Effects of Repealing the ACA Individual Mandate Penalty on Insurance Coverage and Marketplace Enrollment Evidence From State Mandates in Massachusetts and New Jersey

Background: Congress eliminated the individual mandate penalty of the Affordable Care Act (ACA) effective January 1, 2019. Objective: To examine the effects of repealing the ACA mandate penalty on private health insurance coverage and marketplace enrollment by leveraging state-based mandates in Massachusetts and New Jersey. Research Design: We employ synthetic control and difference-in-differences methods to compare insurance and enrollment changes separately in Massachusetts and New Jersey, which had insurance mandates effective in 2019, to other states without such mandates. Subjects: Adults aged 18-64 years with income of 150-300% and above 300% of the Federal Poverty Level who participated in the 2016-2019 American Community Survey (ACS) and adults aged 18-64 enrolled in insurance marketplaces based on state-level data from the 2016-2021 Marketplace Open Enrollment Period Public Use Files (MOEP-PUF). Measures: Any insurance, individually purchased coverage, and employer-sponsored coverage from the ACS and marketplace enrollment from the MOEP-PUF. Results: Changes in any coverage, individually purchased coverage, and employer-sponsored coverage rates are relatively small (generally in the range of 1-2 percentage points) and statistically nonsignificant in both Massachusetts and New Jersey compared with states without mandates. Furthermore, there is no discernable difference by eligibility for marketplace subsidies based on income level in the ACS data. Similarly, estimates for changes in marketplace enrollment are also small overall and statistically nonsignificant. Conclusion: Private insurance coverage rates and marketplace enrollment for adults 18-64 do not appear to have changed thus far owing to the 2019 repeal of the ACA individual mandate penalty.