8 mil­lion en­roll­ment to­tal tops good-news week for Oba­macare

Modern Healthcare - - NEWS - By Paul Demko

Higher-than-ex­pected en­roll­ment, lower-than-ex­pected pre­mi­ums and sub­sidy costs, and in­creased in­ter­est from in­sur­ers made last week a good one for Oba­macare, leav­ing Repub­li­can crit­ics scram­bling to fig­ure out how to re­spond.

Pres­i­dent Barack Obama an­nounced on Thurs­day that 8 mil­lion Amer­i­cans had signed up for pri­vate health plans on the federal and state in­sur­ance ex­changes by the end of ex­tended open en­roll­ment April 15. “This thing is work­ing,” Obama said at the White House. “We now know for a fact that re­peal­ing the Af­ford­able Care Act would in­crease the deficit, raise pre­mi­ums for mil­lions of Amer­i­cans and take in­sur­ance away from mil­lions more.”

In ad­di­tion, the Con­gres­sional Budget Of­fice last week low­ered its 10-year cost es­ti­mate for the Pa­tient Pro­tec­tion and Af­ford­able Care Act by more than $100 bil­lion. The main rea­son is it ex­pects pre­mi­ums to be 15% lower in 2016 than pre­vi­ously pro­jected, mean­ing the govern­ment will spend less on pre­mium sub­si­dies. The CBO said the lower pre­mi­ums re­sult from in­sur­ers of­fer­ing ex­change plans with nar­rower provider net­works and more re­stric­tions on care than are typ­i­cal of the em­ployer-based mar­ket.

The CBO also es­ti­mated that 5 mil­lion Amer­i­cans signed up for in­di­vid­ual­mar­ket in­sur­ance for 2014 out­side the Oba­macare ex­changes.

In other good news for Obama, re­search by the So­ci­ety of Ac­tu­ar­ies sug­gested that 2015 pre­mi­ums for ex­change plans will likely in­crease by 6% to 8.5%, well be­low the dou­ble-digit hikes some ex­perts have warned about and more in line with rate in­creases in re­cent years.

There’s also mount­ing ev­i­dence that in­sur­ers are be­com­ing more bullish on the ex­change mar­kets. Two of the largest pub­licly traded in­sur­ers— unit­edhealth Group and Cigna Corp.— in­di­cated that they ex­pect to com­pete more ag­gres­sively in the ex­changes in 2015 af­ter tak­ing a con­ser­va­tive ap­proach this year. “We do have a bias to in­crease that par­tic­i­pa­tion in 2015,” Gail Boudreaux, ex­ec­u­tive vice pres­i­dent of United Health Group, said dur­ing a call

We now know for a fact that re­peal­ing the Af­ford­able Care Act would in­crease the deficit, raise pre­mi­ums for mil­lions of Amer­i­cans and take in­sur­ance way from mil­lions more.”

—Pres­i­dent Barack Obama

with in­vestors Thurs­day.

The 8 mil­lion sign-up fig­ure ex­ceeded even the most op­ti­mistic projections. “It’s a huge num­ber, es­pe­cially af­ter that re­ally rocky, dis­as­trous roll­out,” said Sab­rina Cor­lette, a pro­fes­sor at Ge­orge­town Univer­sity’s Cen­ter on Health In­sur­ance Re­forms. “It’s just in­dica­tive of the need that’s out there.”

Con­gres­sional Repub­li­cans chal­lenged the fig­ure, say­ing it’s still un­known how many of those people will com­plete the en­roll­ment process by pay­ing their first pre­mium. They also crit­i­cized the up­heaval that the law has caused in the mar­ket. They have con­tin­ued call­ing for re­peal of the ACA.

“Count­less Amer­i­cans have un­ex­pect­edly been forced out of the plans they had and liked, are now shoul­der­ing dra­mat­i­cally higher pre­mi­ums, and can no longer use the doc­tors and hos­pi­tals they choose,” Se­nate Mi­nor­ity Leader Mitch McCon­nell (RKy.) said in a writ­ten state­ment.

Be­yond the fi­nal sign-up to­tal, in­sur­ers liked that en­rollees skewed younger dur­ing the fi­nal weeks of en­roll­ment, with 28% of those sign­ing up for ex­change plans ages 18 to 34. That was up from 25% at the end of Fe­bru­ary. Though it’s still be­low the 35% to 40% that ex­perts say is ideal for a bal­anced risk pool, some in­sur­ers have in­di­cated it’s about what they ex­pected and they set their 2014 pre­mi­ums ac­cord­ingly.

In­sur­ers and of­fi­cials in at least 10 states, in­clud­ing Cal­i­for­nia and Michi­gan, said they ex­pect at least one more com­peti­tor in their ex­change mar­ket­places for 2015.

The Obama ad­min­is­tra­tion has not re­leased data on how many of the new en­rollees were pre­vi­ously unin­sured. In ad­di­tion, there’s no way to know how many people will con­tinue pay­ing their pre­mi­ums through­out the year, though many in the in­di­vid­ual mar­ket tra­di­tion­ally come and go as they lose and gain job­based cov­er­age.

The ad­min­is­tra­tion still hasn’t fin­ished build­ing the back-end sys­tem needed to ver­ify en­roll­ment data and make sure in­sur­ers get ac­cu­rate pay­ments. With­out that, it’s hard for the ad­min­is­tra­tion to back up its en­roll­ment fig­ures, said Stephen Par­ente, a health­care pol­icy ex­pert at the Univer­sity of Min­nesota who ad­vised Sen. John McCain’s 2008 pres­i­den­tial cam­paign.

Still, some ob­servers say Oba­macare’s en­roll­ment turn­around af­ter the botched roll­out last fall puts Democrats in a stronger po­si­tion for the Novem­ber con­gres­sional elec­tions. “Repub­li­cans are prob­a­bly putting too many eggs in the health­care re­peal bas­ket,” said Ja­cob Hacker, a po­lit­i­cal sci­ence pro­fes­sor at Yale Univer­sity. “The ship is launched, and it’s ac­tu­ally float­ing. That changes the pol­i­tics a lot.”

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