Obamacare Enrollment Heads for 17 million
by Maggie Mahar at The Health Beat Blog.
Charles Gaba, who has become the “Nate Silver” for Obamacare enrollment numbers; now predicts that by April 15, 17 million Americans will have purchased their own healthcare coverage.
His back-of-the-envelope estimate includes “a nice round 8 million” who buy policies in the government marketplaces. In parentheses, he suggests: Perhaps a little higher (1M even?) and then strikes that thought; “As always,” he notes, “I’ll be more than happy to be proven wrong, as long as I’ve undershot the mark.”
Gaba then adds roughly 9 million who, (according to a Rand Corp. survey), have bought their own policiesdirectly from insurers, instead of using the Exchanges. Nine million plus 8 million brings us to an astounding number: 17 million.
Rand shared its analysis with the LA. Times, though it has not yet released its report. Obamcare’s skeptics scoff at Rand’s number; but, Gaba points out the Blue Cross and Blue Shield Association alone have confirmed its member plans have enrolled at least 1.7 million people in plans that meet the ACA’s requirements outside the exchange system.
Gaba acknowledges “Rand didn’t come out and say that the 9M figure was absolute; they just based it on a survey with percentages. Surveys include margins of error, so it could be only 8M, or perhaps 10M, or maybe a bit higher or lower.”
Gaba has gained his reputation by being meticulous—and cautious. Typically, his estimates have been conservative. Given that track record, my guess is that by April 15, we will find that at least 17 million Americans have bought their own policies.
At this point, you may be wondering: But don’t we need the roughly 9 million Americans who are purchasing policies directly from insurers to join the state marketplaces in order to spread the cost of Exchange coverage among as many people as possible?
The answer is “No.”
Here is another little-known provision in the ACA: Under the reform law, if a carrier sells policies to individuals both in the state marketplace and in the private market, the insurer must view those customers as part of one risk pool, and price their policies accordingly. The 17 million share the risk of becoming sick, while also sharing the cost of insurance that guarantees everyone access to care. All other things being equal, the larger the pool of people who buy coverage both on and off the Exchanges, the lower the risk– and the lower the cost for all of them.
“All other things being equal” includes whether the new people jumping into that pool are healthy. Recent evidence suggests that the new entrants are, in fact, younger, and as a result, more robust than those who signed up earlier. The numbers suggest that this is particularly true of the 9 million who bought their insurance off-Exchange.
Cross posted at: The Health Beat Blog
And this number does not include the kids that have been able to stay on their parents insurance and the people added to the Medicaid rolls.
It’s a delusion not to acknowledge, in general, prices will go up and/or quality will go down. It just doesn’t add up. Of course, there will be winners and losers.
So in other words PT, you are saying to keep prices down and quality up, we need fewer people with insurance. There must be a better way than restricting access to insurance.
Jerry, rather than picking winners and losers, we should allow the market to work, which tends to lower prices and raise both quantity and quality. So, everyone is a winner. Otherwise, there will be rationing, in one form or another,
Excessive regulation has costs – in time, effort, and money, which are not limitless. Deregulating, while keeping appropriate regulations, will free-up enough resources to subsidize catastrophic health care or preexisting conditions, for example, and allow a strengthening of the safety net.
Health care doesn’t materialize out of thin air, even when insurance is cheaper. You can pay less for health insurance and receive even less health care.
PT:
You are not listening to what you are being told by the author. I have had enough of your nonsense also. I bounced your last post. This is not the first time this has happened to you.
PT, I guess you mean like before the ACA, when insurance was so affordable and available.
Jack, government has done a disservice to Americans, over many decades, making U.S. health care, by far the most regulated industry, much more expensive.
We’re heading in the wrong direction with the ACA.
PT:
Jack made a good point; “I guess you mean like before the ACA, when insurance was so affordable and available.” As far as expensive, the healthcare industry is in the business of selling services regardless of the quality or impact of the service. The more the better has been the history of the healthcare industry. It has been unhindered in doing so by restriction as to outcome of the service or pharma or the cost of providing it.
