Making the Marketplaces Great Again?
It’s a rare event that one of the most interesting findings in a KFF poll is hidden in the demographics, but that’s the case this month: Nearly half (45%) of the people who get their health coverage in the ACA Marketplaces and the individual market—about 10 million Americans—are MAGA supporters or non-MAGA Republicans. Steve Bannon recently said there were “a lot of MAGAs on Medicaid” and proportionate to the total, that’s even more true of the Marketplaces.
What that means is that the policy changes and cuts being made by Republicans to the Marketplaces will directly affect their own voters. Some of the changes in the reconciliation bill make it tougher to get Marketplace coverage and keep it. Others will make it tougher to get financial assistance. You can find good summaries of the situation here, here and here. But the biggest change of all isn’t in reconciliation (although Democrats sometimes seem to suggest it is). The biggest change will actually come from inaction: If Republicans don’t extend the enhanced ACA tax credits this year, the premiums people pay will increase by more than 75% on average and result in an additional four million people losing coverage. I have written about this recently. All told, the combined impact of the reconciliation changes and the tax credits expiring would result in at least a one-third reduction in Marketplace enrollment. Red states that didn’t expand Medicaid will be hit especially hard. For example, 2.2 million people in Florida are expected to lose health coverage from the changes to the ACA and 1.7 million in Texas.
Republicans may still cut a deal with Democrats on a stop gap measure extending the tax credits. But for now, the silence on such a big issue is striking. So too is the lack of media attention. After the reconciliation bill is put to bed one way or another, whether or not the enhanced tax credits are extended will be the single biggest unresolved health policy issue this year, warranting policymaker, analytic and news media attention.
Republicans are no longer interested in repealing the ACA but seem comfortable shrinking it significantly if they can, so long as they don’t touch protections for pre-existing conditions, which is now a political third rail. With so many of their own voters as well as independents in the Marketplaces potentially feeling the effects of the new policies beginning as early as this Fall, Republicans could pay a political price. But whether they do or not depends on several factors.
Most of all, it matters whether Democrats talk about and campaign on the issue and succeed in convincing voters that Republicans in Congress are responsible for driving up their premiums or causing them to lose coverage. Democrats may or may not choose to do that with so many other fish to fry in the midterms, ranging from tax breaks for the wealthy to Medicaid cuts to the Elon Musk and DOGE mess.
Without a concerted effort by Democrats, it’s less predictable whom these voters will hold accountable. Most enroll through the federal Marketplace portal now run by the Trump administration. They might blame the administration, but so far, we have not seen Republicans, and MAGA supporters in particular, do that on any issue.
Also, in 23 states, people enroll through state Marketplaces, 11 of which are part of state government, while the others are independent or quasi-independent organizations. Each has its own name, like the Massachusetts Health Connector or Your Health Idaho, which is how most people know their plan. The state Marketplaces are financed by fees paid by participating health plans. As a result, governors and states don’t have a stake in the Marketplaces like they do in Medicaid, which is a big part of their budgets. That’s why governors have been much more vocal about Medicaid than “their” state Marketplaces. But you can bet the Marketplaces themselves will go out of their way, even if in an apolitical way, to make sure their members know who changed the rules and increased their costs. Voters enrolled in the Marketplaces might also blame the health plan they signed up with through their Marketplace.
Another challenge is that many of the proposed changes to the Marketplaces in the reconciliation bill are technical and a few are debatable on the merits even if they have real downsides for coverage and operations. It will be difficult to debate the details in a town hall meeting, on a debate stage, or to nail them in a sound bite on television. If Republicans let the tax credits expire, they will become the posterchild for all of the changes made to the ACA. If, on the other hand, Republicans agree to extend the tax credits, they might avoid accountability for the more complex and wonky changes in the reconciliation bill.
But however political accountability plays out, the poll demographics do show something I suspect few have realized: the Marketplaces may have been created by Democrats, but today almost half of enrollees are MAGA supporters and Republicans who will not be “feeling great again” about the changes in reconciliation and the expiration of the enhanced tax credits, if that happens. And they are exactly the working Americans whose votes the two parties are vying for.