Over­loads arise as 34 states use one ex­change site Cu­rios­ity may ex­plain heavy Web traf­fic

The Washington Times Weekly - - National - BY TOM HOW­ELL JR.

The Obama ad­min­is­tra­tion’s health care roll­out may have been rock­ier than ex­pected this week be­cause so many states re­fused to co­op­er­ate, leav­ing the fed­eral gov­ern­ment to run far more ex­changes than ini­tially planned, ac­cord­ing to an­a­lysts study­ing the Af­ford­able Care Act.

And the in­tense in­ter­est from re­searchers, jour­nal­ists and mar­ket an­a­lysts ac­tu­ally may be pre­vent­ing some cus­tomers from be­ing able to ac­cess the web­sites set up to help con­sumers nav­i­gate the health ex­changes.

“Ev­ery insurance com­pany in the coun­try wants to know what ev­ery­one else is do­ing,” said Dan Men­del­son, CEO of Avalere Health, a Wash­ing­ton­based ad­vi­sory com­pany.

Three days af­ter the ex­changes went live, re­ports con­tin­ued to sur­face of ma­jor in­ter­est from po­ten­tial cus­tomers, but also of tech­ni­cal glitches the fed­eral gov­ern­ment said it was work­ing to cor­rect.

As writ­ten, the Af­ford­able Care Act al­lows states to choose whether to set up their own ex­changes or have the fed­eral gov­ern­ment do it for them.

Congress and the ad­min­is­tra­tion had an­tic­i­pated most states would want to craft the mar­ket to their res­i­dents’ needs. But that didn’t hap­pen. In­stead, 34 states opted to let the fed­eral gov­ern­ment run all or part of their ex­changes, fun­nel­ing res­i­dents of those states to one fed­eral web­site.

That site, Health­Care.gov, sent visi­tors to a “hold­ing page” mes­sage due to heavy vol­ume. The por­tal is sup­posed to let users with­out em­ployer cov­er­age ap­ply and shop for cov­er­age — of­ten with the help of in­come-based sub­si­dies — or di­rect users to state-run ex­changes in 16 states and the Dis­trict of Columbia.

Mean­while, state-run ex­changes have re­ported suc­cess sto­ries.

“The state sites are up and run­ning,” Mr. Men­del­son said.

Visi­tors to Ken­tucky’s ex­change, Kynect, had started 11,000 ap­pli­ca­tions for cov­er­age as of Wed­nes­day. Of­fi­cials at­trib­uted its rel­a­tive suc­cess to keep­ing all op­er­a­tions within one agency and its long-stand­ing in­fra­struc­ture.

“We were able to in­cor­po­rate IT re­sources we al­ready had within our state, and also de­signed the sys­tem to al­low us to scale up or down in terms of pro­cess­ing power with­out hav­ing to take the site off-line,” Kynect spokes­woman Gwenda Bond said.

Ken­tucky is no­table, be­cause it is the only state in the South that de­cided to set up its own ex­change.

Many of the states that de­ferred re­spon­si­bil­ity for the ex­change to Wash­ing­ton were led by Repub­li­can gover­nors or law­mak­ers, who, af­ter the de­feat of GOP pres­i­den­tial nom­i­nee Mitt Rom­ney in Novem­ber, de­cided to let the Obama ad­min­is­tra­tion ac­cept the re­spon­si­bil­ity or po­ten­tial fall­out from set­ting up Oba­macare.

The is­sue has pro­duced un­in­tended con­se­quences, in­clud­ing po­lit­i­cal de­bate and law­suits over lan­guage in the law that sug­gests gov­ern­ment sub­si­dies should only go to con­sumers who use an ex­change es­tab­lished by a state.

Jonathan Gru­ber, an MIT pro­fes­sor who worked on Mas­sachusetts’ pi­o­neer­ing health care re­forms be­fore help­ing the Obama ad­min­is­tra­tion, said the state-based de­ci­sions might have con­trib­uted to the over­whelmed fed­eral web­site.

“On the other hand, if th­ese states had done it them­selves with­out be­ing fully in­vested, they prob­a­bly would have done a bad job and that could be even worse,” he said.

Mr. Men­del­son said the fed­eral gov­ern­ment also might have un­der­es­ti­mated the num­ber of in­ter­ested par­ties who drove up Web traf­fic be­cause they want to check out the new pro­gram.

The Depart­ment of Health and Hu­man Ser­vices said its sys­tem works and ca­pac­ity is im­prov­ing by the hour, but it has not re­leased any fig­ures on en­roll­ment to back up its as­ser­tions that mil­lions are flock­ing to the sites be­cause they are hun­gry to en­roll in cov­er­age.

That makes it dif­fi­cult to parse ac­tual cus­tomers from in­ter­ested par­ties who sim­ply wanted to click around the en­roll­ment web­site.

“The de­mand here is be­cause peo­ple want to un­der­stand the mar­ket­place,” Mr. Men­del­son said.

“Ev­ery insurance com­pany in the coun­try wants to know what ev­ery­one else is do­ing.”


Jonathan Gru­ber, pro­fes­sor of eco­nom­ics at the Mas­sachusetts In­sti­tute of Tech­nol­ogy, said de­ci­sions by states on the level of par­tic­i­pa­tion with Oba­macare may have con­trib­uted to the fed­eral web­site be­ing over­whelmed dur­ing this week’s roll­out.

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