Why more people are buying private health insurance plans while thousands are losing Medicaid coverage?

The number of people buying private health insurance policies on the federal marketplace rose slightly in Oregon this year as thousands of people lost their Medicaid program.

The Oregon Health Authority said in its annual report released Tuesday that nearly 146,000 people purchased a private plan for 2024, up more than 2 percent from last year, when nearly 142,000 people bought health insurance through the marketplace.

Officials say some of these new enrollees are likely people who have lost their Medicaid insurance. Last April, the Health Care Authority began canceling the expanded Medicaid program provided by the federal government during the pandemic. It increased the federal rate by 6 percent, and in exchange, states agreed not to drop anyone from free health insurance for low-income residents, regardless of their income.

But that benefit ended last spring, and starting last April, health officials began rolling back coverage for those no longer eligible. The Medicaid program, which provides free medical care, mental health care and dental insurance, is generally available to people under 65 with family incomes up to 138 percent of the federal poverty level - about $21,000 a year for an individual or about $43,000 a year for a family of four.

Oregon Health Authority data show that of the 1.5 million people receiving Medicaid during the pandemic, nearly 109,000 people who were no longer eligible for the program were referred to the marketplace. Health department officials tried to induce them to buy a plan by sending out tens of thousands of notices in 14 languages, sending tens of thousands of emails and text messages, and making tens of thousands of calls.

Amy Coven, a spokeswoman for the Health Care Authority, said the agency doesn't know how many of those people actually bought insurance on the marketplace because the federal government hasn't released that data.

The Marketplace provides the only opportunity to receive federal subsidies for premiums. The annual report says just over 80% of enrollees received federal subsidies, averaging about $525 in federal tax credits. The average net insurance premium was about $164 per month.

Still, only a small fraction of those who lost Medicaid coverage bought private health insurance: The number of people who bought plans on the marketplace before mid-January, when open enrollment ended, increased by only about 3,550 from the previous year.

Coven said this small increase does not mean that the tens of thousands of people who lost Medicaid are now uninsured. She said the results of an e-mail and text message survey of those no longer receiving Medicaid showed that 70 percent had found other health insurance.

"Only a small fraction of respondents reported that they felt insurance coverage was too expensive," Coven said in an email.

Six companies - BridgeSpan, Kaiser Permanente, Moda, PacificSource, Providence and Regence - offered plans in the marketplace this year, and each, regardless of where they live, had at least 26 plans to choose from, the report said.

Most Oregonians get health insurance through their place of employment, Medicaid, Medicare and Veterans Affairs programs. Before the pandemic, 6 percent of Oregonians had no health insurance, but in 2021, that rate dropped to 4.6 percent, according to the latest study.

Health department officials are preparing to expand Medicaid benefits this summer for people whose income is between 138 percent and 200 percent of the federal poverty level - just over $30,000 a year for individuals and $62,400 for a family of four - under a federal agreement. The so-called Bridge Plan would offer the same free medical and dental services as the regular Medicaid program, but its recipients would not be eligible for long-term services or the new climate and housing benefits now being rolled out. Residents can enroll through the ONE system.