November 12 2013
The public has been trying to tell the administration and Democrats for three years now that it doesn’t like ObamaCare. And it has finally found a way to speak loud and clear in a way the administration can’t dismiss: the public isn’t buying it. Literally.
Only around three percent (40,000 people) of the administration’s projected enrollment for ObamaCare have actually signed up for the insurance program, according to news reports—and even that number reportedly is fudged a bit. It is said to include people who have not bought a plan but have simply put it in their online shopping cart.
The 40,000 figure does not include people who signed up for Medicaid. When the increased burden to Medicaid is factored into the equation, the situation becomes even more difficult. Reuters notes:
Supporters of Obamacare and health insurers fear that scant participation in the private insurance exchanges will prevent them from becoming a sustainable new individual market, including the right mix of young and healthy members to offset coverage for older, sick people.
Reason’s Peter Suderman asks how bad things can get:
The answer is...worse. A lot worse.
Suderman quotes Robert Laszewski,a well-connected insurance consultant, saying that it is unlikely that the administration can meet its deadline for making HealthCare.gov, the portal into ObamaCare, work by Dec. 1. According to Suderman, he says that months, not weeks, of work must be done. This not only makes it difficult for new people to sign up for insurance but it puts those who have lost their insurance because of ObamaCare in a frightening limbo. If you’re sick, a break in coverage could be disastrous.
As noted on this blog the other day, the administration is looking to the insurance companies it has been bashing for years to help fix the website. Insurers have floated an interim idea: since they are unable to access the federal website that calculates subsidies, why not let them estimate subsidies? Oh, and, if they get it wrong, they get to keep the extra money. Hey, it’s only taxpayer money.
Can this possibly be legal? Can the administration seriously be considering this idea, which is potentially costly and politically disastrous? Imagine how Democrats will feel about turning over the central operations of the health law to insurers. Imagine how Republicans will react to a plan that could cost more, and will serve as an implicit admission that the exchanges simply won’t work without a major overhaul.
That it is even being discussed suggests how dire the outlook is for the law’s near-term functionality. As the Post piece notes, the administration’s broad cooperation with insurers “is a tacit acknowledgment that the federal insurance exchange… might not be working smoothly by the target date of Nov. 30, according to several health experts familiar with the administration’s thinking.”
But it gets worse:
The potential problems are not confined to the near term either. Very soon, the short-term technical troubles could begin to have meaningful longer-term policy consequences. Insurers must decide what plans to offer and what rates to charge in the first half of next year. If enrollment is low, if the exchanges are still broken, and if the president and his administration are still losing credibility and popularity as a result of the rollout debacle, how will insurers react? By pulling plans from the market? By raising rates?
This was all predictable—in fact, it was predicted by critics of the Affordable Care Act who have been calling for its overturn, though I think that even these people have been surprised by how bad the rollout has been. In retrospect, however, what could one expect of a bill that was railroaded through Congress, using legislative novelties and shutting off discussion from people with other ideas? Nemesis was always going to show up. It’s just happening quicker than we anticipated. Let's just hope that the GOP is ready for the coming fight to replace ObamaCare with something worse: a single-payer system.