The 2016 enrollment season is in full swing, but many consumers still aren’t buying health insurance. Top challenges for insurance agents and enrollment workers include convincing millennials that they need coverage and finding affordable options for middle-income families.
Looming tax penalties are a major driver for new policy sales as the deadlines near. Individuals who don’t purchase coverage during the current enrollment period face individual fees of $695 — plus $375.50 per child with a family maximum of $2,085 — or 2.5% of family income in excess of tax filing thresholds if that figure is greater.
The penalty amounts have increased exponentially each year; average household fines were around $200 in 2014 and are expected to average around $661 in 2015 and $969 in 2016, according to Kaiser Health News. The US Department of Health and Human Services (HHS) has stated that it will not extend the 2016 enrollment period beyond its current end date of January 31, as it did in early 2015 to account for those who learned about the penalty while filing their 2014 taxes.
Despite rising penalties, this year’s enrollment estimates are conservative due to consumer resistance in the remaining uninsured. Individuals eager to gain health coverage have largely already done so, and many holdouts believe that they cannot afford coverage. Millennials are also a challenge, as young and healthy consumers object to purchasing coverage they feel won’t be used.
As a result, some families and millennials are choosing to pay penalties in lieu of buying health insurance through employers or on federal and state exchanges.
For insurance companies, gaining a balanced enrollment base is essential to making the health exchanges successful. Many smaller nonprofit insurers have dropped out of the market due to higher-than-expected medical costs. Some larger providers have also cited high costs and utilization rates — presumably from newly insured consumers addressing long-ignored health issues — and are increasing patient cost responsibility as a result.
To boost enrollment of young, healthy consumers, health plan providers are launching social media campaigns, wellness webinars, and website videos and providing straightforward, easy-to-find information on billing and covered services.
Enrollment workers and volunteers are tasked with helping low to middle-income households find affordable coverage options. In addition to new enrollees, agents and navigators must help families facing subsidy reductions, sizable premium increases, or higher out-of-pocket costs find a better plan. Public education and outreach efforts are essential, as HHS estimates that 60% of eligible beneficiaries are unaware they can get premium tax credits.
Meanwhile the Obama administration is encouraging enrollment through community action programs, web campaigns, and other means. The administration advocates shopping around and working with plan navigators to find affordable coverage, stating that 70% of customers can find insurance for $75 a month or less after tax credits.
Consumers are encouraged to scrutinize plan details before choosing coverage, and new tools on the Healthcare.gov site allow consumers to search for plans that cover their medications and preferred doctors.
Despite enrollment roadblocks this season, major accomplishments have been made towards the Affordable Care Act’s top goal of reducing the number of uninsured Americans. The percentage of Americans with health coverage rose from 86% in 2013 to 89% in 2014 as 17.6 million people gained coverage under the ACA, and the figure has risen above 90% for the first time during this enrollment season with more than 1 million newly insured patrons so far.
Anne Law has been a member of the D&B editorial department for more than a decade, providing content for the Hoover’s and First Research products. She currently covers the health care and insurance industries for First Research. For industry news, follow Anne on Twitter.