How the ACA Performed During 2019 Open Enrollment

About 8.4 million people signed up during the Affordable Care Act's open enrollment period for 2019 coverage. That's 3.8 percent fewer enrollees than the previous year's open enrollment, which drew in 8.7 million new members. However, it isn't as much of a drop as experts expected it would be.

Leading up to the open enrollment period, experts believed that the elimination of the mandate penalty, the lack of budget for ACA advertising, and expanded access to short-term health plans would mean more people dropping out and fewer people signing up. When coupled with growing uncertainty about the ACA's future, analysts expected payers would move to or stay on the sidelines. As we know now, that hasn't been the case.

Good news or bad news for health plans?

Though the difference between enrollment numbers for 2018 and 2019 was smaller than expected, the market's declining performance and the ACA's uncertain future keep most payers in a tentative exploration phase. Some payers have refused to put their plans on the exchanges; others have limited their additional investments in the market.

Looking ahead to 2020 open enrollment, it's important to remember that uncertainty about the ACA doesn't necessarily spell doom for insurers. Unemployment is shrinking, and more payers are selling on the exchanges this year. Prices for premium plans have even decreased by about 1.5 percent.

It's also significant that markets outside of the ACA-controlled individual market — group and Medicare Advantage markets, for example — have been doing well despite similar predictions of large-scale dropouts and reduced sign-ups. All in all, 2019's open enrollment was disappointing but still better than expected. It certainly wasn't the dire news that most of us had been bracing for.

The bold approach for 2020

The timid approach some payers are taking toward the market is primarily driven by a lack of clarity. No one knows whether the government will continue to support the ACA or will decide to replace it, or when. Now, there's even more uncertainty thanks to the "Medicare for all" discussion coming to the foreground.

The ACA represented some major changes when it was first rolled out. There was clear guidance on the high-level direction of the law, yet there were never clear details on its implementation, and the confusion has only grown. Some definite political direction (as far as market management) would go a long way in helping the market take off.

In the meantime, some pioneering payers are finding success even in the individual market. They're chasing market share and finding the right balance of network/benefit configuration and competitive pricing. As with any market, their strategies depend on how much risk they're willing to accept.

A payer with leaner plans and an aggressive mindset should absolutely jump in now and leapfrog more risk-averse carriers. Find the right balance and invest what makes sense, keeping the ACA market strategy fluid enough to respond to the changes that are sure to come. Despite uncertainty, payers can beat the odds and grow beyond their own expectations.