It's been a constant refrain, and a bogus one. As it turns out, the individual health insurance market—where all these cancellations happened—has constant turnover. That churn is quantified with a new study by Benjamin Sommers, an assistant professor at Harvard's School of Public Health and an advisor at Health and Human Services. Looking at data from the Census Bureau's Survey of Income Program and Participation from 2008-11, Sommers shows just how much volatility there has always been in this market, well before the Affordable Care Act.
Just two-thirds of the people in the sample that Sommers looked at had the same policy after just four months. And after one year, just 42 percent had the same policy. After two years, it was down to 27 percent. The people in the same who lost these non-group policies moved on to coverage with new employers, or ended up in public insurance, a different individual policy, or didn't get insurance again.
To see just how dramatic the changes are in this market, take a look at this graph showing the changes by age group in just one year, 2008:
In this context, reports that recent cancellations of coverage may affect as many as 4.7 million adults (though precise estimates are lacking) are likely capturing a great deal of the normal turnover in this market. The findings presented here also suggest that overall coverage rates in the United States are unlikely to fall as a result of these cancellations: Most people who left nongroup coverage in this study acquired other insurance within twelve months, even before the ACA offered increased coverage via the Medicaid expansion and tax credits for Marketplace insurance.And as for the people who did lose their plans under the ACA, Sommers found that 65 percent of them will qualify for subsidies under the new law, and "many of them will experience even larger declines in total out-of-pocket spending because of reduced cost-sharing requirements." So all the claims about "sticker shock" are going to be as overhyped as all the claims about how many people lost insurance because of the law.