Decrease in ACA Enrollment in North Bay
New enrollments in Affordable Care Act plans among North Bay residents have plummeted compared to last year, likely due to uncertainty over enhanced subsidies that are set to expire at year’s end.
Jessica Altman, executive director of Covered California, reported that this week saw a 35% drop in new enrollments across North Bay counties compared to last year. This aligns with an estimated 30% decline in new enrollments statewide.
New enrollments refer to individuals who are either signing up for a California-covered plan for the first time or who haven’t enrolled in the past year. Altman mentioned that these new registrations make up just a fraction of those eligible for coverage in California. Interestingly, overall enrollment—comprised of both new and renewing members—has remained steady, according to her.
“We haven’t observed an overall decline in enrollment because there are still more people joining and renewing,” she noted. “But that doesn’t guarantee it won’t change.”
She speculated that potential new members might be in a “waiting and watching” mode as lawmakers in Washington, D.C., deliberate on the fate of enhanced tax subsidies that dramatically lower the costs of health plans via exchanges like Covered California.
“They may come to browse, but they’re hesitant to commit,” Altman explained in a telephone interview. “There’s still plenty of time left in the enrollment period, and some might still sign up. It really depends on these tax credits, though. It’s hard to say.”
Impact on Sonoma and Napa Counties
With these ACA subsidies poised to end this month, over 23,000 residents in Sonoma County and 5,800 in Napa County could face increased health insurance premiums next year if Congress does not extend the temporary subsidies, Covered California indicated.
Sonoma County has experienced an 11.7% rise in total enrollment since 2021, thanks to premium tax credit enhancements. Similarly, Napa County has seen an 11.9% increase during this period.
If the enhanced federal tax credits are allowed to lapse, residents will encounter average premium hikes of 89% in Sonoma County and 85% in Napa County. This translates to a rise in monthly premiums of about $175 in Sonoma County and $171 in Napa County, according to state exchange data.
The U.S. Senate is scheduled to deliberate on both Democratic and Republican health plans this week. Democrats are advocating for a three-year extension of the existing subsidy, while Republicans propose eliminating the enhanced tax credit and reallocating funds into health savings accounts for those purchasing bronze-level or “catastrophic” plans, an approach intended to alleviate out-of-pocket costs for Americans.
For individuals aged 18 to 49 earning under 700% of the federal poverty line, the Republican plan promises $1,000 in HSA funds, while those aged 50 to 64 would receive $1,500. Critics, however, argue that these amounts won’t adequately cover the increase in monthly premiums once the tax credits disappear.
Altman expressed that her agency is closely observing discussions in both legislative chambers.
“To protect consumers from significant premium hikes next year, it’s essential to extend the enhanced premium tax credit,” she stated in an email. “This directly helps to lower monthly premiums and contributes to decreasing uninsured rates on a national level.”
Once the enhanced credit expires, many middle-income residents in Sonoma and Napa counties will have to pay their full health insurance premiums.
In Sonoma County, over 4,190 enrollees will lose all their subsidies, while in Napa County, around 1,040 individuals will face the same outcome.
For an average middle-income family in Sonoma County, the current subsidy is $506 monthly, making their insurance cost $988. Meanwhile, in Napa County, the average subsidy is $482 for a premium of $968.
As of now, a significant decline in eligible California updates hasn’t been observed. Altman noted that “watching and waiting” for plan renewals usually means enrollees aren’t cancelling or changing their health plans.
“Since we automatically renew most enrollees, we haven’t seen a drop in renewals or a noticeable uptick in current enrollees switching plans compared to previous years,” she said.
“Typically, there are some who cancel—perhaps due to a new job or age-related transitions. There are valid reasons for cancellations, but we haven’t seen a dramatic decline.”
Still, Altman acknowledged that people might be “waiting to see” how things unfold with the subsidy situation.
