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Forecasting Enrollment and Subsidies in the ACA Exchanges

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Congressional Budget Office November 14, 2015 Forecasting Enrollment and Subsidies in the ACA Exchanges Roundtable: Forecasting the Effects of Public Policies on Budgets and People Association for Public Policy Analysis and Management Miami, Florida Jessica S. Banthin, Deputy Assistant Director Health, Retirement, and Long-Term Analysis Division


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Relevant CBO Reports ■ Cost estimate for H.R. 4872, Reconciliation Act of 2010 (Final Health Care Legislation) (March 20, 2010), www.cbo.gov/publication/21351. ■ Estimates for the Insurance Coverage Provisions of the Affordable Care Act Updated for the Recent Supreme Court Decision (July 24, 2012), www.cbo.gov/publication/43472. ■ Updated Budget Projections: Fiscal Years 2013 to 2023 (May 14, 2013), www.cbo.gov/publication/44172. ■ Updated Estimates of the Effects of the Insurance Coverage Provisions of the Affordable Care Act (April 14, 2014), www.cbo.gov/publication/45231. ■ Updated Budget Projections: 2015 to 2025 (March 9, 2015), www.cbo.gov/publication/49973. CONGRESSIONAL BUDGET OFFICE 1


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CBO’s Estimates of Exchange Enrollment and Subsidies ■ CBO usually updates its baseline projections three times a year; the spring baseline is the major update for the Affordable Care Act (ACA) Exchange. ■ Types of changes – Changes in law – Changes in the economic forecast – Technical changes from new information, data, regulations, and changes in modeling assumptions ■ This presentation focuses on five of those baseline estimates – – – – – March 2010, initial ACA estimate July 2012, updated for the Supreme Court decision May 2013, spring baseline April 2014, spring baseline March 2015, spring baseline CONGRESSIONAL BUDGET OFFICE 2


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Main Challenges in Forecasting Exchange Enrollment ■ New program ■ Duration of the phase-in period ■ Effect of the individual mandate ■ Supreme Court decision regarding Medicaid expansion CONGRESSIONAL BUDGET OFFICE 3


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CBO’s Projections of Subsidized Exchange Enrollment ■ Many people who obtain insurance through the exchanges receive federal subsidies, but some do not. ■ The following figures focus on the number of subsidized enrollees. ■ CBO’s estimates of subsidized exchange enrollment are presented as average annual enrollment for the year. CONGRESSIONAL BUDGET OFFICE 4


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CBO’s Projections of Subsidized Exchange Enrollment in 2014 (Average for the year) Millions of People 8 7 7 7 Average Subsidized Exchange Enrollment, Calendar Year 2014 6 6 5 5 4 3 2 1 0 March 2010 July 2012 May 2013 CONGRESSIONAL BUDGET OFFICE April 2014 5


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CBO’s Projections of Subsidized Exchange Enrollment in 2015 (Average for the year) Millions of People 14 12 12 11 11 10 10 8 8 6 4 2 0 March 2010 July 2012 May 2013 April 2014 CONGRESSIONAL BUDGET OFFICE March 2015 6


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CBO’s Projections of Subsidized Exchange Enrollment in 2019 (Average for the year) Millions of People 25 22 20 20 19 19 17 15 10 5 0 March 2010 July 2012 May 2013 April 2014 CONGRESSIONAL BUDGET OFFICE March 2015 7


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Subsidized Exchange Enrollment Projections Millions of People 23 July 2012 21 19 April 2014 17 15 March 2015 March 2010 13 11 9 7 5 2014 2015 2016 2017 2018 2019 CONGRESSIONAL BUDGET OFFICE 2020 2022 2024 8


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Main Challenges in Forecasting Exchange Premiums and Subsidies ■ Health status of new enrollees ■ Continued slowdown in health care cost growth ■ Extent of insurer participation in new program ■ Characteristics of plans offered ■ Income and age distribution of enrollees, which determines aggregate subsidies CONGRESSIONAL BUDGET OFFICE 9


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CBO’s Projections of Exchange Premium Tax Credits and Cost-Sharing Subsidies in 2014 Billions of Dollars 35 30 30 25 20 23 19 15 15 Fiscal Year 2014 Amount for Exchange Subsidies 10 5 0 March 2010 July 2012 May 2013 CONGRESSIONAL BUDGET OFFICE April 2014 10


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CBO’s Projections of Exchange Premium Tax Credits and Cost-Sharing Subsidies in 2015 Billions of Dollars 70 59 60 50 50 44 40 36 28 30 20 10 0 March 2010 July 2012 May 2013 April 2014 CONGRESSIONAL BUDGET OFFICE March 2015 11


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CBO’s Projections of Exchange Premium Tax Credits and Cost-Sharing Subsidies in 2019 Billions of Dollars 160 137 140 120 123 113 107 100 83 80 60 40 20 0 March 2010 July 2012 May 2013 April 2014 CONGRESSIONAL BUDGET OFFICE March 2015 12


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Exchange Premium Tax Credits and Cost-Sharing Subsidies Billions of Dollars 180 160 140 March 2010 July 2012 May 2013 April 2014 120 March 2015 100 80 60 40 20 0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 CONGRESSIONAL BUDGET OFFICE 13


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