Signing Up for Marketplace Coverage Remains a Challenge for Many Consumers

With the eleventh Marketplace Open Enrollment underway, attention is focused on the experiences of consumers when they try to enroll in this type of coverage. With an overwhelming number of plans to choose from in some Marketplaces, complicated rules to determine eligibility for financial assistance, and a limited window of time to make plan selections, it is not a surprise that problems persist.

Across a variety of measures, people with Marketplace coverage were more likely than people with other sources of health coverage to express difficulties in shopping for and enrolling in their health plan, according to data from the 2023 KFF Survey of Consumer Experience with Health Insurance.

While there have been some changes to ease the process of plan selection, subsidy determination, and enrollment, there is a high degree of churn in and out of Marketplace coverage, and enrollment difficulties continue for many consumers.

Experiences Signing Up for Marketplace Coverage

The KFF Survey of Consumer Experiences with Health Insurance is a nationally representative survey of 3,605 U.S. adults with health insurance. Of those surveyed, 880 adults were enrolled in Marketplace coverage, including in states that offer coverage on the federal platform (healthcare.gov) as well as states that operate their own Marketplace (state-based Marketplaces or SBMs). The survey, fielded from February 21, 2023 to March 14, 2023, asked a series of questions about Marketplace enrollees’ experiences when they signed up for their health insurance coverage.

More than one-third (35%) of those with Marketplace coverage found it somewhat or very difficult to find a plan that meets their needs.

Making an appropriate choice among plan options is often difficult. Finding an appropriate plan among the choices available is a problem for over a third of Marketplace enrollees surveyed. About twice as many Marketplace enrollees (35%) said they had a somewhat or very difficult time finding a plan that meets their needs compared to those with Medicare (15%), Medicaid (19%) or Employer-sponsored plan (17%) enrollees.

Applying for coverage and financial assistance

One in four (25%) Marketplace enrollees said it was either very or somewhat difficult to complete the application or enrollment process. That is compared to 12% of people with Medicare and 12% of people with employer-sponsored coverage who indicated difficulty in enrolling. Twenty percent (20%) of people with Medicaid indicated either a very or somewhat difficult application or enrollment process.

One in three people with Marketplace coverage (32%) said it was either very or somewhat difficult to figure out if their income qualified them for financial assistance compared to 20% of Medicaid enrollees, 16% of ESI enrollees, and 14% of those with Medicare.

Comparing options

A large share (41%) of people with Marketplace coverage said it was very or somewhat difficult to compare the doctors, hospitals, and other health care providers you could see for each option compared to fewer adults with Employer-sponsored coverage (32%), Medicaid (27%) and Medicare (19%) who said the same.

Nearly one in three adults with Marketplace coverage (31%) found it very or somewhat difficult to compare copays and deductibles under their plan options, and one in four (25%) found it very or somewhat difficult to compare monthly premiums.

Looking Forward

As the Marketplace has reached record high enrollment in recent years, its importance as a coverage option continues to grow. Nine in ten Marketplace enrollees receive some form of financial assistance through premium tax credits, often with cost sharing reductions as well. Marketplace coverage is unique as it often operates as a transitional source of coverage for millions of people when they find themselves ineligible for employer-sponsored coverage or coverage such as Medicaid or Medicare. There is a high degree of churn in and out of Marketplace coverage, and those signing up for the first time for this coverage will be unfamiliar with the process. In addition, there is likely some variation in consumer sign up experiences across different Marketplaces, as some state Marketplaces have more effective outreach and enrollment strategies.

This survey captures the experience of people who made it through the sign-up process and enrolled. An earlier KFF survey found 6 in 10 uninsured people who tried to sign up for Medicaid or Marketplace coverage said it was somewhat or very difficult to find a plan that met their needs. Even for those familiar with sign-up requirements, complicated and ever-changing rules for Marketplace plan selection and enrollment can make it difficult for many people to find an affordable plan that includes needed providers, even with financial assistance. Efforts to address common problems have developed over time, and will likely continue to focus on these key areas:

Option overload. According to CMS, consumers on the healthcare.gov platform had on average more than 113 plan options to choose from for the 2023 plan year. Too many plan choices with few obvious differences have the potential to result in poor consumer plan selection. Requirements restarted last year for most Marketplaces to have standardized plan options, called “Easy Pricing” plans, combined with a new requirement for 2024 and beyond to limit the number of non-standardized plans available, could help to reduce plan overload. However, these requirements might not reduce the number of choices enough to make a big difference for consumers. New rules for Open Enrollment in federal Marketplace plans this year will automatically reenroll certain individuals with bronze plan coverage into silver plans, where they will receive cost sharing help.

Difficult comparisons. Changes in the works for the coming Marketplace year seek to improve consumers’ ability to understand and compare plans. New plan marketing rules would prevent plans from having deceptive or misleading plan names that do not accurately describe plan attributes. For instance, a plan can no longer have as a marketing name, “$0 cost sharing” plan if only certain services are available for no cost sharing for only a certain number of visits.

Tricky transitions. This Open Enrollment will coincide with the Medicaid unwinding, which is resulting in the largest Medicaid coverage losses in the history of the program. The ability to transition from Medicaid to Marketplace coverage without coverage gaps will test the eligibility and enrollment processes put in place by the Affordable Care Act. New special enrollment opportunities are now available for Medicaid beneficiaries to move to Marketplace coverage. Transitions from employer-sponsored coverage to Marketplace coverage can also prove difficult, including a multi-step process to determine whether a full-time employee with access to employer coverage can qualify for Marketplace financial assistance, and limited standardized information for these employees about how to enroll in Marketplace coverage. For example, a Department of Labor Employer Notice, designed to provide employees with information about Marketplaces, has not been updated to provide information about last year’s changes concerning the “family glitch.”

One-on-one help from Marketplace assisters, including Navigators, will continue to serve a valuable role, alongside efforts to streamline and simplify Marketplace enrollment and educate consumers on the sign- up process.