Everyone–
Health insurance is far less expensive –and quality as higher (as measured by outcomes) in Europe than in the U.S.
Why? Pricing is REGULATED BY THE Government.
Virtually any health care economist will tell you that when it comes to health care, market forces do not work to bring prices down.
In virtually every other industry, the cost of technology comes down over time, as more competitors enter the market.
As you may have noticed, this does not happen in the health care market
Here are links to two posts explaining market failure in the health care industry:
Each year, the cost of medical technology rises.
Moreover, you might think that in areas where there are more docs and more hospitals compeitng prices would be lower.
Nope– in cities with more docs and hospitals prices are higher (NY, L.A., Boston, etc.)
Here are links to two posts explaining why markets do not work to lower prices or raise quality in the health care market
http://theincidentaleconomist.com/wordpress/health-insurance-market-failures-and-what-can-be-done-about-them/
http://muse.jhu.edu/journals/jhp/summary/v026/26.5haas-wilson.html
Peak Trader–
If you read newspapers, journals, etc. you would know that since the passage of the ACA health care inflation (growth in how much we spend on health care) has slowed considerably both in the private sector and in the public sector.
We’ve gone from growth of 8% a year to growth of 2-3% a year over the past 3 years. Much of the slow-down has to do with hospitals
curbing waste as the prepared for the ACA. (They knew that under the ACA there will be financial penalties for preventable readmissions and preventable errors.)
Many doctors have become more aware of waste–automatically ordering a slew of tests, for instance, rather than listening to and talking to the patient –beginning to zero in on a diagnosis, and then deciding which tests are actually appropriate.
Medicare has begun to cut fees for certain tests and treatments that are done too often with no benefit to the patient.
Going forward, doctors know that they will be rewarded for value, not volume. Value means better outcomes at a lower cost.
For example: managing chronic diseases so that the patient doesn’t land in the hospital.
Jerry Critter–
Yes– Thanks to the ACA 3 million young adults under 26 have been able to stay on their parents’ insurance.
Everyone —
Let me suggest that when someone like Peak Trader keeps repeating the same position, over and over., responding to him doesn’t
advance the discussion.
You are not going to persuade him. He is convinced that he is right–so convinced that he feels no need to offer evidence.
Meanwhile, he derails the discussion and manages to get everyone talking about what he wants to talk about:: market forces as the answer to our heatlhcare problems.
This i s not a post about market forces. It is a post about how successful Obamacare has been in getting people who were uninsured or Under-insured to sign up for insurance.
A large percentage of those signing up off-Exchange are young and healthy, as are a large percentage of those signing up on the Exchanges in March. (I will be writing more about this–with evidence–in future posts.)
Since an insurer will have to view all of his customers (both those who signed up off the exchange and those who signed up in the Exchange)
as part of one risk pool.,those customers buying insurance outside the Exchange will put downward pressure on premiums in the Exchanges. .
Also, Insurers know that under the ACA, when insuring a large group, they have to spend at least 85% of the premiums they collect on actual healthcare (paying docs, hospitals, reimbursing patients, nursing homes, covering prescriptions etc.).,
They can keep only 15% for administration– paying commissions to insurance brokers who sell their products, marketing, advertising, salaries for tens of thousands of people who provide customer service (answering the phone when you call with a question), processing claims, send out reimbursements, tracking down fraud, d “overhead”–( the real estate where their offices are located, keeping the lights on) , and finally, profits for shareholders. (There profit margins are actually very low–about 2% to 3%–much lower than profit margins for drug-makers, device makers and others involved in the HC industry.)
Insurers know that if they don’t spend 85% of premiums directly on healthcare , they will have to send rebates to their customers–as they did last year. That’s one of the government regulations in the law that will help keep a lid on premiums.
