Big surge in enrollment lifts Obamacare marketplaces

23 Dec 2015 | Author: | No comments yet »

Despite threats, Obamacare still winning.

FOR the first six years of the Obama era, many Republicans made an apocalyptic case against the president’s health care law. WASHINGTON—Nearly six million people have signed up for 2016 insurance coverage on the federal exchanges since the November start of open enrollment, a pace that Obama administration officials said Friday outstrips last year’s and indicates the health law’s success.Government health officials crowed Friday over a big surge of new customers to the federal Obamacare marketplace, which significantly increased the total number of people signed up in insurance plans compared to the same time last year.

By Thursday night, slightly fewer than 6 million people — 40 percent of them new customers — had selected a health plan for 2016 from HealthCare.gov, the exchange that sells private insurance in 38 states, officials said. “We’re obviously pleased,” said Andy Slavitt, the acting administrator of the federal agency that oversees Obamacare, the Centers for Medicare and Medicaid Services. “It’s clear now that many people have been waiting to purchase coverage until this enrollment cycle.” HealthCare.gov’s tally does not include enrollment numbers from the 13 other Obamacare exchanges that are being run by individual states and the District of Columbia. “There was an unprecedented amount of traffic at the call center and an incredible amount of activity on HealthCare.gov,” in the days leading up to Thursday, which was the deadline for enrolling in coverage that will be effective Jan. 1, said Slavitt. The law survived two Supreme Court challenges; it survived the website fiasco during its rollout; it survived the wave of cancellations and premium increases; it successfully enrolled millions of the uninsured. Thanks to the Affordable Care Act, he noted, the uninsured rate in the United States is now below 10% and far fewer Americans are “one illness or accident” away from financial ruin. At which point Republicans, never particularly eager to grapple with the actual details of health care policy, began talking about the issue less and less. While retaining consumers is important, administration officials need to attract uninsured consumers to meet and hopefully exceed the modest goal they set of 10 million people insured on the exchanges at the end of 2016.

Since the government shutdown in 2013 failed to stop the law from taking effect, the word “Obamacare” has lost pride of place in G.O.P. talking points. On the 2016 campaign trail, terrorism and immigration are the hot-button topics, tax cuts once again the big domestic policy promise, and it’s clear that any real health care talk will wait until the general election (if it shows up then). When the law passed, more than 20 million people were expected to have coverage through the exchange by 2016, according to initial projections from the Congressional Budget Office.

On Friday, the administration said it wasn’t ready to comment on whether the 10 million projection will be revised. “I am still feeling concerned about low enrollment this year,” said Caroline Pearson, a senior vice president at Avalere Health. “Surely, the administration will hit its 10 million goal, but I am not sure enrollment will be a lot higher. Those who aren’t insured at that point — and aren’t eligible for a hardship exemption — will owe tax penalty in April 2017 that is $695 per person to a maximum of $2,085 per household or 2.5% of income, whichever is higher.

For a little while after the website righted itself and enrollment picked up, liberal pundits had fun mocking the G.O.P.’s predictions of disaster, and began talking as though Obama’s legacy was established, the law’s success foreordained. The provision restricts Obamacare’s “risk corridors,” which give money to insurers who are losing money because they have too many sick people on their rolls. Kevin Counihan, CEO of Healthcare.gov, credits the surge with people’s desire to have insurance, but also how affordable they are finding plans if they receive tax credits, which about 80% of people do. There was a rush of customers in recent weeks, prompting the administration to extend by two days the Dec. 15 deadline for consumers to sign up for coverage that starts in the New Year.

Not in a catastrophic way — the law has knocked down the U.S. uninsured rate to about 11-12 percent, compared to a pre-Great Recession level of 14-15 percent. Asked Friday if the number of current sign-ups has led officials to raise their enrollment target, Slavitt said, that the information is “too new” and “too fresh” to make such an adjustment. But depending on how you cut the numbers, it looks like the Obamacare exchanges will fall at least four million enrollees short of the target for 2016. The administration’s original modest goal was an acknowledgment of the tough job it faces in wooing people who have so far held off from getting insurance.

He noted that health officials are “targeting a tougher segment of the population to attract,” a reference to the 10.5 million or so eligible uninsured people, many of whom are low income and have little familiarity with buying and using health insurance. Moreover, the people who are enrolling are sicker and more heavily-subsidized than either the White House or the participating insurers had hoped; the healthy uninsured are often choosing to pay the fine (sorry, Chief Justice Roberts, I mean tax) and go without coverage. About half of the two million callers had to leave their names to be called back and Slavitt said call center employees had attempted to reach all of them by now. Employers also haven’t stopped offering coverage, as opponents of the law had expected, which would have led to more demand for plans on the exchange. About 7 out of 10 returning customers, officials have said, would be able to enroll in health plans that would cost them $75 or less after those subsidies are factored in.

People who don’t have health coverage next year are subject to a potential Obamacare penalty, which is the higher of $695 per adult, or 2.5 percent of household income. But congressional Democrats seem to have already lost the stomach for policies that were supposed to not only pay for the law, but bend the wider health care system toward sustainability. But the waits were getting kind of long, and on the telephone helpline, which is very popular, the waits were as long as 22 minutes earlier this week. As Yuval Levin pointed out for National Review last week, that’s one clear takeaway from the omnibus spending bill that both parties just negotiated.

The bill delays not only Obamacare’s medical-device tax, much hated by industry lobbyists, but also the so-called “Cadillac Tax” on high-cost insurance plans, which was crucial to the health care law’s ambitions to be a deficit-reducing, cost-bending success. One of the government officials who was talking about this today said that they would’ve needed 72,000 people answering the phones to make the waits at the normal amount, you know, just to answer when people called, and that’s why they had to extend the deadline.

When Obamacare first passed, many conservatives expressed skepticism that its “taxes to be implemented later” would actually be implemented; now we have evidence that they were right. Obamacare’s lower-than-expected enrollment, for instance, means that the law’s subsidies will cost less than anticipated, so the postponed pay-fors won’t hurt the budget quite as much.

You know, something like Amazon, they would’ve been able to handle the volume, which was, you know, in the 150,000 to 200,000 people shopping at one time range. So despite their problems, the exchanges could stagger along for quite a while as a kind of high-premium high-risk pool attached to our shrinking employer-based and expanding single-payer (Medicare and Medicaid) systems. Which would let both sides claim a modest sort of vindication: Liberals because many of the most sympathetic cases will have access to insurance, conservatives because everyone else’s costs will have risen and the larger system’s underlying problems will linger unaddressed. But that plan won’t go into effect until March, and they may face a penalty for missing those two months if they have no insurance for January and February. So what it’s going to do is expand the budget deficit, but in addition it opens up the law for criticism by saying yes, this law is costing taxpayers a lot of money because there are no pay-fors.

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