Thursday, April 3, 2014

Cutting through the fog of Obamacare signups.

President Obama is declaring Obamacare a success.  As Michael Tanner notes, the President did not take questions. 
But while the president basked in his success and predictably castigated his critics, he took no questions. Perhaps that’s because some of them would have been hard to answer. For instance:

How many new enrollees have paid their premiums? The numbers above include everyone who has “picked” a health plan, even if they haven’t yet paid for it, sort of like Amazon counting every item a shopper puts in their “cart” as a sale. Even Health Secretary Kathleen Sibelius concedes that only 80 percent of those who’ve picked a plan have actually paid the first month’s premium. Insurance executives also report that another 3 percent to 5 percent paid once, but then stopped.

If these numbers hold, it would mean that just 5.6 million Americans (and 312,000 New Yorkers) really bought insurance through the exchanges.

How many were previously uninsured? Seven million insurance sign-ups doesn’t mean 7 million more Americans with insurance. For starters, as many as 6 million Americans had to change their health plans because ObamaCare banned the policy they’d had before. Many of those whose plans got canceled bought new insurance through the exchanges, and are among the 7 million.

How many? Estimates vary, but Rand Corp. data suggest that barely a third of enrollees were previously uninsured. If so, that means fewer than 2 million Americans have actually gained insurance nationwide because of ObamaCare.

While data from New York’s Department of Insurance suggest that the state has done a better job of enrolling the actually uninsured, still, 41 percent of those signing up on the state’s exchange already had insurance. That means just 230,000 newly insured New Yorkers.

How many Americans lost their insurance? In addition to the newly insured, we also need to look at the newly uninsured. That includes some of the millions whose policies got canceled because they didn’t comply with ObamaCare. Most found new plans, though maybe more expensive or that no longer included their current doctor, but the Rand Corp. estimates that slightly less than 1 million Americans couldn’t find an affordable replacement plan, so are now uninsured. Somehow those Americans didn’t make it into the president’s remarks yesterday.

Who signed up? Far more important than the raw number of enrollees is the mix of people signing up. ObamaCare depends on young and healthy people overpaying for insurance in order to subsidize coverage for older and sicker individuals. In order to make that work, 38 percent to 40 percent of those enrolling need to be young and healthy.

In fact, estimates suggest that less than 30 percent of enrollees are under the age of 35. This will mean hefty premium hikes next year, and could eventually lead to a meltdown of the entire insurance market.

And we get all of this for the low, low price of just $2 trillion in taxpayer spending over the next 10 years.

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