Analysis: Even without an "Open" #COVID19 SEP at HC.gov, up to 6 MILLION Americans would likely enroll via normal SEPs *if they knew they could do so*.

I've been making a LOT of fuss lately about how important it is for CMS Administrator Seema Verma to give the green light to an official "Open" COVID-19 Special Enrollment Period (SEP) via the federal ACA exchange (HealthCare.Gov). Last week I projected that if every state were to offer a full 60-day "open" SEP ("open" means that any uninsured U.S. citizen or eligible documented resident could sign up without requiring a Qualifying Life Event), somewhere between 2.5 - 3.3 million Americans would likely enroll during that 2-month period.

Of that number, I projected that around 1.8 - 2.3 million additional people would likely reside in the 38 states hosted by HealthCare.Gov, with the remainder living in the 12 states which are offering COVID-specific SEPs (although the deadlines in those states vary, and some do require enrollees to jump through at least minimal hoops to enroll).

As I've noted many times before, most of the more than 26 million Americans who've lost their jobs over the past five weeks already qualify for a standard 60-day SEP anyway due to losing their employer-sponsored healthcare coverage...except that a) Many of them are likely to have tremendous difficulty acquiring and submitting the documentation required by traditional "coverage loss" SEPs and b) Even if they can get the proper documents, there's a large question as to whether the CMS backend support team is in a position to be able to handle such a massive spike in enrollments, documentation, verification and customer service in such a short timeframe.

FORTUNATELY, while CMS is still refusing to launch a formal "open" COVID-19 SEP, they recently revealed that they're quietly waiving the documentation requirement for those who enroll via standard SEPs. This should streamline the process and maked it easier for more people to #GetCovered more quickly...assuming they actually know that they're eligible.

Historically, the limited data I've found suggests that on average, between 6,000 - 9,000 Americans typically enroll in an off-season ACA exchange Qualified Health Plan (QHP) each and every day using the standard SEP process. Around 60% of these are due to people losing their existing employer coverage, while the other 40% are for other reasons, such as moving, getting married/divorced, giving birth/adopting a child, getting out of prison/the military, turning 26, being declared ineligible for Medicaid due to an income increase and so on.

This year, of course, the biggest new factor is "losing existing employer coverage". In other words, there's three different numbers to look at for each state:

  1. How many people would normally enroll via normal SEPs
  2. How many additional people have or will enroll this year via normal SEPs; and
  3. How many additional people would enroll this year via an open COVID-19 SEP...if one were to be offered.

#1 has already been addressed and is mostly irrelevant this year: between 6,000 - 9,000 per day (let's call it 8,000 nationally), or roughly 240,000 per month.

#3 is what I've been obsessing over the past few weeks. I even got a shout-out from the Democratic Governor's Association this morning when they sent out a press release touting my national and state-by-state projections (my only quibble: They didn't include my "likely" caveat...remember, my projections are based on limited data and certain assumptions).

So, we know that perhap ~8,000 people historically enroll via SEPs per day nationally. And I've projected that perhaps 41,000 - 54,000 additional people would enroll per day nationally if an "open" COVID-19 SEP was available in all 50 states + DC.

So that leaves #2: How many people will (or already have) enroll via the SEPs which are currently available? This number is obviously somewhere in between #1 and #3, but where?

To figure this out, I start with the baseline (8,000/day). Given the huge uncertainty involved, for this projection I'm playing it safe and knocking this down by about 10% to 7,200 per day. I've broken out my per-state estimates to roughly match each state's percentage of total Open Enrollment Period QHP selections. For instance, California holds around 13% of all OEP enrollments, so I'm assuming around 940 SEP QHPs per day (13% of 7,200), and so on. Some states are a bit higher or lower.

Next, I need to figure out how many more people are filing for unemployment each week (thus making them eligible for a standard SEP) than normally would. For this, I've downloaded the weekly unemployment insurance filing records for every week of 2020 through 4/11 (unfortunately, last week's report with ~4.4 million more unemployed isn't available on a state-by-state basis yet, but I've estimated that as well; I'm assuming it'll be around 80% as high as the week ending 4/11).