Sending out all of those checks is an administrative nightmare–much paper work,– and costly. At the same time sending out rebates is very bad PR.
You are telling your customers: Sorry, we overcharged you. They are likely to start looking for another insurer.
For this reason, insurers will pay close attention to how many relatively young (under 40) and healthy people are signing up for insurance.
They don’t want to over-price premiums and then have to send out those rebates.
Maggie, did you delete my comments or was it run75441?
PT:
I did and if you post on other threads, I will delete you there also. Quit your whining and stick to the topic of the post.
Really busy but…
“If you read newspapers, journals, etc. you would know that since the passage of the ACA health care inflation (growth in how much we spend on health care) has slowed considerably both in the private sector and in the public sector. – See more at: http://angrybearblog.strategydemo.com/2014/04/obamacare-enrollment-heads-for-17-million.html#comments”
Cause and effect not yet proven. Too early to tell.
Alternate or additional cause – care being deferred due to economic distress and/or higher insurance co-payment.
Too early for “mission accomplished” banner.
STR:
Nonsense rusty, how many times have I posted on this topic? In any case there is a percentage of the slow down attributable to the implementation of the PPACA as hospitals, clinics, pharma, etc. ready themselves in preparation for the PPACA. The only thing which may disrupt such a slowdown is the consolidation of hospitals and clinics which I also wrote about. You are too vague (as usual) in your pronouncements.
“According to the report, hundreds of billions of dollars in federal spending for Medicare and Medicaid are being removed from government projections as federal healthcare spending is now expected to be full 15 percent less than what had been initially budgeted for 2012. The surprisingly low spending projections come as the growth in healthcare spending has hit a new low for the fourth consecutive year.
To be sure, a big part of the decline in healthcare spending is the result of the recession’s impact on people’s ability to lay out cash on health related expenditures. Indeed, up until this point, most analysts have agreed that the poor economy was pretty much the sole cause for the improvement we have seen in containing the explosion of healthcare spending.
Now, experts are beginning to recognize that the Affordable Care Act may, in fact, be contributing to the good news—a significant development as bending the cost curve was a primary goal of Obamacare.
Douglas Elmendorf, Director of the CBO, noted that while much of the savings are the result of a loss of wealth due to the recession. But, for the first time, Elmendorf was willing to say that a ‘significant part’ of the savings are the result of structural change in how healthcare is now being delivered.” http://www.forbes.com/sites/rickungar/2013/02/12/new-data-suggests-obamacare-is-actually-bending-the-healthcare-cost-curve/
http://www.beckershospitalreview.com/finance/cbo-lowers-estimated-cost-of-ppaca-by-9b.html CBO Lowers Estimated Cost of PPACA Insurance Provisions By $9B
“Medicare spending per beneficiary, adjusted for inflation, is expected to grow by an average annual rate of 1.5 percent between 2014 and 2024, much slower than the average rate of 4 percent experienced between 1985 and 2007. The influx of baby boomers into the program will reduce the average beneficiary age, along with average healthcare costs per beneficiary, since younger enrollees tend to be healthier.
The slow growth rate also takes into account the slowdown in Medicare cost growth observed during the past several years and constraints on reimbursement included in the PPACA and in Medicare’s sustainable growth rate.”
Rusty,
Agreed.
Maggie,
So nice to read someone that makes sense.
Maggie-We look forward to your evidence that a large percentage of those signing up outside the exchanges are “young and healthy”.
I am curious as to your educated guess as to how many uninsureds have actually signed up, excluding Medicaid. The Times article quoted Rand as saying that the vast majority of non-Exchange sign ups were previously insured. The article also used a figure from McKinsey indicating 27% of Exchange enrollees were previously uninsured while alluding to a higher percentage from Rand’s survey.
Little John:
That post should be up now.
“The Times article quoted Rand as saying that the vast majority of non-Exchange sign ups were previously insured.”
That probably means that they were able to get better insurance coverage at a lower price. That is a plus thanks to ACA!