dependents) whereby such coverage meets minimum value and is affordable for the employee or be subject to IRS 4980H penalties.

Failing to comply with the ACA’s employer mandate can result in penalties in IRS Letter 226J. For the 2015 year, to date, more than 30,000 penalty notices have been issued representing penalty assessments of $4.4 billion.

If your organization has received Letter 226J, see the infographic below on how to respond.

We’re committed to helping companies reduce risk, avoid penalties, and achieve 100% ACA compliance. For questions about the ACA contact us here.

More Americans Paying for ACA Health Plans
Article Name
More Americans Paying for ACA Health Plans
Despite the Trump administration’s moves to continue to undercut the Affordable Care Act, more Americans are paying for ACA healthcare plans.
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The ACA Times
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