On Wednesday, the Department of Health and Human Services released the first official numbers on how many Americans chose a plan under President Obama's health care law. Here are important things to keep in mind.
1. The headline number (106,185) is for people who went through the signup process on one of the the government health insurance exchanges and chose a plan between the Oct. 1 launch and Nov. 2. But this doesn’t mean that they necessarily paid for the plan, which is the traditional way of defining enrollment.
HHS’ way of measuring enrollment was undermined earlier Wednesday when Obama’s chief technology officer, Todd Park, conceded under questioning before the House Oversight and Government Reform Committee that if he went to amazon.com and put a product in a shopping cart without paying, it wouldn’t count as a sale.
In a conference call held in conjunction with the release of the numbers, HHS Secretary Kathleen Sebelius emphasized that Americans had until Dec. 15 to pay for plans beginning on Jan. 1.
That’s fair to note, especially given that lower-income Americans signing up for coverage may not have the money to pay for it months in advance. But it’s also possible that a certain number of people could decide later that they don’t want to purchase insurance.
The bottom line is that the 106,185 number is not synonymous with actual enrollments, though the enrollment number is likely to be higher than the number of those who have fully completed the process and paid at this point.
Sebelius said that HHS had no plans to release a breakdown of how many actually paid.
2. It’s true, as many have pointed out, that the raw number of enrollees matters less than the composition of the risk pool. What’s most important is that the program attracts a critical mass of young and healthy individuals — estimated by the administration at 40 percent — to offset the costs of covering older and sicker Americans, particularly those with pre-existing conditions.
That having been said, size still is important, because it’s harder to get the right mix of healthy and sick beneficiaries without a sufficient number of people to work with. In other words, super-low enrollment implies a bad risk pool.
It's also important to remember that for the program to be truly viable, exchanges not only have to hit that critical mass nationally, but each individual state must have the right balance of enrollees. If 40 percent of the enrollees are young and healthy nationwide, but they are concentrated in a small number of states, then the individual market could still collapse in the others.
According to HHS, about 52,000 people signing up for plans — or nearly half the national total — came from New York and California. By contrast, Texas, Florida and Illinois (which have roughly the same population when combined) had fewer than 8,000 signups. South Dakota and North Dakota had 58 and 42, respectively.
Persistent technology problems plaguing the Obamacare signup process has created further concern that the only individuals willing to go through the arduous process of buying insurance thus far are likely to be older and sicker participants and those with pre-existing conditions.
Sebelius did nothing to dispel that concern, explaining that HHS had no current plans to release a demographic breakdown because officials wanted to make sure that only accurate data was released.
3. Administration officials from Obama on down have repeatedly emphasized that Obamacare’s enrollment period lasts six months, until March 31. Sebelius did so again, recalling that when Massachusetts launched its similar health care program in 2007, enrollment was merely a trickle in the first month.
To start, the signup period in Massachusetts lasted nearly a year. But beyond that, the problem with that argument is that HHS officials knew about the history of enrollment in Massachusetts -- and the tendency of insurance sign-ups to start slow and pick up -- yet still predicted that 500,000 would sign up in October and 3.3 million by the end of December.
The Congressional Budget Office estimated 7 million would enroll in a plan through the exchange by the end of open enrollment.
4. Another interesting point in the conference call came when Sebelius emphasized that individuals who do not qualify for government subsidies could enroll in plans directly through insurers. The fact that she was mentioning this alternative path suggests flagging confidence that the exchanges would be fully functional by the end of the month
Sebelius even started to climb down from the oft-repeated vow that the site would be functioning smoothly for a vast majority of users by Nov. 30, first made by Jeffrey Zients, the former acting director of the Office of Management and Budget who was brought in to oversee the process of fixing technology problems.
“When Jeff Zients made the statement about the vast majority of people, he recognized the fact that first of all, there would always be outlier cases,” she said.
She argued that the site is much better than it was last month, and would continue to improve.
At the oversight hearing, technology officer Park also was also careful about the Nov. 30 date. He repeatedly said that it was the goal to make the system run smoothly for the “vast majority” of Americans by that time and that everybody was working hard to meet that goal. But he didn’t emphatically say they would.
The reason why that date is important is that the administration and insurers are counting on a huge spike in enrollments after Thanksgiving because there is a Dec. 15 deadline for Americans to enroll in a plan if they want to be covered at the start of next year.
This problem is further compounded by the fact that millions of Americans are losing their current insurance coverage due to new regulations imposed by Obamacare, despite the president’s promise that people could keep their insurance if they liked it.