I've compared the average since 3/21 (which covered filings the week ending 3/15) against the average weekly filings from the first 11 weeks of the year.

Here's what it looks like (note: none of these numbers are seasonally adjusted, but that shouldn't make too much difference since I'm comparing the average ratio of one over the other):

For instance, in my own state of Michigan, 7,851 residents filed for unemployment on average during the first 11 weeks of 2020 (up through mid-March, when the first major business closures/stay at home orders started happening in Michigan). From 3/15 - 4/18, however, over 1.2 million people filed for unemployment...an average of 244,000/week, or an insane 31x as many people per week on average.

Now, not all of those 1.2 million Michiganders are going to be eligible for a standard SEP, since not all of them had employer coverage anyway...but then again, not all of the 7,800 who normally file for unemployment during normal circumstances are eligible either. And of course, even of those who are eligible, not all of them actually enroll in a "coverage loss" SEP...but again, not all of them do under normal circumstances either.

I estimate that around 1,200 Michiganders typically enroll in standard SEPs per week under normal circumstances (roughly 2.4% of the 7,200 who do so nationally).

So does that mean that over 37,000 Michiganders are enrolling per week via standard SEPs? Not at all.

First, remember that only around 60% of those SEPs are due to people losing their employer coverage; the rest are for other various Qualifying Life Events. I estimate that perhaps 102 Michiganders typically enroll via a normal "coverage loss" SEP per day...again, under normal circumstances. That would bring the theoretical increase down to around 3,160/day or 22,100/week...again, in theory. Over a 60-day period, that would theoretically add up to a whopping 190,000 Michiganders enrolling in an ACA exchange plan via the "coverage loss" SEP.

What about the other 40% of standard SEP enrollees? Well, I'm sure some of those have been disrupted as well, but I'm assuming those will remain around the same for the most part. In Michigan's case, these should average just 68/day, or around 3,200/day for all SEPs combined. That would total roughly 194,000 over a 60-day period (again, in theory only).

Nationally, the average multiplier is around 20x. That is, 26.4 million people have lost their jobs in the same time period that around 1.32 million typically would.

Nationally, this would add up to roughly 98,000 "Loss of Coverage" SEPs and 2,900 other SEP enrollments nationally per day, or around 101,000/day total. Of those, around 79,000 should be happening via HealthCare.Gov states, for a whopping 6.0 million nationally over a 60-day period (4.8 million in HealthCare.Gov states)...but again, this assumes that:

  • CMS is able to handle the massive load of people trying to sign up; and...
  • People actually know they're eligible to sign up for a loss of coverage SEP; and...
  • Those who attempt to enroll are able to actually acquire the appropriate documentation; and

Update: The bullet above is no longer relevant in most states now that HC.gov has stated that they're waiving the documentation requirement.

  • All of those people's incomes--after accounting for their expanded unemployment benefits and the one-time $1,200 check they're supposed to receive--are high enough to make them still eligible for subsidized ACA exchange policies as opposed to Medicaid expansion (or nothing at all, if they live in a nonexpansion state)

Unfortunately, all four of these are very much unknowns at the moment.

  • CMS likely isn't equipped to handle 15x their normal SEP enrollment load (80K/day vs. 5,400).

Update: In fact, in the same article in which it was announced that CMS is waiving the documentation requirement, it was also stated that they have NO INTENTION of actually ADVERTISING this fact...or even of going out of their way to let anyone know that they're likely to be eligible for a SEP in the first place..

  • The documentation problems are the same as I described last week.
  • And the income factor is a total wildcard.

In other words, no,4.8 million people are not going to actually jump through all of the SEP hoops at HealthCare.Gov any more than 1.2 million are likely to do so via the 13 state-based exchanges which have mostly removed those hoops (Idaho is sort of in between). The reality is likely to be a much more modest increase.

How much more modest? Again, that's impossible to say. I presume it'll be somewhere between the ~7,200 who typically utilize SEPs each day in normal times (~430,000 over a 60-day period) and the ~101,000/day I've estimated who are theoretically eligible at the moment (around a whopping 6 million nationally). That's a pretty wide range, of course...the big question is how many people are actually aware that they're eligible in the first place?