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Obamacare Enrollees Are Paying Premiums. We Think.
From Megan McArdle.
"We know that 8 million people have enrolled in Obamacare. But how
many of them have actually paid their premiums? The Barack Obama
administration has been curiously silent on this point. By now, it must
have the data, but for some reason, it chose not to issue it.
Until now. Apparently, Marilyn Tavenner, the head of the Centers for Medicare & Medicaid Services, just told Congress that 7.3 million people have paid premiums and are currently enrolled in exchange policies. What does that mean?
It’s a little hard to tell, because according to Jason Millman of the Washington Post,
she also says that this is a “snapshot” of Aug. 15, not a cumulative
figure. Why does that matter? Because there’s a 90-day grace period
between missing a premium payment and getting dropped from your
insurance. The administration says that this figure only includes people
who have “paid their premiums." But what does that mean? That they paid
a premium at least once? Or that they are current on their premium
payments?
Remember that out of 8 million total enrollments, almost
4 million people signed up in March and early April, most of them in
those last few weeks (about 910,000 just in April). Those people didn’t have their premiums due until May, or June 1.
So someone who paid a single premium in May or June and then stopped
paying would still be in the grace period, and they would technically
still be covered by an exchange policy, pending payment. For that
matter, if you started coverage in January and stopped paying six months
later, you would still show up as enrolled in Tavenner’s figure.
How
much does this matter? It depends on the relative attrition rate: How
many people stopped paying, and how many people never paid at all? If
the latter accounts for almost all the attrition, then we can expect
that 7.3 million is pretty close to the final figure for paid enrollment
in 2014; I wouldn’t expect it to fall much below 7 million,
and it might be well over that figure. If the “stopped paying” group is
substantial, then we can expect this number to grow substantially as
policies written during the late-enrollment surge lapse.
All of
which points to the need for better data on what’s happening with the
exchanges. The administration mysteriously stopped issuing enrollment
reports as soon as open enrollment closed, leaving us to guess what’s
happening from insurer statements and partial data like this.
Frankly,
I’m kind of surprised that this is the first time we’ve heard those
numbers. They’re pretty good. Oh, sure, they’re not as good as the
optimists hoped, but it’s on the low end of estimates from industry
expert Bob Laszewski, and certainly a lot better than the numbers we’ve been hearing from insurers.
I expected them to be a lot worse, based somewhat on the insurer
statements, but also because I figured the administration would have
released them if they weren’t really awful. Obviously, the
administration would prefer to tout the 8 million enrollment figure, but
it has still exceeded the enrollment projected by the Congressional Budget Office for 2014. Why not stand proud?
One
thing to note is what this means for the future: The administration
needs to nearly double this enrollment in order to reach the CBO’s
projection of 13 million exchange policies in 2015. How easy will that
be?
I’m afraid I fall back on a standard answer when I write
these columns: There’s no way to know. Open enrollment will be much
shorter this year, November to February,
and won’t be accompanied by the same sort of publicity blitz. It may
get good word-of-mouth publicity, as people encourage friends and
relatives to sign up. But you also won’t have the same kind of pent-up
demand. So we’ll just have to see. Hopefully, by then, the
administration will be able to offer us more complete data to work with.
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