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Obamacare Sign-Ups Going Badly

January 16, 2014

Long before HealthCare.gov’s disastrous rollout, internal Health and Human Services (HHS) projections pegged Obamacare’s enrollment target at 3.3 million people by December 31, 2013. Just one day before HealthCare.gov went live, however, HHS Secretary Kathleen Sebelius upped the ante. She set seven million sign-ups by the end of March – including 2.7 million young, healthy adults – as what “success looks like.”

This week, HHS issued a report updating its cumulative enrollment figures to include December data. The Administration claims nearly 2.2 million people have signed up in the exchanges so far; 1.788 million of them in December. Clearly the Obama Administration failed to hit its target. So, what do we know? The report does, for the first time, provide some very limited demographic information critical to determine if the current risk pool is balanced or not. The data should be read skeptically.

Exchange Sign-Ups Are Trending Older and Sicker. This week HHS revealed that only 24 percent of the Obamacare exchange sign-ups – approximately 528,000 – were young people between the ages of 18 and 34. The Administration desperately needs younger, healthier people to sign up in order for its law to work. The Administration estimated it needs young adults to comprise at least 39 percent of the Obamacare risk pool. According to the HHS analysis, adults ages 45 to 64 currently account for 55 percent of total sign-ups. People ages 55 to 64 are the largest group: 33 percent of total sign-ups. If this demographic composition continues through the end of the March 31 open enrollment period or beyond, premiums will likely skyrocket.

How Many People Paid Their First Month’s Premium? The Obama Administration’s report still doesn’t provide transparent enrollment data. It continues to count people as “enrolled” in Obamacare if they successfully selected a health insurance plan, but it is unclear exactly how the Administration defines “selected a plan.” Are these people who completed the application, chose a plan, and paid the first month’s premium? Or are they people who completed the application, chose a plan and put that plan in an online shopping cart, but have yet to pay the premium? Until people pay the first month’s health insurance premium, they do not have coverage.

Additionally, the Administration continues to boast that six million people gained health insurance coverage due to Obamacare. This figure is misleading. So far, HHS hasn't addressed how many people truly are newly insured – rather than simply renewing Medicaid coverage or switching from one private insurance plan to another.

HHS Touts Unrelated Data to Deflect Tough Questions. The Administration is working very hard to push the reset button on its internal metrics designed to evaluate if the program is working or not. For example, the Administration’s report continues to tout the total number of visits the website generates. HHS proudly announced both the state and federal exchanges garnered 53.2 million site visitors. But there is a big difference between the total number of site visits and the total number of people enrolling in a health care plan. The Administration’s data imply that most people visiting HealthCare.gov may not actually be applying for insurance, but simply looking for basic information.

Monthly Reporting Tallies Still Contain Duplicates. The HHS report concedes that some state exchanges continue working to correct data problems that may have resulted in HHS double counting certain signups. This is not an insignificant figure. Approximately 44 percent of Obamacare’s total signups are derived from the 15 state-based exchanges. HHS claims that HealthCare.gov’s signup data does not contain duplicates.

Health Care Headlines

National Journal: “White House Moves Obamacare Goalposts Again” The White House is scaling back another self-imposed standard for Obamacare's success – and it's one the administration has spent months promoting. White House officials consistently – and accurately – argue that the most important metric for Obamacare's success this year is the mix of young and old enrollees. But they're backing away from their own goals for that mix. Getting young people into the system is critical to holding down premiums, and therefore to keeping each state's insurance market stable. Administration officials previously said their target was for young adults to make up about 38 percent of Obamacare enrollees. Now that standard is down to about 30 percent. Or maybe even 24 percent – where the mix stands now.

Washington Post: The Fact Checker: “Warning: Ignore claims that 3.9 million people signed up for Medicaid because of Obamacare” There is much less to the Medicaid figure than meets the eye. Indeed, there has been vast confusion about what this figure means, especially in the news media. The Fact Checker cited the 3.9 million figure in a few recent columns, but prodded by an interesting analysis by Sean Trende at Real Clear Politics, we decided to take a closer look. Bottom line: This number tells you almost nothing about how the Affordable Care Act is affecting Medicaid enrollment. Reporters need to stop using it.

The Hill: “Dozens more O-Care regs coming in 2014” The Obama Administration is busy drafting more than 50 additional regulations required by the Affordable Care Act, a new government report finds. The Congressional Research Service identified some 43 proposed and final rules related to the landmark healthcare law that are now under construction at various agencies and are on track to be issued within the next 12 months.

Kaiser Health News: “HHS Extends Coverage For Patients In Federal High-Risk Pools” The tens of thousands of people with a history of serious illnesses who are enrolled in high-risk insurance pools created under the health care law will have an additional two months – until March 31 – before they lose that coverage, HHS announced Tuesday.

New York Times: “Older Pool of Health Care Enrollees Stirs Fears on Cost” People signing up for health insurance through the Affordable Care Act’s federal and state marketplaces tend to be older and potentially less healthy, officials said Monday, a demographic mix that could threaten the law’s underpinnings and cause premiums to rise in the future if the pattern persists.

CNN Money: “Health care job losses for first time in decade” Health care companies shed 6,000 positions in December, the first down month since July 2003, according to the government's monthly jobs report. This comes after a yearlong slowdown in hiring.

Washington Post: “Second wave of health-insurance disruption affects small businesses” When millions of health-insurance plans were canceled last fall, the Obama administration tried to be reassuring, saying the terminations affected only the small minority of Americans who bought individual policies. But according to industry analysts, insurers and state regulators, the disruption will be far greater, potentially affecting millions of people who receive insurance through small employers by the end of 2014.