The Health Policy Briefing will be off for the next two weeks and back on Thursday, January 8th, 2026. See you next year!
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ACA
Tea leaves from Your Health Idaho’s open enrollment
Speculation about ACA enrollment numbers is a bit of a pastime here at Health Tech Nerds, and Idaho’s unique open enrollment period, which ended Monday, December 15th, is the most interesting data point we’ve got until CMS releases its next snapshot.1
The top-line numbers, reported by the Idaho Capital Sun, are 120,000 enrollees, 3% growth year-over-year, with disenrollments doubling, 24% fewer new enrollments, and evidence of price sensitivity with people shifting to cheaper insurance.
The Exchange Executive Director Pat Kelly did, however, offer a caveat to this unexpected beat on enrollments, predicting a net 17% attrition rate when the premium payments come due.
In the coming months, Kelly said he expects another 20,000 Idahoans will cancel coverage due to affordability concerns. It’ll likely take until April for enrollment to settle, he said, as Idahoans get a better sense of how their insurance premiums fit in their budget, and as insurance companies can cancel coverage for nonpayment.
As always, Charles Gaba of acasignups.net did the math for us and pointed out that if Idaho ends up being a bellwether for the country2, and Kelly is correct about the attrition, the Congressional Budget Office will have nailed their prediction about eAPTC's impact on overall enrollment.
Analysis
Hope for an extension deal this calendar year has diminished to the low single digits, but there’s renewed optimism for a retroactive January deal, which could mitigate some of the attrition, and if there’s a special enrollment period, bring some healthier people back into the market.
Take this momentum for some sort of relief from D.C., and the 17% net attrition estimate you can back into from Idaho’s numbers, and I think there’s room for cautious optimism for the ACA payer lines of business next year.
Estimates for market contraction in the scenario have been anywhere between 20-50%, with Oscar CFO Scott Blackley on the more optimistic side at 20-30%, so 17% would be a modest improvement.
The publicly traded payers also took a conservative approach to rate increases, expecting a sicker risk pool
Payer | 2026 Rate Increase Estimate | Source |
Centene | Mid-30% Range | |
Molina | ~30% Average | |
Oscar Health | ~28% Weighted Average | |
UnitedHealth Group | > 25% Average | |
Elevance Health | Not Disclosed |
If all the stars line up between better-than-expected enrollment numbers, an eAPTC extension that keeps people on their plans, and no surprise to the upside on medical spending, it could end up being a good year for the ACA plans. Or at least some of them… be sure to check out friend of HTN Wesley Sander’s substack on Kaiser’s apparent victim of a winner’s curse scenario in Georgia.
The Hickpuff3 Review
One of the most frustrating challenges for the US Healthcare System is our physician shortage, which is somehow very obviously solvable and yet seemingly intractable. The Niskanen Center hosted a webinar earlier this month on licensing pathways for international doctors and released a white paper that’s worth a read. I’m partial to a kitchen sink approach, which includes growing the number of physicians we train, increasing the number of residency slots, expanding the scope of practice for NPs and PAs, and international pathways like what Niskanen describes.
Peter Orszag, chairman and chief executive of Lazard, and former OMB director, wrote an op-ed in the New York Times with the provocative headline “Why Republicans and Democrats Are Wrong About Health Care” which checks all the technocratic boxes you’d expect from an Obama administration alum. It’s hard to argue with his premises, but it did prompt an interesting discussion in the HTN Slack about AI clinical decision support and its ability to drive the cost of care lower. As Kevin notes, it’s hard to square this with OpenEvidence’s rumored $12 billion valuation. I’ll also point out that the current ACA debate isn’t really about the total cost of care. Instead, it’s about the politically salient but annoying policy trade-offs between affordability, access, and quality, which is a dilemma in a similar shape as the public’s view on what to do about Medicare and Social Security spending:
From time to time, the Office of the Inspector General audits Medicare Advantage plans to make sure there’s evidence that they’re coding and risk adjusting correctly. Humana Health Benefit of Louisiana’s audit was released recently, was pretty eye-opening, with the OIG reporting that “For 218 of the 240 sampled enrollee-years, medical records did not support the diagnosis codes and resulted in $553,049 in overpayments. On the basis of our sample results, we estimated that Humana received at least $10.5 million in overpayments for 2017 and 2018.” The fact that they are releasing audits from 2017 and 2018 at the end of 2025 suggests to me that there could be a significant enforcement multiplier if the OIG were better staffed or if an AI tool could help improve productivity.
In Acute Condition, Olivia Webb Kosloff asks, “Will expensive cell and gene therapies force a different insurance structure?” This is the central question for healthcare policy for the next decade, in my estimation. To quote Olivia, “But if 2010s were focused on value-based care, the 2020s vibes are turning toward high cost, fix-all therapeutics. And that completely changes the calculus of reducing the cost for patients.”
For very good reason, skin substitutes have been in focus from CMS, and earlier this week, they released a fact sheet on the Upcoming Update to the Final Local Coverage Determinations (LCDs) for Certain Skin Substitutes. For Diabetic Foot Ulcers and Venous Leg Ulcers, 18 products made the coverage cut, 154 are at MAC discretion, and 158 will not be covered.
Saved for the slide library
A study from a team of researchers at Northwestern University’s School of Medicine found that “Behavioral health care surged to represent 40% of all medical expenditures for U.S. children in 2022, nearly doubling from 22% in 2011.”
Ashley A. Foster, MD; Anna M. Cushing, MD; Jennifer A. Hoffmann, MD, MS; Katherine A. Nash, MD, MHS; Chuan-Mei Lee, MD, MA; Kenneth A. Michelson, MD, MPH in JAMA
We’ve seen increased investment activity in pediatric behavioral health over the past few years, and this chart is a pretty strong indicator as to why. Companies like Cartwheel and Hazel are focused on school-based behavioral health interventions, which I’d speculate is favorable from a cost-of-care perspective, although I’d note the steep rise in home-based care, which points to an increased acuity story as opposed to just increased prevalence or unit price
More from Health Tech Nerds
A recorded discussion on CVS’s 2025 Investor Day from Kevin and me: if you don’t have 4+ hours to listen to the recording, consider taking 1 hour to listen to your friendly neighborhood Health Tech Nerds.
Today, December 18th, at 1 p.m. Eastern, I’ll be chatting with the Positive Development team about how their DRBI approach differs from ABA, the challenge of measuring quality and value-based care models in behavioral health, and how states are thinking about managing costs when it comes to therapy for patients with ASD. You can register for the discussion here.
Tomorrow, December 19th, I’ll be sitting down with Lawson Mansell, Niskanen’s Health Policy Analyst, to talk about whether Medicaid should pay for Direct Primary Care. You can register for that talk here.
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The Regional Not-For-Profit Health Insurance Shakeout: Thoughts on why so many regional health plans seem to be affiliating, shutting down, or getting acquired, along with some predictions for 2026.
Research Note on CVS Health Investor Day 2025: CVS's Investor Day highlights confidence in core business execution and a refocusing around key pharma assets while the care delivery business is de-prioritized.
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1 Maine and Connecticut have both shared updates recently, both coming in around 90% of last year’s enrollment, but these numbers are from before the 15th, and Connecticut had a marketplace outage.
2 Which you could argue that it won’t be pretty easily since Idaho is hardly representative, but right now, it’s all we have!