On June 18, the Congressional Budget Office (CBO) released a report describing its predicted trends in health insurance coverage for the next decade. The CBO serves as an independent, non-partisan source of budget analysis for the U.S. Congress. Its projections for future enrollment in health coverage programs provide a benchmark for the agency’s estimates of how proposed legislation will impact the federal budget and national coverage levels.
In its latest report, the CBO projects that the all-time-high rate of insurance coverage in 2023 represents a peak, and significant numbers of people will become uninsured between 2024 and 2034. However, these projections are not our destiny; several policy actions and investments in the Affordable Care Act (ACA) can help sustain 2023’s low uninsurance rate, and even bring it lower.
The CBO’s Projections
The CBO estimates that just 7.2 percent of the U.S. population was uninsured in 2023—an all-time low. However, they do not project that number to be repeated. The agency expects our uninsured rate to rise to 9.2 percent in 2028 and fall again only slightly in the out-years, to 8.9 percent by 2034. The agency identifies several factors driving the increase in our uninsured rate, in particular:
- The Medicaid “Unwind”: States resumed eligibility redeterminations for Medicaid and the Children’s Health Insurance Program (CHIP) in 2023, after pandemic-related continuous coverage requirements expired. Between 2023 and 2024, the CBO projects that this will result in a loss of 13 million people from Medicaid and CHIP, including 5 million children.
- Expiration of Enhanced Premium Tax Credits: The CBO projects that enrollment in the ACA’s health insurance Marketplaces will peak at 23 million in 2025 but drop to 16 million by 2027. This decline is largely because enhanced premium tax credits, initially funded by Congress in 2021, are slated to expire at the end of 2025.
- Immigration “surge”: The CBO is incorporating into its estimates a surge in immigration between 2022 and 2026, The agency estimates that recent immigrants will be four times as likely as the general population to be uninsured.
Countering these trends, the CBO projects a modest increase in enrollment in employer-sponsored insurance (ESI), which it expects to increase from 164 million in 2023 to 170 million in 2034, largely due to greater levels of employment. In addition, as the population ages, Medicare enrollment is expected to rise, from 60 million in 2023 to 74 million in 2034.
Coverage Loss Is Not Inevitable: Timely Policy Action Can Build On Recent Gains
Our national all-time-low uninsured rate in 2023 did not arise by accident—it was the result of concerted efforts over the last few years to build on and improve the ACA.
Enhanced Premium Tax Credits
In 2021, Congress enacted a temporary expansion of the ACA’s premium tax credits to reduce the cost of Marketplace health plans; these were extended in the Inflation Reduction Act of 2022 to last through the end of 2025. Thanks to the enhanced premium tax credits, Marketplace enrollment exceeded 21 million in 2024, and four out of five enrollees were able to purchase a plan for $10 or less.
Investments In Marketplace Outreach And Enrollment Assistance
In the last few years, the Biden administration has significantly increased spending to build consumer awareness about Marketplace coverage and provide tailored consumer assistance to those who need help with the enrollment process. These strategies have been demonstrated to help increase enrollment.
Fixing The ‘Family Glitch’
In 2022, the Biden administration issued a rule eliminating a restriction preventing an estimated 5 million family members of people with employer-sponsored insurance from accessing premium tax credits on the ACA Marketplaces. The rule, CBO estimates, has enabled one million people to gain coverage.
Medicaid Continuous Coverage Requirement
In response to the COVID-19 pandemic, Congress provided states with a temporary boost in Medicaid funding. In return, states were required to provide Medicaid and CHIP enrollees with continuous coverage throughout the public health emergency. When states resumed eligibility redeterminations in the spring of 2023, over 94 million people were covered in either Medicaid or CHIP.
State Medicaid Expansions
Since 2021, four new states—Oklahoma, Missouri, South Dakota, and North Carolina—have taken up the option to expand Medicaid eligibility to nearly all adults under 138 percent of the federal poverty level. Forty states plus the District of Columbia have now adopted Medicaid expansion under the ACA, covering an estimated 18 million people in 2023.
Continuous Eligibility For Children
About half the states have previously taken up the option to provide 12 months of continuous eligibility for children in Medicaid and/or CHIP, regardless of household income changes. In 2023, Congress required all states to implement continuous eligibility for children in their Medicaid and CHIP programs, beginning January 1, 2024.
Reducing Paperwork Burdens
Through regulations and operational changes, the Biden administration has reduced the bureaucratic hoops that people must jump through to enroll in and renew their Marketplace, Medicaid, and CHIP coverage.
These efforts have collectively led to our nation’s lowest-ever uninsured rate. However, critical policies enacted to build on and sustain the ACA’s coverage gains have or are slated to expire, prompting the CBO to project significant coverage losses.
Looking Ahead
Policymakers do not need to accept these projected losses as pre-ordained. Several crucial policies and investments can help keep people in insurance coverage and continue to reduce the ranks of the uninsured. Examples include:
- Expanding Medicaid in the remaining 10 states;
- Permanently extending the enhanced Marketplace premium tax credits before they expire in 2025;
- Enabling and supporting affordable coverage options for non-citizens;
- Continuing to invest in and support Marketplace outreach and consumer assistance;
- Conducting targeted outreach to re-enroll low-income people, including children, who remain eligible for Medicaid and CHIP but were disenrolled for procedural reasons during Medicaid unwinding; and
- Continuing to reduce administrative burdens for people enrolling in Medicaid and Marketplace coverage, including through widespread adoption of automated transitions between the two coverage programs, further state take up of multi-year continuous eligibility in Medicaid and CHIP for young children, and adding 12 months of continuous eligibility for adults.
In the last few years, the US has made tremendous progress providing more people with access to affordable, comprehensive health insurance coverage. Coverage not only improves families’ financial security, it is proven to improve access to primary and preventive care, health outcomes, and the management of chronic disease. The CBO’s projections demonstrate the harm that will arise without policy action: 32 million people uninsured and lacking access to affordable health care. Policymakers have a clear roadmap to prevent the projected coverage losses and build on coverage gains—they just need to take it.
Author’s Note
The Robert Wood Johnson Foundation provided support for the author’s time drafting this article.
Sabrina Corlette, “CBP Projections Are Not Destiny: Policies, ACA Investments Can Change Trajectory,” Health Affairs Forefront, June 20, 2024, https://www.healthaffairs.org/content/forefront/cbo-projections-not-destiny-policies-aca-investments-can-change-trajectory. Copyright © 2024 Health Affairs by Project HOPE – The People-to-People Health Foundation, Inc.
