Healthcare.gov appears to be working much better, at least in enabling individuals to select plans. And some of the state exchange web sites appear to be improving their functionality too. Some have heralded these advances as providing hope that the Exchanges will be able to meet the enrollment projections on which the economics of insurance without medical underwriting in part depend. But do these claims stand up to the cold light of mathematics? Not very well.
Here’s the headline:
A close look at the numbers shows that the pace of enrollments from here to the close of open enrollment needed to meet projections is high in every state, even those touted as successful, and almost impossibly high in many. Given the incredibly slow start in most jurisdictions, it will not just take a little pickup over the next few months to achieve the projected and needed number of persons in the Exchanges. It will take a miraculous last minute stampede. Since miracles seldom occur, the result may be two different stories of the Affordable Care Act: a few states in which the Exchanges proved from the start to be a somewhat stable mechanism for providing health insurance without medical underwriting but a significant number of other states in which the results for at least the first year represent a large failure.
News appears to be breaking out that the federal exchanges enrolled about 100,000 in November. This is being heralded as somewhat of a success compared to the 26,000 who enrolled in October. And, of course, enrollment figures from healthcare.gov are difficult to assess due to the actual and feared dysfunctionality of the web site. But one way to look at this is to consider what has to happen between December 1, 2013, and March 23, 2014, the close of open enrollment to make projections. The states that are dependent on healthcare.gov need about 4.84 million enrollees by the end of that period if the nation is to meet the goal of having 7 million enrolled in the Exchanges by the close of open enrollment. If, right now, there are about 126,000 enrollees in those states, we are just 2.5% of the way there.
The pace of enrollment on healthcare.gov will need to increase by a factor of about 20 in order to meet goal. In absolute terms, healthcare.gov needs to be enrolling about 42,000 people per day. And while perhaps not every single one of those people need to enroll for the system to succeed, the 7 million enrollment goal isn’t just a mere wish. There are, as I and many others have noted potentially serious consequences to the stability of insurance markets if the figures fall well short, even in several states.
Continue reading “In Which Your Author Does the Math”
Filed Under: Uncategorized
Tagged: California, Connecticut, Enrollment, Exchange, Healthcare.gov, November, Seth J. Chandler, Texas, The Affordable Care Act, The States
Dec 2, 2013
“Well, Facebook Wasn’t Built In a Day.” – Unnamed Exchange Developer.
More than 4.8 million users visited Healthcare.gov for the grand opening of the federal health insurance marketplace on Tuesday, according to officials.
It didn’t go quite as planners had hoped. In fact, if there was an unofficial word of the day, it was glitch.
Many users of Healthcare.gov reported long delays and difficulty accessing the federal insurance marketplace, experiencing “glitches” ranging from error messages to blank pages. The problems were repeated at state-run exchanges around the country to varying degree, from California to New York.
Pundits like Wonkblog’s Ezra Klein were quick to point out that the political victory the GOP might have gained from the uncertain start was largely lost in the uproar in Washington over the government shutdown, which dominated news reports.
At least one frustrated user chronicled the experience (see related post ‘Descent into Madness: One Man’s Visit to Healthcare.gov, October 1st ). Others took to Twitter to express their outrage or show off their savage or finely-tuned senses of humor.
Users of the federal exchange reported problems including error messages (see above), funky dropdown menu behavior, page freezes, blips, broken links and long page load times — generally either a sign of high volume or inelegantly designed databases.
HHS officials declined to reveal how many people signed up for new insurance plans overall, leading some theorists to speculate that not very many people were able to make it through the process successfully. In point of fact, there were suspiciously few reports of users successfully completing the registration process at all, probably not a very good sign and possibly an indication of a disaster. Continue reading “Reports Suggest Exchange Numbers Are Very Low”
Filed Under: THCB
Tagged: California, federal exchange, Healthcare.gov, New York, State-run exchanges, The Affordable Care Act
Oct 2, 2013
Back in 2010 — before two elections, before the Supreme Court ruled, before the word “crisis” stopped following the words “California budget” — Kim Belshé settled on a guiding principle: “2014 is tomorrow.”
And now, it almost is.
The Affordable Care Act’s individual mandate takes effect in less than 100 days. The nation’s health insurance exchanges go live next week.
