What We Still Don’t Know About Obamacare

Big gaps in enrollment data make it harder to judge the law’s success.

National Journal
Sam Baker
Jan. 14, 2014, 8:03 a.m.

We still don’t know how well Obama­care is work­ing.

There’s a lot we do know. We know that about 2.1 mil­lion people have signed up for private in­sur­ance through the health care law’s ex­changes and that about 25 per­cent of them are young adults. And we know that nearly 2 mil­lion more people have been deemed eli­gible for Medi­caid.

So, the Af­ford­able Care Act is def­in­itely get­ting people covered, and en­roll­ment is im­prov­ing by leaps and bounds. But there are still sev­er­al big, open ques­tions — and when the open-en­roll­ment peri­od closes, it will be im­possible to eval­u­ate the law’s first year without an­swer­ing them.

How many un­in­sured people are get­ting covered?

Re­mem­ber the whole up­roar over can­celed in­sur­ance plans in the in­di­vidu­al mar­ket? Those people — we nev­er got a sol­id count, but it was in the mil­lions — mostly moved in­to Obama­care’s ex­changes, along with people who were un­in­sured.

So, 2.1 mil­lion people have se­lec­ted a plan, but how many were pre­vi­ously un­in­sured, and how many are simply buy­ing a new plan be­cause their old one was can­celed?

The Af­ford­able Care Act wasn’t de­signed to simply cov­er mil­lions of people. It was de­signed to re­duce the num­ber of un­in­sured by mil­lions of people (14 mil­lion in the first year, ac­cord­ing to the Con­gres­sion­al Budget Of­fice). To know wheth­er the law is meet­ing that goal, we’ll have to know how many en­rollees were pre­vi­ously un­in­sured.

The Health and Hu­man Ser­vices De­part­ment hasn’t re­leased that in­form­a­tion for the 36 states where it is run­ning the in­sur­ance ex­changes, al­though of­fi­cials said they’ll try to have that an­swer at some point.

In New York, only about 45 per­cent of people who have en­rolled so far were pre­vi­ously un­in­sured, mean­ing that more than half of the state’s en­rollees were chan­ging their cov­er­age, rather than gain­ing it.

How many people ac­tu­ally have cov­er­age?

HHS defines a per­son as “en­rolled” once they’ve gone through the ap­plic­a­tion pro­cess, been ap­proved, shopped, and se­lec­ted an in­sur­ance policy. But con­sumers aren’t truly en­rolled — they don’t have in­sur­ance they can use — un­til they pay their first month’s premi­um. And we don’t know how many people have done that.

Es­pe­cially in the early days of en­roll­ment, HHS’s defin­i­tion made sense: Who would pay a premi­um in Oc­to­ber that wasn’t due un­til Decem­ber, for cov­er­age that didn’t start un­til Janu­ary? HHS says it’s still us­ing the same defin­i­tion be­cause people won’t pay their premi­um un­til it’s due.

Even so, you’re not covered un­til you pay your first premi­um. So, the 2.1 mil­lion people who have picked a plan might not all have cov­er­age. That doesn’t change the en­roll­ment trend line; as one meas­ure of en­roll­ment rises, the oth­er does too. Pre­sum­ably, most people who pick plans go on to pay the premi­ums for those plans.

Still, to ul­ti­mately know how many people truly gained health in­sur­ance through Obama­care, we’ll need to know how many people went all the way through the pro­cess.

Are healthy people sign­ing up?

There’s been an in­tense fo­cus on the num­ber of young people who are sign­ing up for cov­er­age (about 25 per­cent so far, which is not amaz­ing but not ter­rible). That’s not be­cause young people are in­her­ently more de­sir­able cus­tom­ers; it’s be­cause age is a rough stand-in for health status.

Get­ting healthy people in­to the sys­tem is the key to avoid­ing ma­jor premi­um hikes next year. But no one really knows how healthy en­rollees are, so age is used in­stead as a ba­ro­met­er. A 25-year-old is stat­ist­ic­ally more likely to be healthy than a 50-year-old. But, of course, there are ex­cep­tions. En­rolling a huge num­ber of young people won’t ac­tu­ally keep premi­ums low if they all turn out to be sick.

