Making Sense of the Obamacare Enrollment Numbers

The White House is expected to release enrollment numbers for the exchanges later this week and the media is brimming with predictions and commentary. The true significance of these enrollment numbers will likely be obscured by the criticism and cheerleading meeting the announcement from those with vested ideological interests. In order to avoid being swept up in the spin, we should ask the following questions:

  • “What regions are included?” At this point in time, journalists are expecting data on all 50 states and D.C. If a more limited set of regions is reported (such as the federal exchange states alone), the enrollment numbers will be less effective with respect to judging health reform’s marketing success and will also open the door for more debate on the national enrollment numbers.
  • “Who counted as an enrollee?” According to a November 11th report in the Washington Post, the administration “will count people who have purchased a plan as well as those who have a plan sitting in their online shopping cart but have not yet paid.” If this report is true, the value of the numbers is diminished due to the prospect of over counting enrollments. If, instead, enrollment figures are limited to people who have had a transmitted insurance application approved by either an insurer or the Medicaid program then we can argue over the significance of the numbers and not what the enrollment numbers really are.
  • “Are the enrollment numbers for individual metal plans as well as Medicaid discretely reported?” The break-out of enrollment numbers is important for multiple reasons. First, enrollment in the different metal plans will illuminate consumer shopping behavior in a transformed health insurance market. Will the commoditization of health plans’ coverage under the Essential Health Benefits make the lowest priced Bronze Plan most compelling option or will concerns about out-of-pocket costs drive consumers to more expensive metal tiers? Additionally, will we find most consumers enrolling in the new metal plans or enrolling in their state’s Medicaid program? The percentage of Medicaid enrollees is important because Medicaid does not bring in revenue from consumers to offset state and federal spending on healthcare.
  • “What percentage of the enrollees are expected to receive subsidies?” This percentage is a dual-edged sword politically. A subsidized enrollee is someone who has directly benefited from the Affordable Care Act but is also increasing the costs of the Affordable Care Act. Neither side on this matter is more right than the other.
  • “What are the age distributions of enrollees?” A disproportionate representation of 20-something enrollees bodes well for the economics of the Affordable Care Act (if these 20-somethings are in good health and can be expected to use healthcare services infrequently). If there is a disproportionate representation of people age 50 and over, the economics of the Affordable Care Act become problematic since humans tend to use more healthcare services and prescription drugs as we age. More overall healthcare usage among health plan enrollees = higher premiums unless we decrease the cost of healthcare delivery (which we haven’t).
  • “What percentage of the enrollees were not insured at the time of application?” The reduction of the uninsured population was among the most important goals of the Affordable Care Act. The standard insurance application form asks if the applicant has existing insurance coverage so the administration should be able to report this information. A high percentage of previously uninsured among enrollees would provide considerable public relations benefits at a time when press coverage has been dominated by the technical shortcomings of the exchanges.

One of the important questions I do not believe we will answer from the enrollment numbers concerns the percentage enrollees with pre-existing medical conditions and poor health including those unable to obtain health insurance due to those factors. The standard insurance application form does not capture this information. The information, itself, is immensely valuable. In the individual and family health insurance market, one in five applicants had been their insurance application rejected often due to health considerations. If very few enrollees have poor health or pre-existing conditions then the risk pool for the Affordable Care Act plans will be in a better position to curb premium increases in the future. If the opposite is true then it will be especially difficult to constrain premium increases.

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