By Madison Berry*

Halloween has come and gone, but October health policy researchers have left us plenty of sweet treats. This month, we reviewed studies about the impact of a permanent extension of the American Rescue Plan Act’s (ARPA) subsidy expansion, COVID-19’s effect on health spending, and the importance of continuous marketplace coverage for pregnant people.

Stacey McMorrow, Jessica Banthin, Matthew Buettgens, Michael Simpson, Genevieve M. Kenney, and Clare Wang Pan, Extending the American Rescue Plan Act’s Enhanced Marketplace Affordability Provisions Could Benefit Nearly 1 Million Uninsured Children and Parents, Urban Institute, October 2021. Using the Urban Institute’s Health Insurance Policy Simulation Model (HIPSM), the researchers analyze the benefits for children and parents of extending the ARPA marketplace subsidy expansion.

What it Finds

• If the ARPA’s subsidy enhancements were made permanent, almost 1 million uninsured children and parents would gain access to insurance.
  • Among those gaining access, approximately 300,000 would be children, including roughly 67,000 under 6 years old.
  • Around 267,000 uninsured parents who would gain coverage would have a child under 6 years old.
• Almost two-thirds of the coverage gains for families under a permanent ARPA subsidy expansion would be among children and parents with incomes between 200 and 400 percent of the federal poverty level (FPL).
• Among children and parents with non-group coverage before the ARPA, approximately 4.5 million would experience an average household premium reduction of 28 percent per person overall, and families with incomes below 200 percent FPL would save 41 percent per person.
• Household spending on out-of-pocket costs and premiums would decrease by an average of 18 percent per person overall and 25 percent per person in families with incomes below 200 percent FPL.
• Even with permanent APRA subsidy enhancements, an estimated 3.3 million children and 6.3 million parents would remain uninsured in 2022 absent additional policy changes.
  • Among parents, 41.2 percent of those who would remain uninsured (approximately 2.6 million) would be ineligible for subsidized coverage due to their immigration status or because they reside in a state that has not expanded Medicaid under the Affordable Care Act (ACA); approximately 636,000 parents would be eligible for Medicaid if their state opted to expand the program under the ACA.

Why it Matters

The ARPA’s enhanced marketplace subsidies have significantly improved health insurance affordability, allowing more families to enroll in and retain coverage. Permanent subsidy expansion would provide even more families with access to comprehensive coverage, but if the ARPA’s temporary affordability provisions are allowed to lapse, the trend of increasing uninsurance rates among children and parents is likely to return. And even with permanent subsidy expansions under the ARPA, over 3 million children and 6 million parents will remain uninsured in 2022. In addition to advocating for a more permanent affordability solution for marketplace plans, policymakers need to close the Medicaid coverage gap and increase enrollment and outreach efforts (for example, through proposed reforms in the Build Back Better Act). Expanding coverage will also require a solution for those who lack access to affordable health insurance due to their immigration status.

Giorlando Ramirez, Jared Ortaliza, Emma Wager, Lucas Fox, Krutika Amin, and Cynthia Cox, Insurer Filings Suggest COVID-19 Will Not Drive Health Spending in 2022, KFF, October 18, 2021. Researchers with the Peterson-KFF Health System Tracker reviewed 311 rate filings for 2022 to analyze the effect of COVID-19 on premiums, and also looked at health care utilization data from the U.S. Census Bureau’s Quarterly Services Survey (QSS).

What it Finds

• Overall health care service revenue in the second quarter of 2021 was 3.1 percent lower than expected, based on pre-pandemic spending.
  • Physician services revenue was 5.5 percent lower than projected.
  • Outpatient care center revenue was 3.7 percent lower than projected.
  • Hospital revenue was 2.3 percent lower than projected.
  • Laboratory services revenue was 11 percent higher than projected (likely due to an increase in COVID-19 testing services).
  • Nursing home revenue was 0.5 percent higher than projected.
• Out of 311 reviewed rate filings, 272 had publicly available 2022 premium changes, ranging from a 28.5 percent decrease to a 25.6 percent increase. Half of rate changes fell between a 1.8 percent decrease and a 6.2 percent increase.
• Less than a third of insurer rate filings (29 percent, or 91 insurers) quantified the impact of COVID-19 on premiums.
  • Among these insurers, the impact of COVID-19 on individual market costs ranged from -2.6 percent to 8.4 percent, and half of insurers fell between no impact and a 1.0 percent increase.
• A majority of insurers did not project an impact from the ARPA subsidy expansion on 2022 rates; 16 percent of filings (50 insurers) quantified the premium impact of the ARPA’s subsidy expansion.
  • Among these 50 insurers, 29 anticipated the APRA’s subsidy expansion will reduce costs (with impact ranging from a 5 percent decrease to a 0.2 percent decrease), one expected a positive effect on cost (0.6 percent increase), and 20 estimated no impact.
  • Only a few insurers anticipated a decrease in average enrollee morbidity from the enhanced subsidies.

