More than 2 million people who signed up for a health plan under Obamacare aren’t getting a tax credit subsidy because they picked a plan that doesn’t qualify for subsidies, according to a new analysis.
Of the 8.1 million individuals who enrolled for coverage in 2015 in the Obamacare exchanges and were eligible for subsidies, only 5.9 million are actually getting a subsidy, according to the health research firm Avalere Health. The problem is that the other enrollees picked a health plan that doesn’t qualify for subsidies.
“Consumers are picking plans on exchanges based on premiums, rather than out-of-pocket costs,” said Dan Mendelson, Avalere’s CEO, in a press release. “As a result, some patients may be paying more than they need to for care.”
Avalere said some people might be able to get a cheaper plan if they spend a little more up front, then benefit from the subsidy. “While cost-sharing reductions can help reduce what patients pay when they visit a doctor or hospital, some consumers may be unaware of the potential benefits,” he said.
For example, some consumers are likely enrolling in the low-premium bronze plan, but need to be in the slightly more expensive silver plan to qualify for subsidies, Avalere said. “Meanwhile, other consumers may not be aware that cost-sharing reductions may not be available,” the firm said.
The nonpartisan Congressional Budget Office has estimated that about 3 million consumers will forego getting subsidies because they signed up for a bronze plan. Avalere recommended more consumer education to detail the benefits of the plans and the subsidies.
The Obama administration said that more than 11 million people “enrolled” in Obamacare as of this year, but that about 10.2 million people ended up paying for a healthcare plan.
