Benefit Experts Agree With Obama That ACA Has Enough Enrolled

Benefit Experts Agree With Obama That ACA Has Enough Enrolled

Health benefits consultants agree with President Obama’s assessment this week that enough Americans have signed up to private health plans under the Affordable Care Act that it will work even though there could be up to two million fewer Americans covered than the White House had hoped.

“We would agree with the president, but it’s really on a state-by-state basis,” said Bryce Williams, managing director of benefits consultancy Towers Watson’s exchange solutions segment. “We don’t even look at the national enrollments. You don’t need to get to 6 to 7 million nationally.”

The Obama administration earlier this week said 4.2 million people selected plans on either federal or state exchanges during the five-month signup period through February with less than a month to go for people to pick a plan with subsidized health benefits under the law.

On Friday, Obama told WebMD in a video linked here that he’s confident there’s enough people signing up for health insurance on the state and federal marketplaces that the law’s “going to work.”

“The basic principle of insurance is pretty straightforward:  the more you can spread the risk with more people, the better deal you are going to get,” Obama said in the WebMD interview.  “Now the pool is already large enough.  The number of people who’ve signed up is already large enough that  I am confident that the program will be stable.”

But Obama said the key will be the demographic makeup of the risk pool, which needs younger people signed up to balance the claims that will be filed by older Americans who tend to have more health care needs and will therefore cost the system more.

Health benefits consultants said there is reason to worry about whether enough younger Americans have signed up due to the website issues early on that may have hurt enrollment.

In addition, slow signups in certain states that have continued to have more technical issues, such as Oregon, could trigger health plans to sustain greater losses and consider pulling out of the program, benefits consultants said.

“From an actuarial perspective, the fact that the rollout was poor hurt initial enrollment, and the recent extension of the transitional policies through October 2016 may likely keep many out of the single risk pool, at least for the short term,”  said Tammy Tomczyk, principal and consulting actuary with Oliver Wyman Consulting Actuaries.

So far, however, health insurance companies have said the enrollment is trending younger and there have been few surprises that would require them to pull out of the program.

Americans can still enroll through the end of this month for coverage in 2014. Under the law, millions of Americans can get a subsidy of up to $5,000 to purchase an array of health plan choices that include those sold by Blue Cross and Blue Shield plans, Aetna (AET), Cigna (CI), Humana (HUM), UnitedHealth Group (UNH), depending on the state.

Despite the technical issues that dogged the healthcare.gov website and prevented millions of Americans from signing up in October and much of November, benefits consultants said they always expected the enrollment to be slow.

“Six or seven million people doesn’t sound like much in a population of 300 million, but when you consider that the majority of Americans gets their health insurance through employers, and another large chunk is covered by government programs like Medicare, Medicaid, and Tricare, you’re left with 12 million covered in the Individual market and about 48 million uninsured pre-ACA,” said Helen Leis, partner in the health and life sciences practice group at Oliver Wyman, “Six or seven million of that is good uptake after less than six months. We expect to see about 22 million lives on the public exchanges by 2018.”

No matter how many have signed up, both sides of the political spectrum will spin the numbers to their own satisfaction, benefits executives say.

“The Administration is in a race to show that more people in the worst circumstances are benefiting,” said Helen Darling, president and chief executive officer of the National Business Group on Health, a coalition of 390 employers, including American Express (AXP), Boeing (BA), JPM Morgan Chase (JPM) and Pfizer (PFE). “The opponents are in a race to demonstrate that ‘Obamacare’ is another example of flawed public policy and execution that reminds everyone that if a government agency is in charge of health insurance for millions, what happens will end up looking like the US Postal Service. The exact numbers don’t matter as much as how the 2 warring groups spin what is going on.”