ACA stuns many early Colorado exchange subsidy users

In Colorado, the typical consumer who has already used Affordable Care Act subsidies to buy exchange plan coverage for 2017 is on track to spend less on premiums next year.

Managers of Connect for Health Colorado, Colorado’s state-based ACA exchange, reported on the drop in early 2017 exchange plan buyers’ net coverage costs today in a board committee meeting slidedeck.

The ACA exchange system provides a tax credit subsidy that cuts what low-income and moderate-income exchange users pay out of their own pockets for health coverage.

About 70 percent of the consumers who used the Colorado exchange to buy health coverage from Nov. 1 through Nov. 22 qualified for the ACA tax credit.

For those consumers, the ACA tax credit subsidy should cut the average net monthly cost of 2017 coverage to $210, or 1.9 percent less than the current average monthly cost, according to the exchange staff.

The full, unsubsidized monthly cost of the coverage will rise 17 percent to $533.

The Colorado exchange staff did not say how much higher-income exchange users, who must pay the full cost of the premiums out of their own pockets, are paying for their coverage.

The exchange staff reported earlier this year that exchange users who have to pay the full premium themselves were spending an average of $248 per month on coverage this year. Subsidized users have been buying coverage with a fully monthly premium of $448.

ACA public exchange managers in Connecticut said early subsidized 2017 exchange plan buyers there seem to be on track to spend 1.1 percent less on net coverage costs than subsidy users are spending this year.

Net coverage cost confusion

One obstacle to interpreting the data is that the exchange managers are focusing mainly on consumers who are choosing to buy exchange plan coverage for 2017. The exchanges are giving less information about consumers who decided against buying exchange plan coverage.

The early 2017 exchange plan buyers might be the consumers who can see they can get good deals on 2017 exchange plan coverage. The consumers who are facing big net 2017 coverage cost increases might be looking for other coverage options, or deciding to go without major medical coverage in 2017.

Another obstacle is that the Republican leaders of the House and the Senate are working to repeal the ACA. ACA opponents have not talked about whether they would offer any kind of exchange plan subsidy transition arrangements if they succeed at changing or repealing the ACA in the middle of the year.

If ACA opponents eliminate the exchange plan subsidy programs in the middle of the year, the enrollees who have been using subsidies to cut what they pay out of pocket for coverage may end up having to pay the full cost of the premiums themselves.