Obamacare enrollment is projected to flatten or even decline next year, according to a new report from Standard and Poor’s, leading to a possible increase in insurance costs.
Enrollment was 11.1 million in 2016, but S&P expects that number to fall as low as 10.2 million next year, largely attributable to nonsubsidized consumers—who stand to feel the brunt of premium increases in 2017—dropping out of the marketplace.
“[Standard and Poor’s doesn’t] view this as ‘game over’ for the marketplace,” the agency said, however. It predicted that subsidized customers—the majority of individuals in the marketplace—will be protected from “the full impact” of sticker shock.
“During this period, pricing corrections by insurers are an unwelcome, but somewhat needed side-effect of the evolving insurance marketplace. But there remains a floor to the marketplace population,” the study reads. “The subsidized population will not feel the full brunt of the premium rate increases and will likely re-enroll each year.”
The forecast contrasts with the Congressional Budget Office’s numbers, which project enrollment of 15 million next year.
S&P’s report comes as insurers nationwide have asked states to approve their premium raises in order to correct for sicker—and more costly—populations. Combined with the large financial losses burdening many companies, this contributes to the growing complaints about Obamacare as providers pull out of the market. S&P’s report also noted that this could force some ACA enrollees to drop their coverage if they could not qualify for federal subsidies.
The study, however, said its projections could change if more people decided to enroll in the Obamacare marketplace.
“Although the sticker shock of the premium increases will slow overall growth rates in 2017, continued targeted outreach, regulators’ attempts to improve marketplace rules as they affect insurers, and moderation of premium rate increases beyond 2017 will likely bring growth back to the marketplace in future years,” it noted.
In the meantime, the Obama administration is trying to increase enrollment, especially among younger people.
According to Peter Sullivan at The Hill, “the Obama administration has not yet come out with its own projections for how many people will sign up for coverage next year, though officials said Thursday that they plan to release those numbers before Nov[ember] 1.”
