This installment of the ACA Spotlight shows the number of Americans with Cost-Sharing Reductions (CSRs) at the end of the open enrollment period for 2016 coverage in the 38 states that used the federal HealthCare.gov Marketplace. Of the 9.6 million HealthCare.gov enrollees, 5.6 million (or 56%) had CSRs. Additional people in State-based Marketplaces (12 states and the District of Columbia) also benefitted from CSRs; however comparable data are not currently available.
All 38 states have a significant number of people who benefit from Cost-Sharing Reductions and would be affected if CSRs were to become unavailable. As seen in the interactive maps above (use the pulldown menu to toggle between the percentages and total numbers):
- Southern states had the largest percentages of enrollees with CSRs
- Four states represented almost half of CSR enrollment (2.7 million people): Florida, Texas, North Carolina, and Georgia.
- The states with the highest proportions of CSR enrollees with incomes below 150% of FPL were Mississippi, Florida, Alabama, Georgia, and South Carolina.
- Of these 38 states, the percentage of enrollees with CSRs ranged from 35% to 73%.
- A majority – 28 states – had more than 50% of their enrollees benefitting from CSRs.
As of March 2017, CSRs continue to be available to those who qualify. However, potential threats to the funding of CSRs could come from the pending appeal of the House v. Burwell (Price) litigation; Congressional action through budget reconciliation; and legislative action to significantly alter the ACA. According to a recent study, annual out-of-pocket costs to the average consumer could spike from $1,112 to $3,162 if CSRs were eliminated.
Health coverage sold through the Affordable Care Act (ACA) marketplaces require consumers to pay for a portion of the medical services they receive, in addition to monthly insurance premiums. This out-of-pocket “cost-sharing” typically includes an annual deductible, co-pays and/or co-insurance. However the lowest-income consumers may qualify for discounts on cost-sharing, also known as Cost-Sharing Reductions (CSRs). To be eligible for CSRs, a consumer must enroll in a silver plan and have an annual household income between 100 – 250% of the federal poverty level (FPL).
CSRs are a key component of the financial assistance provided by the ACA that helps make health care affordable for millions of Americans. However the benefit of CSRs may not be obvious to consumers because the federal government pays these costs directly to the insurers. Savings appear only when enrollees use and pay for medical care that is covered under their plan. Without CSRs, ACA enrollees may find out-of-pocket costs unaffordable and, as a result, may delay or avoid seeking care.
Only enrollees with incomes between 100% and 250% FPL ($11,880 to $29,700 for individuals or $24,300 to $60,750 for a family of four in the 48 contiguous states in 2016; Alaska and Hawaii have different FPLs) are eligible for CSRs, and they must enroll in a silver plan to receive CSRs. The numbers here reflect all enrollees that would receive the discounts that CSRs provide if they were to seek medical care, but not all do so. The data do not include people who meet the income requirement but did not select a silver plan.
CSRs reduce the amount an individual has to pay when using health care services by increasing the share of costs the insurer pays. The increased share of costs the insurer must pay is based on a consumer’s income level:
- Consumers with incomes between 100% and 150% FPL qualify for 94% cost-sharing reductions, meaning the silver plan will pay 94% of the cost of covered services on average.
- Consumers with incomes between 150% and 200% FPL qualify for 87% cost-sharing reductions, meaning the silver plan will pay 87% of the cost of covered services on average.
- Consumers with incomes between 200% and 250% FPL qualify for 73% cost-sharing reductions, meaning the silver plan will pay 73% of the cost of covered services on average.
CSRs also help lower eligible enrollees’ out-of-pocket (OOP) limit. The ACA sets the maximum amount that consumers must pay in out-of-pocket costs for any Marketplace plan during a coverage year; the OOP limit for HealthCare.gov plans in 2016 was $6,850 for an individual and $13,700 for a family. With CSRs, the OOP limit in 2016 for eligible consumers varied from $2,250 to $5,450 for individuals and $4,500 to $10,900 for families, depending on income level.
This ACA Spotlight shows the number of HealthCare.gov plan enrollees with Cost-Sharing Reductions (had an income between 100% and 250% FPL and enrolled in a silver plan) by the end of the open enrollment period for the 2016 coverage period. The data used are based on the U.S. Office of the Assistant Secretary for Planning and Evaluation (ASPE) report, Health Insurance Marketplace Cost Sharing Reduction Subsidies by Zip Code and County 2016. The report provides data only for the 38 states in which consumers used HealthCare.gov to purchase and enroll in plans for the 2016 coverage period.
Using the drop-down menu at the top of the Spotlight, the user can view either the number or percent of enrollees with CSRs in total or by FPL level. The resulting heat map and bar chart infographics illustrate data for all 38 states. Additionally, when selecting the percentage of enrollees with CSRs, a user can click on a state to see a pie chart in a separate window with a breakdown by the enrollees’ FPL. Note that all data presented take into account Alaska and Hawaii’s differing FPLs as compared to the 48 contiguous states.
Social Interest Solutions (SIS) used its MAGI Visualization Cloud to support the presentation of the infographics seen in this ACA Spotlight. The MAGI Visualization Cloud is a component of SIS’ MAGI Cloud platform, used throughout SIS’ ACA Spotlight series to produce its data and infographics. Learn more about the MAGI Cloud platform.
Data used in this Spotlight are available upon request to firstname.lastname@example.org.
- Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services
Centers for Medicare & Medicaid Services, U.S. Department of Health & Human Services
- Manual for Reconciliation of the Cost-Sharing Reduction Component of Advance Payments for Benefit Years 2014 and 2015, March 2016
- Loss of Cost-Sharing Reductions in the ACA Marketplace: Impact on Consumers and Insurer Participation
- The ACA's Cost-Sharing Reduction Plans: A Key to Affordable Health Coverage for Millions of U.S. Workers
- Kaiser Family Foundation