ACA refocused on the non-subsidized

This morning, the Centers for Medicare and Medicaid Services (CMS) announced that they were cutting ACA navigator funding by 90%:

The Centers for Medicare & Medicaid Services (CMS) today announced a reduction in funding for the Affordable Care Act (ACA) Navigator program to $10 million. The savings from this reduction will allow the Federally-facilitated Exchanges (FFEs) to focus on more effective strategies that improve Exchange outcomes and to reduce the user fee in future years, which would translate into a reduction in premium. This change will directly benefit people enrolled without subsidies [my emphasis] who pay the full premium for their health insurance. In addition, lower premiums will reduce the burden on hardworking American taxpayers who fund the premium subsidies through the FFEs.

Despite receiving $98 million in the 2024 plan year…

 

This is exceptionally similar to the 2017 administration actions.

The best available evidence suggests that Navigators are really good at enrolling highly marginalized individuals and groups. Myerson and Li examined the causal impact of Navigators by leveraging variation in how much counties were exposed to navigator spending:

We studied the impact of Affordable Care Act navigator programs on health insurance coverage, using the 80 percent cut in program funding under the Trump administration as a natural experiment. Our study design exploited county-level differences in the program prior to funding cuts. We did not find that cuts to the program significantly decreased rates of marketplace coverage or any health insurance coverage by 2019; however, our estimates could not rule out marketplace coverage declines of up to 2.7 percent (point estimate −1.3 percent, 95 percent CI: 2.7 percent to 0.1 percent), or total coverage declines of up to 1.8 percentage points (point estimate −0.8 percentage points or −1.2 percent, 95 percent CI: −1.8 to 0.2). Cuts to the navigator program significantly decreased marketplace coverage and total coverage among lower-income adults, and significantly decreased total coverage among adults under age 45, Hispanic adults, and adults who speak a language other than English at home.

More broadly, CMS 2018-2021 was exceptionally focused on prioritizing policy for the ACA to minimize gross premiums for non-subsidized enrollees. In 2025, that is a very small population of undocumented immigrants buying off-exchange and individuals with incomes starting between 600% to 800% FPL. In 2026, the unsubsidized population is everyone with incomes over 400% FPL. We should expect broader actuarial value bands, higher allowed deductibles and narrower allowed networks among other things.

From a political-science perspective, these are normal thermostatic policy changes. But this is likely where policy is going.