ACA enrollment is down across the country, except in New Mexico. What's happening in the state

Enrollment in policies under the Affordable Care Act has dropped this year for the first time since 2019. And that enrollment is down in 49 of the 50 states across the country.

The one exception: our neighbor to the east, New Mexico, where enrollment is actually up 14% over last year. Arizona’s drop, by the way, is one of the biggest in the country, at 30%.

Julie Rovner, chief Washington correspondent with KFF Health News, spoke to The Show more about it.

Full conversation

MARK BRODIE: Julie, good morning.

JULIE ROVNER: Good morning to you.

MARK BRODIE: So what’s going on? Let’s start nationwide. We heard so much about when the subsidies to help people pay for their policies went away after Congress got rid of them, that there would be fewer people on ACA plans. Is that kind of what’s happening here?

JULIE ROVNER: That is kind of what’s happening here. It’s important to remember there are still subsidies for people who get ACA plans, but during COVID, those subsidies were made much larger and were expanded further up the income scale. So a lot more people were able to get subsidies and a lot of people who had already been getting subsidies were able to get bigger subsidies. That’s what expired.

So we’re back to the original Affordable Care Act subsidies. And what happened is exactly what most people predicted. A lot of people discovered they could no longer afford their insurance, and they either bought down, as we say they got less generous plans, they moved maybe from a silver plan to a bronze plan, or they dropped their plans altogether.

MARK BRODIE: OK, so why did Arizona have such a big drop? It’s one of the biggest in the country.

JULIE ROVNER: Yeah, it is. Well, one thing we know is that the states that ran their own marketplaces, that tend to have more sort of aggressive help with people enrolling and keeping people enrolled, they had much smaller reductions in the number of people.

Arizona was one of those that uses healthcare.gov, the federal marketplace, so it was among those that had the larger drops anyway. It’s not entirely clear exactly what was unique to Arizona, but one of the things we know is that people who were sort of above that four times poverty, of which there are a lot of sort of young retirees, were hit particularly hard because they lost subsidies entirely. And I suspect that’s a lot of what happened in Arizona.

MARK BRODIE: OK, I also wonder, over the last several years about health care providers or insurance providers pulling out of particular markets across the state and other places around the country, too. Does a lack of options contribute to this, especially when it comes to what folks may or may not be able to afford?

JULIE ROVNER: Yes, it absolutely does. And we are seeing providers pull back in certain places. Basically, the Affordable Care Act was set up — it was originally a Republican idea — to use the marketplace. And so you have private insurers who are competing to offer coverage. And when they are in places where they think they can no longer compete well, they’re going to pull out.

And we’ve seen insurance companies come and go over the years, the 15 or actually it’s really more like 13 years that these plans have been up and running. And depending on what goes on at the federal level, whether they decide that this is a good year for them to stay or not.

But we’re also seeing it’s not just insurance companies, we’re seeing health care providers — doctors and hospitals — who have to decide whether or not they’re going to participate with these plans. So in some cases, there may be fewer providers available, even if there are insurers still in the market. And people are making decisions based on how much they can afford and whether they can actually make good use of these insurance plans.

MARK BRODIE: Right. OK, so let’s move one state to the east, where in New Mexico, enrollment is not only up, it’s up double digits over last year — the only state in the country that saw an increase. What is happening there?

JULIE ROVNER: Well, New Mexico is also the only state in the country that actually replaced using state money the federal subsidies that expired. So it’s a wonderful sort of natural experiment in how important were those additional subsidies. Obviously, they were critically important because in New Mexico, where they still exist, even though they’re not coming from the federal government anymore, we saw enrollment increase. In all the other 49 states and D.C., we saw it decrease.

MARK BRODIE: So is it really just that simple that residents in New Mexico are still able to get help affording the policy that works best for them?

JULIE ROVNER: Well, it’s obviously a lot more complicated than that. But yes, in terms of enrollment in the Affordable Care Act, yeah, it really is still that simple. There’s still a lot of problems in the health insurance market, in the employer market, in the Affordable Care Act market. We’re seeing changes in Medicaid. I mean, there’s going to be a lot of churn with people’s health insurance in the next couple of years.

But in this case, just talking about the expiration of those expanded subsidies, it seems pretty clear that when people have enough money to be able to afford their health insurance, they’re going to keep it.

MARK BRODIE: Are there any other states that have talked or are talking about doing anything similar to this?

JULIE ROVNER: Well, I know California — I mean, there are nine states that actually have some state subsidies. And we do know that in those nine states, the enrollment drops were smaller. So more people were able to keep their plans. But states are not going to have the money to basically make up for these federal subsidies.

And as I just mentioned, states are also looking at big cuts to the federal Medicaid — their participation in federal Medicaid program. So they’re going to have more money that they’re going to be asked to make up, and states are already in difficult financial straits. And I suspect that a lot of states are going to prioritize Medicaid for people who are lower down on the income scale before they prioritize people on the Affordable Care Act who are maybe just a little bit higher up on the income scale. But so we’ll have to see what states are able to do.

MARK BRODIE: Sure. All right. That is Julie Rovner, chief Washington correspondent with KFF Health News. Julie, thanks so much. I appreciate it.

JULIE ROVNER: My pleasure.

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