Federal Health-Insurance Exchanges See Nearly Six Million Apply for 2016 Coverage

23 Dec 2015 | Author: | No comments yet »

Big surge in enrollment lifts Obamacare marketplaces.

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.A big surge of consumers this fall is pushing up enrollment in health coverage offered through the Affordable Care Act, providing an unexpected boost to insurance marketplaces created by the law, according to new data from the federal government. 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 strong demand for Obamacare coverage in the law’s third enrollment period may further solidify the markets, which are still evolving as insurance companies and consumers continue to adapt to the new healthcare environment. The new surge also comes as the law’s defenders face renewed attacks amid the exit of several new insurers from marketplaces around the country and the recent budget deal that will delay several funding sources in the law. “The marketplace is demonstrating not only growth, but that it remains vibrant and strong,” said Kevin Counihan, who oversees the markets at the Department of Health and Human Services. “That is a very important sign for the road ahead.” Thus far, 2.4 million of the nearly 6 million HealthCare.gov enrollees have been new to the marketplace, more than a third more than signed up at this point last year, according to HHS officials. This good news for proponents of the health-care law prompted the Obama administration to catapult it from what are normally routine announcements by federal health officials to the opening of a presidential press conference. 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. They granted a 48-hour extension to the original Dec. 15 deadline for obtaining insurance for Jan. 1, saying that the volume was so great that about 1 million people had been placed in waiting lines to reach federal call centers or use the enrollment website.

Consumers making less than four times the federal poverty level – about $47,000 for a single adult or $97,000 for a family of four — qualify for subsidies. That surge occurred even though the administration recently tamped down public expectations for how many additional consumers are likely to get ACA insurance for the coming year. When the law passed, about 20 million people were expected to have coverage through the exchange by 2016, according to initial projections from the Congressional Budget Office. “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. And in recent weeks, insurers and the industry’s Washington lobbying arm, America’s Health Insurance Plans, have become increasingly vocal over their concerns about the marketplaces and the lack of healthier enrollees to balance out the sick consumers who are signing up for coverage.

HHS has forecast that one-quarter to one-third of them would enroll, which means that the 2.4 million new customers so far are already approaching that prediction. The administration’s original modest goal was an acknowledgment of the tough job they face in wooing people who have so far held off from getting insurance. 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. The common wisdom has been that attracting new customers to HealthCare.gov would be more difficult in this third year, because people still uninsured have ignored or rejected two previous opportunities to gain coverage. But federal officials speculated that consumers’ ability to find affordable options in the marketplaces, particularly with subsidies, is playing a role.

HealthCare.gov and many state marketplaces also feature new tools this year that make it easier for consumers to compare plans, look at physician directories and estimate total costs, including premiums and out-of-pocket expenses such as co-pays and deductibles. 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. 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. Analysts said lackluster enrollment that trends toward sicker and older consumers could prompt some carriers to leave the exchanges: The biggest U.S. health insurer, UnitedHealth Group Inc., UNH -2.85 % said last month that it is re-evaluating whether to sell plans on the marketplaces because of losses on policies sold on them. 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.

HHS officials have been cautioning consumers not to wait for this automatic enrollment, saying they could face spikes in insurance rates unless they shop around for the best available health plan. 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.

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