And for nearly a year, Belshé — secretary of the Health and Human Services Agency under former Gov. Arnold Schwarzenegger — was at the center of California’s efforts to begin implementing those Obamacare provisions and many others.
I interviewed Belshé, Schwarzenegger, and nearly a dozen other ex-officials and experts about whether California’s quest to lead the nation on ACA implementation actually paid off — and what it brought the state.
Why California? Why Not?
Every expert suggested that the ACA’s rapid implementation in California could be traced back to Schwarzenegger’s efforts in 2007 and 2008 to enact universal health care.
(And in some cases, even older efforts at reform. “We learned a lot from the 1990s,” says Belshé, noting that failed attempts to create purchasing cooperatives in California helped set the foundation for designing insurance exchanges more than a decade later.)
Although the Schwarzenegger plan ultimately failed, many of its components — from big elements like the exchanges to smaller pieces like guaranteed issue — ended up in the ACA. And because state leaders had already done much of the foundational work, they were better positioned to speedily roll out the national law.
Daniel Zingale, senior vice president of the California Endowment, says that Schwarzenegger’s efforts were a preview of the national ACA battle to come — which meant that many stakeholders in California had already made peace with the law’s key provisions by 2010.
“We’d had our big fights over the individual mandate here” in 2007 and 2008, says Zingale, a former health care aide to Schwarzenegger. “Democrats and labor groups had been through it [and] were ok with it.”
“But the nation hadn’t been through that yet.”
Still, California’s support for Obamacare was hardly assured. As late as January 2010, Schwarzenegger wavered on the ACA — but by April that year, he was the first Republican governor (and one of the first governors in the nation) to throw his support behind the law and begin crafting a framework for implementation.
“It gave us a bit of a head start,” Belshé acknowledges.
Continue reading “Did We Get It Right? A Behind the Scenes Look at California’s Healthcare Strategy”
Filed Under: Health Plans, THCB
Tagged: California, Dan Diamond, The States
Sep 25, 2013
As states race to implement health reform, California doesn’t want to settle for second.
“We don’t want to be a pace car state” when it comes to implementing health reform, state HHS Secretary Diana Dooley told Politico back in January 2011. “We want to be the lead car.”
It’s a metaphor that California leaders have returned to time and again. And to their credit, they’ve often succeeded.
While other states waffled, Golden State officials quickly embraced key Obamacare provisions like expanding Medicaid and creating insurance pools for individuals with pre-existing conditions.
At the same time, lawmakers crafted legislation intended to conform California’s health insurance plans to new standards under the Affordable Care Act.
And Covered California, the state’s health insurance exchange, also has drawn national attention for its speedy implementation. Among the 17 states that opted to run their own exchanges, California has “certainly [been] in the lead on getting their health plan information out … and getting the contracts signed,” Rachel Dolan, who monitors exchange activity for State Refor(u)m, a project of the National Academy of State Health Policy, said.
But the driving metaphor only extends so far.
“I don’t think it’s a race,” Dolan added, cautioning that each state might take unique approaches to exchange implementation — and objectively judging those individual strategies is impossible.
And a more essential issue might be getting lost, amid the growing number of questions over which state exchanges will be open for business on Oct. 1.
“Lots of people are asking about readiness,” said Caroline Pearson, who leads Avalere Health’s efforts to track health reform implementation. “But no one is asking about whether it matters.”
Where the States Stand on Readiness
The sprint to get the exchanges off the ground — which for some states didn’t really begin in earnest until after the Supreme Court’s June 2012 decision to uphold the ACA — has led to repeated delays and ongoing concerns.
Continue reading “The Exchanges Won’t Be Ready in Time. And it Probably Won’t Matter.”
Filed Under: Health Plans, THCB
Tagged: California, Dan Diamond, Health Insurance Exchanges, Obamacare, The Affordable Care Act, The States
Sep 5, 2013
I have to say I was surprised with the press reports last week that there wasn’t “rate shock” in California when the California exchange offered preliminary information about their new plans and rates.
At least one prominent health actuarial group had predicted a 30% baseline increase in costs for California’s new health insurance exchange plans under the Affordable Care Act (ObamaCare”).
As the director of the California exchange put it, “These rates are way below the worst-case gloom-and-doom scenarios we have heard.”
