END OF 2018 OPEN ENROLLMENT PERIOD (42 states)

Time: D H M S

HC.gov Week Nine Projection: 80,000 weekly; OE3 projection now 14.0 - 14.7M *range*

As expected, Week Eight was extremely quiet; not only did the entire week take place after the (extended) deadline for January coverage, but there was also Christmas Eve and Christmas Day to contend with. Needless to say, very few people feel like enrolling in healthcare coverage on December 24th or 25th.

Last year, just 96,000 people chose to do so between 12/20 - 12/26 in the 37 states covered by HC.gov. I was expecting slightly more this year (100K even), but only 74,000 did...26% fewer than the same week in 2014. Whatever else is going on, it's safe to say that the Open Enrollment Periods are starting to become more and more "front-loaded".

So what about this week? Well, it should play out very much the same: Practically all QHP selections going forward should be for new additions, and we have New Year's Eve and Day included. Sure enough, last year there were just 103K added to HC.gov from 12/27 - 01/02...slightly more than Christmas week.

Assuming this year follows a similar pattern, there should be roughly 80,000 people tacked onto the HC.gov total for Week 9, bringing the cumulative total up to just over 8.6 million.

If this does happen, then yes, I'll have to seriously re-evaluate my current 14.7 million OE3 projection...because that will suggest that the final 5 weeks are gonna play out a good 20% lower than my expectations.

And if that's the case, then instead of another 3.5 million new folks signing up, it'll only be around 2.8 million...bringing a grand total of right around 14.0 million even.

I should note that I am not dropping my "official" call by 700K just yet...but I'm putting this out there as a strong possibility. For the moment, let's just say I'm shifting from a hard number (14.7 million) to a range of anywhere between 14.0 - 14.7 million.

HOWEVER, as I noted earlier this afternoon, there's a very important caveat at the bottom; check out the glossary definition of "Plan Selection":

Plan Selections: The weekly and cumulative metrics provide a preliminary total of those who have submitted an application and selected a plan. Each week’s plan selections reflect the total number of plan selections for the week and cumulatively from the beginning of Open Enrollment to the end of the reporting period, net of any cancellations from a consumer or cancellations from an insurer during that time.

Because of further automation in communication with issuers, the number of net plan selections reported this year account for issuer-initiated plan cancellations that occur before the end of Open Enrollment for reasons such as non-payment of premiums. This change will result in a larger number of cancellations being accounted for during Open Enrollment than last year. Last year, these cancellations were reflected only in reports on effectuated enrollment after the end of Open Enrollment. As a result, there may also be a smaller difference this year between plan selections at the end of Open Enrollment and subsequent effectuated enrollment, although some difference will remain because plan cancellations related to non-payment of premium will frequently occur after the end of Open Enrollment.

Here's what this means.

LAST YEAR, the official number of QHP Selections reported through the end of Open Enrollment (2/22/15) was 11,688,074...while the official number of effectuated enrollees as of 3/31/15 (just 37 days later) was only 10,187,197.

That's a "drop" of a whopping 1.5 million people, or 12.8%.

Now, the vast majority of these were people who didn't pay their first premium or who were kicked off their policies due to legal residency verification issues, etc etc...but last year, these reductions weren't subtracted from the official numbers until after Open Enrollment ended. In other words, the 11.7M figure for OE2 didn't subtract the "cruft"; it took another 5 weeks for them to be yanked from the official record.

THIS year, it appears that CMS is subtracting many of these cancellations on the fly (although there will no doubt still be some additional reduction before the Q1 2016 report is compiled).

This means two things:

  • The Bad News: The official OE3 "QHPs Selected" number will end up being slightly lower (perhaps 5% or so?) than it otherwise would have been without this improvement in the record-keeping system. Let's say it ends up being 14.0 million instead of the 14.7 million I've projected; it sounds like up to 700K additional people may have been "purged" from the official record during open enrollment instead of over a month later (which would ironically mean that I'd still end up being dead on target after all in that scenario!)
  • The GOOD News: This should mean that the attrition rate (ie, the gap between the official OE3 total and the Q1 effectuation report) should be much smaller. Instead of a 13% "drop", it should only be perhaps 3% or something along those lines.

Put another way: If this system had been in place last year, instead of 11.7 million, the official OE2 number might have only been, say, 10.5 million...but the Q1 number would still have been 10.2 million (around 3% net attrition instead of 13%).

In any event, here's what the graph looks like now: