A study published in the journal Health Affairs suggests that shifting the Affordable Care Act’s enrollment period from late fall and early winter to late winter and early spring may significantly boost the number of Americans signing up for insurance plans under the health law.
Researchers from the Harvard School of Public Health and the Vanderbilt School of Medicine had a simple hypothesis: that Americans – especially lower-income Americans who are less likely to have employer health coverage – are particularly sensitive about their finances during the end-of-year holiday season, and thus subsequently less likely to purchase products such as health insurance during this time.
While it’s impossible to judge the validity of this assertion without actually shifting the enrollment period, researchers found that Internet search volume for health insurance dipped considerably during the holiday season every year between 2004 and 2013. In fact, searches for health insurance were relatively stable at every point during a year except for fourth quarter, when they dropped precipitously:
“[O]ur analysis… demonstrates that November and December are the months when people are least likely to seek out information on health insurance and other recurrent financial expenditures,” wrote the study authors. “In contrast, the early months of the year appear to be a period when people feel less financial pressure and mental stress because of the receipt of tax refunds, most of which are received in February and March.”
The receipt of tax refunds during the early part of the year could be a strong motivation for the working poor, who are among the least likely to have health coverage. As the study notes, less wealthy Americans tend to file their income taxes relatively early, and Americans making between $25,000 and $50,000 per year received an average refund of $2,637. Furthermore, the majority of households that qualify for the Earned Income Tax Credit (EITC) receive the credit by February. Thus, shifting the enrollment period could have a marked effect on the number of low-income Americans purchasing ACA plans.
“Given what is known about how financial stress affects people’s bandwidth for making decisions, holding open enrollment just before or during the holiday season is a mistake,” concluded the study authors. “The ACA’s goals of maximizing enrollment in the health plans and maintaining a healthy balance of enrollees with low and high risks of having high medical expenses are more likely to be achieved if the open enrollment season is shifted to the two months between February 15 and April 15 each year.”
By: Sy Mukherjee