Texas is cutting into its uninsured problem with nearly 570,000 new signups for affordable health plans for 2023 — a nation-leading growth rate for the third straight year.
The newly insured pushed Texas over the 2.4 million mark for residents seeking coverage on HealthCare.gov during the open enrollment period that ended Jan. 15, according to federal data.
That’s a record high for the Lone Star State and more than double the total from three years ago. Texans’ enrollment grew 31% compared with 12.4% nationwide.
Why are so many Texans embracing the Affordable Care Act plans once dubbed Obamacare?
Give much of the credit to more generous federal subsidies, which began with the pandemic and have been extended through 2025. They made health coverage more affordable for more people, and extended subsidies to those earning more than 400% of the federal poverty level, which was just over $92,000 for a family of three last year.
A rule change enabled family members — for the first time — to add separate subsidized coverage when the breadwinner’s company insurance isn’t affordable for everyone.
Even state Republican lawmakers, who’ve opposed ACA since the law’s passage in 2010, made the exchange plans more compelling for Texans.
In 2021, they passed a “focused rate review” bill, authored by state Sen. Nathan Johnson, D-Dallas, that requires insurers to align premiums across different tiers of coverage.
As a result, many residents had the chance to buy 2023 plans with little or no premiums and much lower deductibles.
A real-life example
DeShannon Monroe, a teacher’s assistant who lives in Arlington, didn’t realize how much coverage she could get for so little money. She couldn’t afford health insurance offered by her employer and had not had job-based insurance since a layoff in 2019.
When her boyfriend got sick and needed hospital care, she helped him get insurance on the exchange — and discovered he didn’t have to pay a monthly premium.
Then she applied for herself and selected a Cigna plan with no premiums and no co-pays to see her primary doctor. It will cost her $25 to see a specialist.
“It’s a relief,” said Monroe, who’s 45 and must monitor her hypertension. “I hope I don’t have to use this for anything major like a hospitalization. But if I need to see a doctor or a specialist, I don’t have to worry about the bill — or not going because I don’t have coverage.”
Daniel Bouton, senior director of family and community health at United Way of Metropolitan Dallas, said the big improvement in affordability surprised new applicants and past users of HealthCare.gov.
“About 80% of our clients talk about not being able to afford a premium,” said Bouton, who coordinates major outreach programs to boost enrollment in the region. “I enrolled one woman whose premium was $3 a month. She had a zero co-pay to see a primary care physician and a $10 co-pay to see a specialist.
“We had people who didn’t believe it,” Bouton said. “We just said, ‘Wow, this is incredible.’”
Last year, 43% of Texas consumers in the marketplace had offers for zero-premium plans in the gold tier — the option with the richest benefits. This year, 73% could have selected zero-premium gold plans, according to the Centers for Medicare & Medicaid Services.
Across all coverage levels, zero-premium offers rose by 16 percentage points, and the state’s rate requirement was a key part of that.
“It helped make net premiums less expensive for many Texans,” said Charles Miller, senior policy adviser at Texas 2036, a nonpartisan think tank studying some of the state’s biggest challenges.
Miller was among the bill’s strong advocates, and the Senate Research Center cited Texas 2036′s projection that the bill “would cover an additional 216,000 Texans at no net cost to the state budget, and result in an additional $1 billion federal marketplace subsidies for Texans.”
Senate and House committees passed the bill unanimously, and it sailed through both chambers.
More detailed data on 2023 enrollment will be released in the coming months, including trends in pricing, coverage selection and sign-ups by counties. It’s likely that many factors, not just Texas’ rate law, contributed to the state’s big increase.
Fixing the glitch
Last October, the government created a rule-making fix for the so-called “family glitch.” That situation occurs when a breadwinner gets coverage from work but cannot afford to add a spouse and kids, and the family is ineligible for subsidies.
Starting in 2023, those family members could apply for separate subsidized plans.
More than 5.1 million people fell into the family glitch in 2019, including 671,000 Texans, according to estimates by the Kaiser Family Foundation.
Higher federal subsidies were in place in 2021 and 2022. The big changes for Texans this year, Miller pointed out, were the family glitch fix and the rate requirements by the state.
For some residents, the two changes work together to improve the offer — making people eligible for subsidized coverage for the first time and enabling them to choose richer plans for less.
Another factor that boosted enrollment was greater outreach by “navigators,” who help people evaluate and select options on the exchange. In addition to having to work through the complexity of insurance, some residents don’t have a computer to compare plans. Or they lack the transportation to visit a health fair or help center.
Navigators try to overcome those barriers, Bouton said.
For 2019 open enrollment, the Trump administration reduced funding to $10 million for the navigator program, down from $63 million in 2016. Fewer than 1.1 million Texans signed up on HealthCare.gov in 2019, the lowest total since the law was fully implemented five years earlier.
The Biden administration increased the award to $80 million, quadrupling the number of navigators. Last year, the government said it would invest nearly $99 million in navigator organizations for 2023 enrollment.
About $2.8 million went to the North Texas region, and 39 certified navigators served people in 16 counties, Bouton said.
Navigators made a special effort to reach young people, regularly going to community colleges to offer help with enrollment, he said. They also targeted barber shops, salons and other small businesses because many of those employees cannot afford the company’s insurance or their spouses had been locked out of the exchange because of the family glitch.
“We just explained their options and tried to keep it simple,” Bouton said. “Do they want to be able to see a doctor when they get the flu? Do they want to pay $25 or $150? How about paying $10 for an antibiotic instead of $35?
“Our pitch was that health insurance means financial protection,” he said.
‘A huge pool to draw from’
Texas’ big gains in enrollment are closely tied to another factor: It has over 5 million uninsured residents, millions more than any other state.
“There’s a huge pool to draw from,” said JoAnn Volk, research professor and co-director of the Center on Health Insurance Reforms at Georgetown University. “I’m glad to see they’re reaching some of them.”
An estimated 18% of Texas’ total population was uninsured in 2021, the highest share in the country and double the U.S. uninsured rate of 8.6%.
Texas is among 11 states that have rejected the expansion of Medicaid, which provides coverage for low-income residents as part of the 2010 health law. The top eight states in net gains on HealthCare.gov have not expanded that program.
In Texas, Republican lawmakers have raised concerns about the costs of expansion despite the federal government covering the bulk of the expense.
As long as Texas leads in the uninsured, it has a chance to lead in enrollment on the exchange.
“This fundamentally goes back to the decision not to expand Medicaid,” Volk said. “It’s great to sign up everyone you can get. But there are many who are completely out of reach because of that decision.”