Individual market: Insights into consumer behavior at the end of open enrollment

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As the Affordable Care Act’s (ACA’s) first individual market open enrollment period (OEP) came to a close in April, we conducted our fifth national online survey to discern insights into how the 2014 individual market has evolved. We conducted the first four surveys between November 2013 and February 2014 and the fifth survey between April 7 and April 16, 2014.

The surveys have focused on both the intentions consumers expressed and the actions they reported taking during the 2014 OEP (especially their reports about how they shopped for, and evaluated, various plans and whether they decided to enroll or go uninsured). The surveys also explored consumers’ awareness of the ACA’s requirements and provisions (including potential subsidies and penalties) and other factors influencing their actions. Each survey included consumers reporting that they enrolled in healthcare coverage for 2014 (either on or off an exchange or by renewing an existing plan), those reporting that they shopped but did not enroll, and those reporting that they did not shop for health insurance during OEP.

All findings in this Intelligence Brief reflect the rapidly evolving individual insurance marketplace through April 16, 2014. As we discuss in the Appendix, these findings cannot be directly compared to publicly reported exchange enrollment data.1 Furthermore, we have based our findings on how respondents described their behavior, attitudes, and demographics, and the descriptions may naturally include some subjectivity. Nevertheless, the size of our sample – 2,874 respondents eligible for qualified health plans (QHPs) in April; 9,533 in total across the five surveys – and the answers they gave to the detailed questions we posed provide useful insights into the individual market’s evolution.

The key findings from our April survey confirm some of our earlier observations and provide an indication of how consumers may behave in the future:

  • Enrollment continued to grow – at the time of our April survey, 90 percent of the respondents who indicated that they had previously had coverage, and 13 percent of those who were previously uninsured,2 reported that they had enrolled in a plan. Of all respondents who reported having selected a new QHP plan at the time of the April survey (either on or off the exchanges), 26 percent reported being previously uninsured. This percentage is similar to the one we found in our February survey (27 percent).
  • Eighty-seven percent of all respondents who reported having selected a new 2014 QHP indicated that they had already paid their first premium. Reported payment rates were higher among those previously insured and those aged 30 or older. A slightly lower percentage of respondents (80 percent) reported that they definitely intend to pay future 2014 premiums;3 that intention was lower among those previously uninsured than among those previously insured (71 percent vs. 83 percent).
  • A higher percentage of those previously uninsured reported having shopped for a plan in our April survey than in our February survey (61 percent vs. 44 percent); however, the conversion rate – the percentage who said they had purchased a plan after shopping for one – remained much lower among the previously uninsured than among the previously insured (for example, 21 percent vs. 84 percent in April, and 23 percent vs. 71 percent in February).
  • As in earlier surveys, perceived affordability was the reason most often given for not enrolling by both previously insured and previously uninsured respondents. About 90 percent of all those citing perceived affordability challenges were subsidy-eligible, and among these subsidy-eligible respondents, awareness of the subsidies has remained low. (For example, 66 percent of the April respondents and 65 percent of the February respondents who were subsidy-eligible and who reported that they had shopped but did not enroll because of affordability concerns were unaware of their eligibility). Among previously uninsured, subsidy-eligible respondents, those who indicated that they were aware of the subsidies were almost three times as likely to have reported enrolling as those who were unaware.
  • Of those reporting that they remained without coverage after the 2014 OEP, 23 percent indicated that they intend to purchase coverage in 2015. Among those who reported having purchased coverage for 2014, 50 percent indicated that they plan to enroll in 2015. Close to half (48 percent) of all respondents not planning to enroll in 2015 were unaware of the penalty for lack of coverage. After they were informed about the penalty, the percentage of respondents reporting that they planned to enroll in 2015 rose by 6 points among those currently uninsured (to 29 percent) and by 5 points among those currently insured (to 55 percent).

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  1. Our findings cannot be directly compared to publicly reported exchange enrollment data because our surveys covered the entire individual market, not just the federal and state exchanges. Furthermore, our survey was conducted only in English, and thus its findings cannot be compared against studies that included questions in Spanish or other languages.
  2. Our surveys measured whether individuals were covered prior to the time of application (as defined by the answer they gave to the question: “Which of the following best describes your primary insurance coverage in 2013? For most of the year I was covered by ….,” with those we defined as being previously uninsured answering “I did not have health insurance, I was uninsured.”) Several other publicly reported OEP enrollment surveys (e.g., those from the Department of Health and Human Services, Gallup, and the New York State of Health Marketplace) measured whether individuals currently had health insurance at the time of their application. Our approach yields a lower estimate of the previously uninsured, because it distinguishes individuals who were uninsured for the majority of 2013 from those who only very recently became uninsured as a result of a plan cancellation. The latter group is categorized as previously insured in our survey. See the Appendix for a more detailed comparison with other publicly reported surveys.
  3. Respondents who answered the question “Are you planning to pay your health insurance premiums for the remainder of 2014?” by selecting “I will definitely make all payments” were categorized as intending to pay.