White, older and self-employed people want to keep their health plans

Remember the furor over canceled health plans? A new study suggests the anger wasn't felt equally across the country.

There are conflicting numbers about how many people saw their individual health policies canceled last year because of Obamacare. The Associated Press pegged the number at 4.7 million, while the Urban Institute estimates it was 2.6 million. Either way, millions definitely saw their policies canceled.

A new study in Health Affairs provides historical perspective on the individual market before the Affordable Care Act. Harvard School of Public Health assistant professor Benjamin Sommers, who also advises the Department of Health and Human Services, points out that the pre-ACA individual insurance market featured high turnover.

Looking back to 2008, he found about one-third of people with individual coverage left their plan within four months. Within one year, just 42 percent had stable coverage in the individual market, and it was just 27 percent after two years. About 80 percent of those people who left their individual plan had another form of coverage within 12 months (with 20 percent of those people obtaining another individual policy).

Sommers estimates that about 6.2 million people leave individual coverage each year, which is more than the reported plan cancellation numbers this past fall. Of course, there's a big difference between leaving coverage and being told your coverage is being canceled because of Obamacare.

So, who's the most likely to be upset about having their plan canceled? For starters, adults ages 35-64 are much more attached to their individual plans, Sommers finds.


(Health Affairs)

Whites, self-employed people and residents of the West and Midwest are also more likely to stay in their plans longer, according to Sommers.

Sommers points out that 65 percent of people in the survey sample earned less than 400 percent of the federal poverty level, meaning they would have qualified for subsidies to purchase coverage in ACA exchanges. That means they could have found cheaper coverage, but it doesn't necessarily mean that they would have — their new coverage, even after subsidies, could have still been more expensive. It doesn't tell us, though, whether they found coverage that was more comprehensive.

The findings also have implications for about half the states that have extended non-compliant health plans for three years, as allowed by the White House. Sommers writes:

"One additional policy consideration is that states that elect to follow the president’s proposal could find that people interested in continuing coverage under previously cancelled plans may be disproportionately older. In this study, long-term coverage in nongroup plans was most common for adults older than thirty-five. This may imply higher-than-expected costs and premiums, given the disproportionately older risk pool."

Jason Millman covers all things health policy, with a focus on Obamacare implementation. He previously covered health policy for Politico.

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Jason Millman · April 23, 2014

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