People Profit Power - Healthcare & Insurance

Obamacare: A Midterm Report Card

by Charles Ornstein ProPublica, Jan. 14, 2014, 11:01 a.m.

The first half of the Obamacare open enrollment period is over, and yesterday, federal health officials announced sign-up figures from the first three months.

After a disastrous start, HealthCare.gov (which handles enrollment for 36 states) began functioning properly. It, along with state-run insurance exchanges, netted more than 2.1 million signups between Oct. 1 and Dec. 28.

But are sign-ups on pace to meet the Congressional Budget Office's projection of 7 million this year? And is there an adequate balance between young and old, sick and healthy, to keep costs in line? That's harder to say.

Here's what we know:

• Some states are performing much better than others. Connecticut has already exceeded the target the Centers for Medicare and Medicaid Services (CMS) wanted it to have by the end of March, according to acasignups.net. New York and Rhode Island are also on pace to beat expectations. But other states are lagging. They include Maryland, Oregon and Massachusetts, which run their own exchanges and continue to be plagued by website problems. Also far behind are New Mexico and Mississippi, which rely on HealthCare.gov.
• Enrollees are skewing older. Currently, 33 percent of enrollees are 55 to 64 years old, compared to only 30 percent who are under 35. In Arkansas, Maine, Ohio, West Virginia and Wisconsin, at least 40 percent of enrollees are over 55. A higher proportion of younger enrollees are going to have to sign up before the end of March in order to help offset the costs of older ones. CMS officials say younger enrollees tend to sign up later in the process, as they did several years ago when Massachusetts implemented its individual mandate.
• The vast majority of those signing up qualify for financial assistance. About 79 percent of the early sign-ups will receive financial assistance, just a bit less than what the Congressional Budget Office estimated (86 percent 2013 see page 3). That ranges from an implausible low of 9 percent in Washington D.C., to 100 percent in Oregon.

Here's what we don't know:

• How many of those who signed up for coverage previously had plans canceled by insurance companies If the policies are merely replacing coverage that individuals already had, the law won't make the dent in the uninsured that proponents hoped for. In New York, for example, only 44 percent of the early enrollees had been uninsured.
• The health status of early enrollees. While some people consider age a proxy for health status, in truth, it isn't a very effective stand-in. Experts say they need to know more about the health of those who enrolled to know if the insurance risk pool will be balanced, keeping premiums from exploding in the years to come. Health insurer Humana reported last week that the mix of its early enrollees was "more adverse than previously expected," in part because the Obama administration gave those with canceled policies the ability to stay in them for another year. That assumes those who chose to stay were healthier than others.
• Whether enrollees have paid their first month's bill. Coverage does not take effect unless consumers pay their initial bill. There has been plenty of confusion about the deadline to sign up 2013 and confusion about when the first payment is due. Dates have changed and vary from state to state, insurer to insurer. Some insurers set a deadline of Jan. 10; others have set other dates in January for coverage that began Jan. 1. "It's been pulling teeth," Shaun Greene, chief operating officer of Utah-based Arches Health Plan, told the Wall Street Journal. The newspaper reported that, as of Thursday, Arches had collected about 60 percent of premiums for people who signed up for coverage that took effect Jan. 1.
• How many people have signed up for coverage outside of the exchanges. In order to receive a premium tax credit to offset the monthly cost of coverage, individuals have to sign up using one of the health exchanges created under the law. But those who do not qualify or don't want to bother can sign up directly with an insurance company. Ultimately, those figures will be publicly reported, but that will take months, or even years.
• Will the open-enrollment period close strong as it did in Massachusetts? Supporters of the Affordable Care Act regularly point to the experience of Massachusetts, which implemented a similar individual mandate in 2007, and saw a late surge of enrollment, particularly among the young. The open enrollment period for Obamacare runs through March 31, leaving plenty of time for folks to sign up.

Editor's Note: This post is adapted from Ornstein's "Healthy buzz" blog. Have you tried signing up for health care coverage through the new exchanges? Help us cover the Affordable Care Act by sharing your insurance story.