But a few days later there is lots more information coming out and it would appear we have a case of apples to oranges to grapefruit. And, we have a pretty good case of rate shock.
First, the exchange officials pointed out that we have to be careful to compare apples to apples when looking at 2013 rates and comparing them to the 2014 exchange rates because the 2014 exchange plans have far more generous benefits.
Yes we do, particularly when the California exchange forces us to give up our apple and buy a more expensive orange.
One of the reasons health insurance in the exchange will cost a lot more in most states is because the new health law outlaws many of the existing plans now being offered and requires only those much richer plans to be sold.
Are people going to get more coverage for their money? Yes. Do they want more coverage if the premium costs for those plans is a lot higher? Likely yes if taxpayers are paying for most of it. If not, clearly they didn’t want to pay for it before. Come January, lots of California consumers in the small group and individual market are going to get a letter from their existing insurer telling them their current plan is no longer available and the cost of the new required plans will be a lot more.
Simply, the new law is taking plan design choices away instead of letting the consumer decide what is good for them. Does that matter in California?
Continue reading “Rate Shock and Awe in California”
Filed Under: THCB, The Business of Health Care
Tagged: California, Health Insurance Exchanges, Rate Shock, Robert Laszewski, The Affordable Care Act, The States
May 28, 2013
If it is done right, the Affordable Care Act (a.k.a. Obamacare) may well promise uninsured Americans a lot more than cheap, reliable medical care. It can also open the door to the democratic empowerment of millions of poor people, who are often alienated from much of the nation’s civic life, by strengthening the organizations that give them a voice.
This year more than 30 million uninsured Americans are to begin signing up for Obamacare, but the vast majority of those eligible for either the expanded Medicaid program, or for subsidized private health insurance through state health exchanges, have no idea how to enroll. Surveys and focus groups have found that up to three-quarters of Americans who might directly benefit from the program are skeptical that the law can provide high-quality insurance coverage at a price they can afford.
Continue reading “Obamacare’s Other Benefit”
Filed Under: OP-ED, THCB
Tagged: Activism, California, Covered California, Georgia, Health Insurance Exchanges, Health Plans, Louisiana, Medicaid Expansion, Nelson Lichtenstein, Texas, The Affordable Care Act, The States, the uninsured
Mar 27, 2013
So far California has received $910 million in federal grants to launch its new health insurance exchange under the Affordable Care Act (“Obamacare”).
The California exchange, “Covered California,” has so far awarded a $183 million contract to Accenture to build the website, enrollment, and eligibility system and another $174 million to operate the exchange for four years.
The state will also spend $250 million on a two-year marketing campaign. By comparison California Senator Barbara Boxer spent $28 million on her 2010 statewide reelection campaign while her challenger spent another $22 million.
The most recent installment of the $910 million in federal money was a $674 million grant. The exchange’s executive director noted that was less than the $706 million he had asked for. “The feds reduced the 2014 potential payment for outreach and enrollment by about $30 million,” he said. “But we think we have enough resources on hand to do the biggest outreach that I have ever seen.”
Continue reading “A $910 Million Price Tag For California Exchange: A Dark Omen of Things to Come”
Filed Under: Health Plans
Tagged: California, Covered California, Health Insurance Exchanges, HIEs, New York, Robert Laszewski, The Affordable Care Act, The States
Mar 24, 2013
Say “employee benefits” and pensions and health care will jump to most people’s minds. Maybe life and disability insurance will pop up as well. But employers in Silicon Valley are going way beyond that. They’re providing housekeeping, cooking, babysitting and a host of other services as perks for their employees. According to The New York Times, here is what some California companies are doing:
At Evernote, a software company, 250 employees — every full-time worker, from receptionist to top executive — have their homes cleaned twice a month, free.
Stanford School of Medicine is piloting a project to provide doctors with housecleaning and in-home dinner delivery.
Genentech offers take-home dinners and helps employees find last-minute babysitters when a child is too sick to go to school.
To hear the employer representatives tell it, companies are providing their workers with services that make it easier to balance home and family life in an age when there are few stay-at-home spouses and work is stressful.
But a more likely explanation is economics.
