During the open enrollment period for 2024 health coverage, more than 21.4 million people enrolled in private qualified health plans (QHPs) through the Marketplaces (exchanges) nationwide. ^{This was a 31% increase over the previous record high set in 2023, when 16.4 million people enrolled in Marketplace QHPs.}

In addition to the 21.4 million QHP enrollments, another 1.3 million people enrolled in the Basic Health Program (BHP) coverage offered via the Marketplaces in New York and Minnesota, for a total of more than 22.7 million enrollees.

There are a variety of factors that could be driving the increased enrollment in 2024, including the “unwinding” of the pandemic-era Medicaid continuous coverage rule, the continued enhancement of ACA premium subsidies under the American Rescue Plan and Inflation Reduction Act, as well as state-specific factors.

According to CMS data (for HealthCare.gov ^and here for state-based Marketplaces^{), more than 3.4 million people who had Medicaid/CHIP in March 2023 or a more recent month had enrolled in Marketplace QHPs by the end of December, along with more than 257,000 who had enrolled in BHP coverage.}

The approximately 3.4 million “unwinding” QHP enrollees account for about two-thirds of the approximately 5.1 million additional Marketplace enrollments for 2024 versus 2023. (To clarify, it’s unlikely that everyone who transitioned from Medicaid to the Marketplace in 2023 kept their Marketplace coverage for 2024, so we can’t say that all approximately 3.4 million of the “unwinding” QHP enrollees are among the additional approximately 5.1 million QHP enrollees for 2024. However, the Medicaid unwinding is widely regarded as a primary driver of the enrollment increase in 2024).

A significant portion of the enrollment growth in 2024 was among lower-income enrollees, some of whom may have been among those disenrolled from Medicaid due to an income that increased above the Medicaid eligibility limits. For applicants with household incomes between 100% and 150% of the poverty level, enrollment was more than 54% higher in 2024 than it had been for 2023 Marketplace plans.

On the higher end of the income spectrum, enrollment was about 9% higher in 2024 than it had been in 2023 for enrollees with household income above 400% of the poverty level. (Details of enrollment by income ranges can be seen in the state-level public use files for 2023 ^{and 2024.)}

Continued enhancement of ACA subsidies

Not only is current Marketplace enrollment at a record high, but Marketplace enrollment has grown each year since 2021. ^{This has largely been due to the subsidy enhancements created by the American Rescue Plan (ARP), which were extended through 2025 by the Inflation Reduction Act (IRA).}

For 2024 coverage, 19.7 million QHP enrollees – 92% of the approximately 21.4 million total – are receiving advance premium tax credits (APTC). ^{The average full-price Marketplace premium is $605, but the average after-APTC premium – even accounting for the 8% of enrollees who pay full price – is just $111/month. And nearly 9.4 million enrollees are paying no more than $10/month for their coverage, after APTC is applied.}

Although the subsidy enhancements took effect in 2021, utilization of them has been steadily growing since then, helping to drive enrollment higher each year.

Future of subsidy enhancements uncertain

The subsidy enhancements will continue for 2025 health plans, but it will require a literal act of Congress to extend them past the end of 2025. (To clarify, the basic ACA premium subsidies will continue indefinitely; it’s only the ARP/IRA subsidy enhancements that are scheduled to sunset at the end of 2025.)

The Congressional Budget Office has projected that Marketplace enrollments would drop by about 3.2 million people in 2026 (compared to projected 2025 enrollment) if the APR subsidy enhancements are allowed to expire.

President Biden has called on Congress to make the ARP’s subsidy enhancements permanent. But there is political division on this issue, and the Republican Study Committee’s recently published budget proposal calls for the ARP/IRA enhancements of premium tax credits to end.

So while we can’t say what the future holds, we do know that Marketplace enrollment has reached an all-time high in 2024, driven largely by improved affordability as well as Medicaid disenrollments. And although open enrollment for 2024 coverage has ended everywhere except New York, consumers in every state can still enroll if they’re eligible for a special enrollment period.

According to West Virginia’s Office of the Insurance Commissioner, the sharp increase in enrollment this year was due to a combination of the ongoing ARP/IRA federal subsidy enhancements and the Medicaid unwinding – both discussed above – along with increased outreach and education on the part of insurance carriers and enrollment assisters. This included the first annual Cover West Virginia Day that was held in early January.

But it’s also worth noting that there were some changes in pricing dynamics in West Virginia that might have had an impact. The state confirmed that the carriers continue to set their own CSR-defunding load, as opposed to states like Texas ^{and New Mexico, where state regulators set them.}

(CSR-defunding load refers to the fact that the federal government stopped reimbursing insurers for the cost of cost-sharing reductions in late 2017, and carriers have been adding the cost to premiums since then. In most cases, the cost is added to Silver-level plans, which increases Silver plan prices and thus also increases premium tax credit amounts, which are based on the premium of the second-lowest-cost Silver plan.)

However, a 50-year-old in Charleston, WV, earning $40,000 in 2024 can get a Gold plan for as little as $124/month after subsidies, as opposed to the lowest-cost Silver plan which is $151/month. ^{In other words, low-cost Silver plans are priced higher than low-cost Gold plans.}

This drives up subsidy amounts – which are based on the price of the second-lowest-cost Silver plan – and results in Gold coverage being relatively more affordable. In 2023, that was not the case. The lowest-cost Gold plan was $208/month for a 50-year-old Charleston, WV resident earning $40,000, while the lowest-cost Silver plan was $190/month.

These pricing changes that ultimately made coverage more affordable — combined with Medicaid unwinding and the increased Marketplace outreach activities — resulted in a sharp increase in the number of West Virginia residents enrolled in Marketplace plans.

How and why premiums vary from state to state

Pricing dynamics vary from one state to another. This includes how the available plans in a given area stack up against each other in price and CSR defunding loads. The bigger the pricing difference between the benchmark plan (second-lowest-cost Silver plan) and less-expensive plans, the more affordable those lower-priced plans will be after the subsidy is applied. And higher CSR defunding loads mean higher prices for Silver plans and thus larger premium subsidies.

There are also state variations in income, access to Medicaid, government support for the Marketplace, etc. Several states also offer additional state-funded subsidies, some of which are newly available or expanded as of 2024. With all that in mind, here’s a state-by-state summary of some of the data from the 2024 open enrollment period:

Open enrollment data highlights by state