The Obamacare Exchange Scorecard
In the market for individually-purchased health insurance, more than 4.8 million Americans have received notices that their preexisting plans are soon to be illegal, and will be cancelled. Many more cancellation notices are imminent. But yesterday, the Wall Street Journal obtained information regarding the number of people who have signed up for new private health coverage under Obamacare: "40,000 to 50,000" for the federal exchange, and 49,000 for 12 of the 14 state-based exchanges.
White House falls short of target by around 80%
Last month, the Associated Press published details of an internal Obama administration memo, dated September 5, detailing the White House’s monthly targets as to how many people would sign up for private insurance under Obamacare’s exchanges. "We expect enrollment in the initial months to be low," said the September 5 memo. Through October, the administration estimated that 494,620 would sign up. They only got about a fifth of the way toward that lowball estimate.
"So far, private health plans have received enrollment data for 40,000 to 50,000 users of the federal marketplace," write Christopher Weaver, Timothy Martin, and Louise Radnofsky in the Journal. "Separately, 12 of the 14 states that are running their own exchanges have tallied roughly 49,000 enrollees."
Believe it or not, the enrollment data from the federal government may actually exaggerate the number of people who have signed up. "The number represents enrollment date sent to insurers from the marketplace," but counts "data sent to insurers from the marketplace."
One official told Amy Goldstein and Sarah Kliff of the Washington Post that "the official figure will include people who have paid for a plan and those who simply picked a plan and put it in their shopping cart." Most private companies aren’t allowed to count as "sales" people who put items in their electronic shopping carts, but haven’t yet paid. But politics triumphs economics. Goldstein and Kliff write that, "according to one person with knowledge of the figures, slightly fewer than 40,000 people had selected a [federal exchange-based] health plan as of last week."
Website unlikely to be ready by Nov. 30
Last Friday, in a briefing conducted by the Centers for Medicare and Medicaid services, officials walked back a previous commitment to get the website fixed by the end of November. "It’s a critical date, without question," said one. "But don’t think of it as an unveiling date. The goal is to make significant improvements that day."
These officials picked November 30 as their self-imposed deadline because, without it, many of the Americans seeing their preexisting plans cancelled before January 1 won’t be able to find Obamacare-compliant plans to replace them.
Juliet Eilperin and Amy Goldstein of the Washington Post report that insurers may be looking for extra subsidies in order to help the government out. "One idea circulated within the insurance industry would be for HHS to approave a method to estimate subsidies and give preliminary tax credits based on those estimates—with the accurate amount determined later, once the system works better." But "insurance industry leaders have said that they would insist on a guarantee that they would be compensated for any underpayments—and that they have asked to keep any overpayments."
Fixing the website may take six months
Based on what we’ve seen to date from the administration, it appears likely that the website will take four to six months to function properly. The Obama administration should take the advice of the Democratic chairman of the Senate Finance Committee, Max Baucus (D., Mont.) and shut the thing down until they can fix it.
But the administration appears hell-bent on keeping the exchange open, because they want to enroll as many people into Obamacare before the President’s term is up. That way, the law will become harder to repeal, even if Republicans win in 2016.
I get the political logic. But Americans are facing significant disruptions in the quality and consistency of their health coverage. It’s this very mentality that caused the Obama administration to force-launch a website that wasn’t ready for prime time. It’s important for them to get it right.
This piece originally appeared in Forbes
This piece originally appeared in Forbes