“The Affordable Care Act is no longer a political abstraction,” writes a Washington Post blogger. He’s right; it’s underway and the picture of Obamacare “by the numbers” is not pretty. The national rollout has been a disaster because of a crashing website that has prevented people from signing up and may take months to fix. But Covered California, the state’s own Affordable Care Act webpage, is also glitch-ridden and its rollout has been less than impressive.
It is amazing that three years after the law was passed so little is known about what it actually does. Put simply, it is intended to assure health insurance coverage for all Americans via a system of state insurance exchanges, expansion of Medicaid (MediCal in California), and a mandate for individuals to buy insurance. The first step in this process began on October 1 with the opening of the insurance exchanges, so it is worthwhile to see what the numbers tell us about how the new system is doing.
The exchanges fall into two categories, those run by the federal government for 34 states, and those like California that have their own exchange. No one will deny that the federal exchanges have been a mess. The software that is supposed to run the on-line system has been so bad it is estimated that 5 million lines of software codes need to be rewritten to make the exchanges work. Because of this insurers are now reporting that the system provides them with incorrect information on new enrollees, cancels some new enrollees, and completely loses others.
Despite the problems, the federal system reported over the weekend that 476,000 people had “successfully applied” for Obamacare, but that number give us no ideas how many actually enrolled in an insurance plan; while the government says it needs seven million new enrollees by the end of March for the system to work. The number of actual enrollees seems to be some sort of state secret which indicates either the government does not know or the number is so low it will not tell.
Transparency for Covered California is somewhat better, but the picture shows anything but a success. Covered California reported 16,311 “applications processed” through October 8. The Los Angeles Times reports that in the first five days, there were 43,611 “complete and partial applications”. These numbers suggest the number of applications completed are well below the number begun, and give us no idea how many people have actually enrolled in a plan.
But the Los Angeles Times story also shows a very disturbing trend that has been overlooked in the media and elsewhere. In the next seven days after October 5, only an additional 50,000 applications were begun. This indicates a slowing pace of new applications. The web traffic decreased from 907,000 in the first week to 603,000 in the second week, and telephone call volume also decreased.
What seems to be occurring is declining interest after the first burst of applications. This is common in the rollout of new products. People rush to see a new movie or buy a new Apple product when it comes out, but then over time interest begins to slack. Covered California needs to enroll 6.5 million Californians in either the exchanges or expanded Medical over the next few months to cover the state’s uninsured, and that means new enrollments, not just applications.
What seems to be happening is that many people currently with insurance are going to the Covered California page and comparing products, but not necessarily enrolling in a plan. Others are facing hikes in their current plans or cancellations of plans that do not meet Obamacare coverage guidelines, so they are desperately looking for another plan. None of this is getting coverage to the long term uninsured.
Covered California also is proving to be glitch-ridden, although not as bad as the federal system. It promised a list of medical providers for consumers shopping for new plans, but on October 9 it had to pull its list of doctors off line because of errors. The California Medical Association saidCovered California was confusing practices and listing doctors who were not in the networks. And over this past weekend the site was down for “maintenance and repairs.”
All this is quite inexcusable because Covered California had years to get ready and listing doctors available through an insurance plan should be child’s work. Covered California itself told the Sacramento Bee it never expected big signup in October but that enrollments should jump in November and December as the year-end deadline approach and that that there should be a big push close to the March 31 deadline. Perhaps, but the early numbers do not give confidence in these predictions.
According to the UC Berkeley Labor Center, some 1.4 million Californians will become eligible for expanded MediCal in 2014. That will be in addition to the six to eight million in various parts of MediCal now. Theoretically then the MediCal expansion written into Obamacare and being implemented in California should reduce the uninsured population by 1.5 million over time. But what about the rest of the 6.5 million that are uninsured? They will need to be covered either through the exchanges or the individual mandate to buy insurance. That means the available pool of uninsured is somewhere around four million Californians, and without huge enrollments of these folks Obamacare will not work.
The individual mandate comes into effect January 1, 2014. There is a penalty of up to $285 per family if you don’t sign up for an insurance plan. But there is no way to enforce this penalty, and the initial rollout of Obamacare has been such a fiasco few people will worry about actually paying a penalty if they do not sign up.
An additional defect of the current exchanges is that we have no idea whether healthy or sick people are signing up. If the exchanges are heavily weighted toward sick people, the system will need healthy people to come in through the mandate to make the insurance system work.
So what does “Obamacare by the numbers” tell us three weeks into the program. First, the national and California numbers are quite weak given the huge enrollments that will be necessary. Second, the system is extremely complex and will require millions of new enrollees to work. Third, putting together the websites should have been the easy part; getting millions to signup will be the hard part as the public seems basically disinterested or cynical that there is anything in it for them.
Obamacare is not yet the train wreck that Republicans insist it will be. But the trains are not running on time, and in some cases not running at all. The Obama Administration had the advantage of the Republican foolishness whose government shutdown shielded it from close inspection during the first two weeks of the rollout. That protection is now gone, and the system is now going to be judged on how it works, and the numbers will tell the story.