Those who purchased Obamacare plans during the January enrollment period were 40% lower than earlier government and private estimates. The Congressional Budget Office (CBO) had predicted 21 million sign-ups for this year, yet there were only 12.7 million. About 1 million people are expected to drop, or be dropped from, their plans during the year due to inability to pay or lack of payment of premiums. It is unclear how many people are buying health plans through insurance brokers and companies directly, rather than using the exchanges.
Both sides of the law agree that the exchanges need a better balance of low and high income people buying plans. With more unhealthy people, the rates continue to rise. Low-income people tend to have more health problems. Higher income people tend to already be insured.
The plans are too expensive for those who make 400% of the poverty level ($97,000 for family of four). Higher income makes them ineligible for subsidies and tax credits. Only 3% of those buying plans on the exchanges earned more than this amount, while last year this number was estimated to be 25%.
Obamacare supporters believe that enrollment is low because the process hasn’t recovered from the original rollout in 2013. The CBO expected more employers to drop plans and force employees onto the exchanges, and thought those who were not eligible for subsidies would still buy exchange plans.
Having insurance may not be as important to people as the Obama administration thought, as other financial needs have more priority. It is cheaper to pay the penalty and pay cash for any health care needs that arise. Young people don’t want to pay for plan benefits that they don’t need or want, so are purchasing catastrophic plans for those big ticket injury or illness bills.
CMS is addressing insurers concerns by reducing the number of enrollment periods during the year. Having many opportunities to sign up ended up with many sick people, some who waited until they were sick to purchase, and then dropped the plans when they didn’t need them anymore. Insurers need more flexibility to offer affordable health plans which cover only what people really need.
O’Donnell, Jayne. “Costs, changes led Obamacare enrollment to fall short of earlier estimates.” News. USA Today, 16 Feb 2016. Web. 16 Feb 2016.