Impact of Benefit Inserts on Health Plan Selection and Utilization Among Renewing Covered California Members

Background:

The Affordable Care Act (ACA) established health insurance marketplaces (commonly referred to as ACA marketplaces) to provide affordable insurance coverage. In addition to premium subsidies, administered through the form of advanced premium tax credits (APTCs), low-income consumers are eligible for reduced out-of-pocket costs when they enroll in a Silver plan through the ACA marketplaces. These ACA benefits, known as Cost-Sharing Reductions (CSRs), improve the plan generosity (through the form of lower copays and deductibles) while keeping premium costs at the level of a Silver plan. Traditionally, lower out-of-pocket costs are associated with higher premium payments, such as in the Platinum tier, whereas high out-of-pocket costs are paired with lower premiums, as in the Bronze tier. These CSR benefits are available for consumers who enroll in the Silver metal tier and have an income below 250 percent of the Federal Poverty Level (FPL).

California launched its own state-funded Cost-Sharing Reduction (CSR) program in 2024, increasing the benefit levels for those eligible for federally funded CSRs. These plans are referred to as "enhanced CSR plans." In the 2025 plan year, California expanded eligibility for enhanced CSR plans to all enrollees, regardless of income. This policy change improves affordability and accessibility by offering coverage comparable to Gold plans but with lower monthly premiums for all enrollees. Members already enrolled in Silver plans were automatically upgraded to the enhanced CSR plans, while those in other metal tiers (Bronze, Gold, or Platinum) had to take action to switch during the annual renewal period to benefit from these new plan designs. This study explores how additional communication in the form of an informational flyer insert about the new enhanced CSR plan benefits and their expanded eligibility may have helped overcome inertia, likely due to informational and awareness barriers, for renewing consumers.

Project Objective:

The primary objective of the study is to evaluate whether including an informational flyer insert with renewal notices affects consumer behavior in two key areas:

• Enrollment in Enhanced CSR Plans: Assess whether members currently enrolled in other metal tiers are more likely to switch to the enhanced CSR plan when informed about the new benefits.
• Health Care Utilization for Current Silver Plan Enrollees: Determine whether members already enrolled in Silver plans, who were newly eligible for enhanced silver benefits, increased their utilization of health care services after receiving the flyer insert which has information such as '$0 deductible', 'Lower monthly premiums', '$0 for preventative visits', 'lower costs for primary and emergency care visits', 'lower medication costs'.

This evaluation seeks to understand if targeted communication can effectively inform consumers about the availability of more affordable and generous health coverage options, thereby encouraging a shift towards plans that offer better value and accessibility.

Inclusion criteria

• Households who qualify for automatic renewal of their Covered California health plan as of October 4.
• Households that were enrolled in Covered California on the subsidized application.

Exclusion criteria

Households that were no longer enrolled as of January 31, 2025. This includes people who chose to cancel their coverage in 2024 and those who were automatically disenrolled due to changes in eligibility during the open enrollment period.)

• Households that were included in the affordability crosswalk

• The affordability crosswalk is a Covered California process that moves eligible individuals with lower incomes to Silver CSR plans during renewal.
• This population includes members with incomes below 250% of the federal poverty level who were enrolled in Bronze plans and eligible for $0 premiums with Silver plans, members below 200% of the federal poverty level who were enrolled in Gold plans, and members below 150% of the federal poverty level who were enrolled in Platinum plans.
• Approximately 23,000 members are excluded from the experiment due to this restriction.
• Households with members enrolled with the carrier Valley Health Plan and Dental Health Services.

• This group was excluded due to changes in plan availability that necessitated a special notice.
• Approximately 30,000 members are excluded from this experiment due to this restriction.