Obamacare “enrollment” in qualified health plans has now reached 5 million according to an announcement posted on the HHS website Monday. As with all the previous “enrollment” milestones, we know for certain this one isn’t true. What we don’t know is how far off the mark it is.
Despite the problems with the numbers, the announcement does demonstrate that the pace of enrollment has picked up significantly after a slower-than-expected February. It’s even possible the official enrollment number will reach the CBO’s downgraded prediction of 6 million by the end of the month. Of course that number won’t be any more accurate than the one we were given yesterday. Here’s why.
The issue is the way the government measures enrollment and how it differs from the way insurers measure it. The federal health exchange–the website where people go to buy insurance–still has no payment mechanism. That means the online process ends when a consumer selects a plan and the the website contacts the insurer with the new customer’s information. According to the White House the act of choosing a plan counts as one enrollment.
But insurers know that not everyone who expresses interest in buying a plan will follow through, just like not everyone who puts something in their Amazon shopping cart winds up buying it. In fact, a significant percentage of people never pay their first month’s premium. From the insurer’s perspective, those people who don’t pay were never enrolled even though they became part of government announcements like the one made yesterday.
Back in early December, Breitbart News and others began to ask what percentage of people were failing to complete the process by paying their first premium. Since the federal government doesn’t collect money or even facilitate transactions, they have no immediate way to measure how many people follow through. In short, the government knows how many people intend to enroll, not how many do.
Fortunately, outside experts and media outlets have contacted insurers directly and given us a pretty good idea. The figures vary from state to state and between large and small insurers but, on average, about 20 percent of people who select a plan never pay. At least that was the best estimate after the big surge of enrollment back in December. And that was despite numerous extensions to the payment deadline made at the urging of HHS. Some insurers gave people until early February to pay for plans with coverage starting January 1st.
We don’t actually know whether the rate of people who fail to follow through has been going up, down or been steady since then. But if we assume it has been steady then as many as 1 million of the 5 million announced yesterday are not really enrolled. That’s a huge difference obviously, more than all the people who enrolled in February.
It’s also important to note that most of the people buying are people who had insurance before. At least 4.7 million people lost their insurance at the end of last year as a result of Obamacare’s grandfathering rules. So a significant number of these “enrollments” the White House is touting are people who only needed to buy insurance because they lost what they had under Obamacare. As insurance industry expert Bob Laszewski said earlier this month “The uninsured just aren’t buying Obamacare.”
The bottom line is that we don’t know how many have enrolled so far, only that the government figures are significantly overestimating. Real world enrollment may be closer to 4 million than 5 million at this moment, which would be a very poor showing with two weeks left to go in the enrollment period.