Be­cause it’s no longer leg­al for in­surers to charge high­er premi­ums be­cause of a preex­ist­ing con­di­tion, the ap­plic­a­tion for Obama­care cov­er­age doesn’t ask about pre­vi­ous health is­sues. So we won’t know the break­down of healthy versus sick for a long time — not un­til people start fil­ing claims and in­surers get a sense of their costs. Un­til then, age is the only guide, flawed as it is.

How many uninsured people are getting covered?

Re­mem­ber the whole up­roar over can­celed in­sur­ance plans in the in­di­vidu­al mar­ket? Those people — we nev­er got a sol­id count, but it was in the mil­lions — mostly moved in­to Obama­care’s ex­changes, along with people who were un­in­sured.

So, 2.1 mil­lion people have se­lec­ted a plan, but how many were pre­vi­ously un­in­sured, and how many are simply buy­ing a new plan be­cause their old one was can­celed?

The Af­ford­able Care Act wasn’t de­signed to simply cov­er mil­lions of people. It was de­signed to re­duce the num­ber of un­in­sured by mil­lions of people (14 mil­lion in the first year, ac­cord­ing to the Con­gres­sion­al Budget Of­fice). To know wheth­er the law is meet­ing that goal, we’ll have to know how many en­rollees were pre­vi­ously un­in­sured.

The Health and Hu­man Ser­vices De­part­ment hasn’t re­leased that in­form­a­tion for the 36 states where it is run­ning the in­sur­ance ex­changes, al­though of­fi­cials said they’ll try to have that an­swer at some point.

In New York, only about 45 per­cent of people who have en­rolled so far were pre­vi­ously un­in­sured, mean­ing that more than half of the state’s en­rollees were chan­ging their cov­er­age, rather than gain­ing it.

How many people actually have coverage?

HHS defines a per­son as “en­rolled” once they’ve gone through the ap­plic­a­tion pro­cess, been ap­proved, shopped, and se­lec­ted an in­sur­ance policy. But con­sumers aren’t truly en­rolled — they don’t have in­sur­ance they can use — un­til they pay their first month’s premi­um. And we don’t know how many people have done that.

Es­pe­cially in the early days of en­roll­ment, HHS’s defin­i­tion made sense: Who would pay a premi­um in Oc­to­ber that wasn’t due un­til Decem­ber, for cov­er­age that didn’t start un­til Janu­ary? HHS says it’s still us­ing the same defin­i­tion be­cause people won’t pay their premi­um un­til it’s due.

Even so, you’re not covered un­til you pay your first premi­um. So, the 2.1 mil­lion people who have picked a plan might not all have cov­er­age. That doesn’t change the en­roll­ment trend line; as one meas­ure of en­roll­ment rises, the oth­er does too. Pre­sum­ably, most people who pick plans go on to pay the premi­ums for those plans.

Still, to ul­ti­mately know how many people truly gained health in­sur­ance through Obama­care, we’ll need to know how many people went all the way through the pro­cess.

Are healthy people signing up?

There’s been an in­tense fo­cus on the num­ber of young people who are sign­ing up for cov­er­age (about 25 per­cent so far, which is not amaz­ing but not ter­rible). That’s not be­cause young people are in­her­ently more de­sir­able cus­tom­ers; it’s be­cause age is a rough stand-in for health status.

Get­ting healthy people in­to the sys­tem is the key to avoid­ing ma­jor premi­um hikes next year. But no one really knows how healthy en­rollees are, so age is used in­stead as a ba­ro­met­er. A 25-year-old is stat­ist­ic­ally more likely to be healthy than a 50-year-old. But, of course, there are ex­cep­tions. En­rolling a huge num­ber of young people won’t ac­tu­ally keep premi­ums low if they all turn out to be sick.

Be­cause it’s no longer leg­al for in­surers to charge high­er premi­ums be­cause of a preex­ist­ing con­di­tion, the ap­plic­a­tion for Obama­care cov­er­age doesn’t ask about pre­vi­ous health is­sues. So we won’t know the break­down of healthy versus sick for a long time — not un­til people start fil­ing claims and in­surers get a sense of their costs. Un­til then, age is the only guide, flawed as it is.

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