Continue reading “Employee Benefits Gone Wild”
Filed Under: The Business of Health Care
Tagged: California, employee benefits, Employees, Employers, flat tax, John Goodman, Laurence Kotlikoff, marginal tax rates, Silicon Valley
Feb 26, 2013
For the third year in a row, national health spending in 2011 grew less than 4 percent, according to the CMS Office of the Actuary. However, the report said modest rebounds in pharmaceutical spending and physician visits pointed toward an acceleration of costs in 2012 and beyond. CMS’s analysts make much of the cyclical character of health spending’s relationship to economic growth and also forecast a doubling of cost growth in 2014 to coincide with the implementation of health reform.
This non-economist respectfully disagrees and believes the pause could be more durable, even after 2014. Something deeper and more troublesome than the recession is at work here. As observed last year, the health spending curve actually bent downward a decade ago, four years before the economic crisis. Health cost growth has now spent three years at a pre-Medicare (indeed, a pre-Kennedy Administration) low.
More Than The Recession Is At Work
Hospital inpatient admissions have been flat for nine years, and down for the past two, despite compelling incentives for hospitals to admit more patients. Even hospital outpatient volumes flat-lined in 2010 and 2011, after, seemingly, decades of near double-digit growth. Physician office visits peaked eight years ago, in 2005, and fell 10 percent from 2009 to 2011 before a modest rebound late in 2011 — all this despite the irresistible power of fee-for-service incentives to induce demand.
The modest rebound in pharmaceutical spending (2.9 percent growth) in 2011 appears to have been a blip. IMS Health reports that US pharmaceutical sales actually shrank in 2012, for the first time in recorded history, and that generic drugs vaulted to the high 70s as a percent of prescriptions!
There is no question that the recession’s 7-million increase in the uninsured depressed cost growth. But the main reason health cost growth has been slowing for ten years is the steadily growing number of Americans — insured or otherwise — that cannot afford to use the health system. The cost of health care may have played an unscripted role in the 2008 economic collapse. A 2011 analysis published in Health Affairs found that after accounting for increased health premium contributions, out-of-pocket spending growth and general inflation, families had a princely $95 more a month to spend on non-health items in 2009 than a decade earlier. To maintain their living standards, families doubled their household debt in just five years (2003-2008), a debt load that proved unsustainable. When consumers began defaulting on their mortgages, credit cards and car loans, the resultant chain reaction brought down our financial markets, and nearly resulted in a depression.
By sucking up consumers’ income since 2008, the rising cost of health benefits has weighed heavily upon the recovery. According to the 2012 Milliman Cost Index, the cost of health coverage rose by 32.8 percent from 2008 to 2012, while family income did not grow at all in real terms. The total cost (employer and employee contributions plus OOP spending) of a standard PPO policy for a US family of four was $20,700, almost 42 percent of the US household median income in 2012.
Continue reading “The Gold Plated Health Care System: What the New Numbers Tell Us about the State of the Economy”
Filed Under: Economics, THCB, The Business of Health Care
Tagged: California, CMS, CMS Office of the Actuary, Costs, Health care spending, Health Insurance Exchanges, Jeff Goldsmith, Massachusetts, Medicaid Expansion, The Affordable Care Act, The States
Feb 2, 2013
Visit SDIndyACO.com, and you’re greeted by a Hawaiian shirt hanging in an otherwise empty closet. “Future home of something quite cool,” the page’s headline reads.
Forget unicorns, camels and all the other metaphors used to describe accountable care organizations these past few years.
The website — the homepage of the newly formed San Diego Independent ACO, which was one of 106 organizations named last week to Medicare’s Shared Savings Program — could sum up where we stand now on ACOs.
While we’re close enough to see their outline, some ACOs are still just teasing their promise. Many organizations have yet to launch a Web presence (or in San Diego Independent ACO’s case, are waiting to get CMS approval). And more health care providers are rushing to build the ACO structure in hopes of winning federal contracts — and filling out the details later.
Understanding the Medicare ACO Model
The ACO model is loosely defined as having integrated teams of providers share responsibility for caring for a select population of patients. (That isn’t a new idea – and based on that definition, California’s had dozens of physician-led groups and integrated networks essentially operating as ACOs for years.)
Continue reading “Inside Three ACOs: Why California Providers Are Opting for the Model”
Filed Under: THCB, The Business of Health Care
Tagged: ACOs, APCN-ACO, California, California Healthline, Dan Diamond, Medicare ACO Model, The States, UCLA
Jan 16, 2013