Why it Matters

This study includes findings consistent with CHIR’s July analysis of insurers’ proposed 2022 rates in states with early filing deadlines. The COVID-19 pandemic had significant implications for health care spending after public health concerns prompted consumers to cancel elective care and delay or forego other health services. Despite an anticipated resurgence of utilization in 2021, health care service revenue reveals lower-than-expected utilization. As we continue to simultaneously struggle with and recover from the pandemic, this study suggests that insurers expect health care utilization and spending will return to normal in 2022; less than a third of marketplace filings reviewed in this study included adjustments for COVID-19. And while marketplace enrollment increased following the ARPA’s subsidy expansion (and a special enrollment opportunity), only a fraction of insurers projected an impact of the ARPA-enhanced subsidies on their 2022 rates. Insurers’ prediction of a return to the status quo may pan out, but uncertainty surrounding the pandemic and the eventual unwinding of the Public Health Emergency suggest a number of unknowns in the marketplace and subsequently future health care costs.

Sarah H. Gordon, Charlotte L. Alger, Eugene R. Declercq, and Melissa M. Garrido, The Association Between Continuity Of Marketplace Coverage During Pregnancy And Receipt Of Prenatal Care, Health Affairs, October 2021. To understand enrollment patterns of pregnant people covered through the ACA’s marketplaces, researchers analyzed data from the 2016-2018 Pregnancy Risk Assessment Monitoring System (PRAMS), evaluating increased prenatal care accessibility, timeliness, and quality associated with continuous marketplace enrollment from preconception through the postpartum period.

What it Finds

• Compared to respondents with “continuous” prenatal marketplace enrollment (those enrolled from preconception and throughout their pregnancy), respondents with “discontinuous” prenatal marketplace enrollment (those who enrolled in marketplace coverage during pregnancy) experienced:
  • A 10.8 percent lower rates of adequate prenatal care;
  • A 6.4 percent lower rate of timely prenatal care initiation; and
  • A 13.2 percent lower rate of having twelve or more prenatal care visits.
• Respondents with continuous prenatal marketplace coverage tended to be of an older age demographic and have higher incomes, and were more likely to identify as white.
• Almost 40 percent (39.7 percent) of respondents with “discontinuous” prenatal marketplace coverage (those who enrolled during pregnancy) reported being uninsured at preconception, while 36.8 percent were enrolled in employer plans and 15.2 percent were enrolled in Medicaid.

Why it Matters

This study highlights the care consequences associated with uninsurance and churning between insurance coverage programs. While these effects are not isolated among pregnant individuals, people who are pregnant may face increased health risks from churn or uninsurance due to the importance of initiating prenatal care early. Ensuring people have access to care before they are pregnant or at least early in their pregnancy is crucial to reducing adverse maternal health outcomes and improving the health of the baby. This study shows that continuous coverage throughout pregnancy has numerous benefits, including more frequent prenatal visits and more adequate and timely prenatal care. Further, almost 40 percent of respondents with discontinuous prenatal enrollment reported being uninsured at preconception, underscoring the need for lowering barriers to coverage to promote continuous or early access to prenatal care. The demographic differences between respondents with discontinuous and continuous enrollment also highlight coverage disparities by race, age and income level, and the need for policies and outreach strategies to promote more equitable coverage and care access. Policymakers should consider ways to improve access to marketplace coverage throughout pregnancy, such as designating pregnancy as a qualifying life event for mid-year enrollments, funding robust and tailored outreach efforts, and reducing enrollment obstacles and complexities to ease the process of signing up for coverage.

*Madison Berry is serving as an intern this semester with Georgetown CHIR. She is a 2022 candidate for a B.S. in Health Care Management and Policy at Georgetown University.