The ACA has stimulated dramatic changes to America’s individual health-insurance market. It has placed more restrictions on insurance pricing (i.e., charging individuals different premiums depending on their health and age), and it has mandated benefit increases for insurance plans.
Such changes have caused premiums on the ACA exchanges to soar by 49 percent, on average; younger, healthier adults have seen their insurance costs rise the most.
To encourage enrollment on the ACA exchanges despite surging premiums, the ACA deploys carrots (premium and cost-sharing subsidies) and a stick (taxing individuals who remain uninsured). In 2015, for example, the average monthly premium subsidy for ACA-exchange enrollees was $263 per month, which reduced monthly premiums by 72 percent, on average — from $364 to $101.
In 2014, after accounting for attrition after the end of the first open-enrollment period (March 31, 2014), 6.7 million individuals had enrolled by December 31. In 2015, 2.6 million additional individuals enrolled (and remained on their plans), raising the total to 9.3 million people enrolled on December 31. If similar trends hold, total enrollment on the ACA exchanges will hit 10 million on December 31, 2016.