More Children Enrolled in ACA Marketplace Coverage in 2022, But Marketplaces Still Remain Modest Source of Health Coverage for Children

Medicaid and the Children’s Health Insurance Program (CHIP) currently cover more than 40 million children.  In comparison, relatively few children rely on the marketplaces for their health coverage.  But new data released by the Centers for Medicare & Medicaid Services (CMS) show 1.3 million children were enrolled in marketplace plans during the 2022 Marketplace Open Enrollment period, either through the HealthCare.gov platform or through their state’s State Based Marketplace. This represents a 300,000, or 29 percent, increase compared to 2021 child enrollment levels, which was the largest increase in child enrollment since 2016 and a larger percentage increase than for any other age group between 2020 and 2021. This comes after the COVID-19 special enrollment period opened last year also saw more than 300,000 kids newly enroll, indicating that more children under age 18 are now receiving coverage through the marketplaces.

As the chart above shows, child enrollment in the Marketplace has held steady at about 1 million kids since 2016. The recent addition of more than 300,000 children thus represents a substantial increase, relative to long-term enrollment trends, although kids’ share of total enrollment remained unchanged at 9 percent.

However, total child enrollment and child enrollment changes in the marketplaces varied by state. As in previous years, Florida enrolled the most children in 2022 with 238,808 kids, followed by Texas (207,311) and California (127,513). Five states—Arkansas, Texas, Mississippi, Iowa, and Alabama—also saw coverage gains of more than 50 percent, while Kentucky, DC, Massachusetts, and Idaho all saw slight declines (see chart below). Additionally, states that used the HealthCare.gov platform saw an increase of 32 percent, while states using their own State-Based Marketplace saw relatively smaller gains of 24 percent.

Along with Medicaid and CHIP, marketplace coverage has played a key role in preventing a rise in the uninsured rate, especially for adults, during the pandemic, in part due to new policies that have helped make Marketplace coverage more affordable for millions of families. This includes the American Rescue Plan Act provision substantially increasing marketplace subsidies. (Although the House-passed Build Back Better reconciliation bill would have made these enhanced subsidies permanent, they’re currently set to expire at the end of the 2022 plan year unless Congress extends them.) While Medicaid and CHIP played a far greater role in avoiding increases in the number of uninsured children — Medicaid and CHIP child enrollment has risen by 4.8 million, or more than 13 percent, between December 2019 and October 2021 — the new enrollment data nevertheless show that marketplaces were a modest, but growing, source of coverage for children. Moreover, the marketplaces may see further child enrollment increases, as the Biden Administration recently announced a new proposed rule to address the family glitch, which will allow children whose families are offered unaffordable family coverage through their employers to qualify for marketplace subsidies.

In addition, some of the estimated 37.3 million children enrolled in Medicaid may shift to the marketplaces when the COVID-related continuous coverage protection is lifted. Nearly 6 million of these kids could be determined ineligible for Medicaid at that time, according to estimates from the Urban Institute with about 6 in 10 becoming eligible for CHIP coverage. At least five percent of children losing Medicaid could be eligible for subsidized marketplace coverage while an additional four percent could enroll in the marketplaces if the higher premium subsidies enacted by the American Rescue Plan are extended beyond 2022. If these transitions take place and all eligible children enroll, the Marketplace could see an influx of as many as 550,000 kids, nearly double this year’s new enrollments. On the other hand, additional estimates suggest that if the enhanced subsidies are allowed to expire, more than 100,000 children could lose their marketplace coverage and become uninsured in 2023. It will thus be critical for both the federal and state-based marketplaces to work in partnership with state Medicaid programs to ensure that newly eligible children losing their Medicaid coverage do not fall through the cracks and end up uninsured. They will also need to ensure that children who remain eligible for Medicaid and CHIP are not inappropriately enrolled in marketplace plans.

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