The Department of Health and Human Services released updated data yesterday on enrollment on the Exchanges including, for the first time, greater breakdowns on enrollment by several key categories: age, gender, and the metal level of purchase.
The result of this long awaited and much requested data is, at first glance, very much a mixed picture. Some of the overall statistics do not look as problematic as some — including me — had feared they might be. But it looks as if there is a very serious potential for large adverse selection problems brewing in a number of states, most notably West Virginia, Mississippi, Maryland and Washington State.
The good news for the ACA from the data
There are three major pieces of good news for those who support the goals of the ACA.
1. The overall gender distribution of enrollees, 54% female, 46% male does not appear on preliminary inspection to be sounding “red alert.” To be sure, the problem may be a little greater than would otherwise be suggested by the aggregated numbers if the middle age group is more heavily female and the oldest group of enrollees more heavily male that the aggregated numbers suggest. And Mississippi is troubling with 61% female enrollment (and for other reasons, see below).
But, overall, and if they hold up, these do not appear to be the the kind of numbers that would be way beyond what insurers likely expected or that, standing by themselves, would be devastating to an insurer on an Exchange.
2. Several states have total enrollments and the age distributions that should reduce the possibility of a serious death spiral getting started. New York and California are the two big states doing better than most. Connecticut is doing very well also.
3. The metal tier distribution is 80% for Bronze and Silver policies and only 20% in Gold and Platinum. That’s comforting for adverse selection. A higher proportion of enrollment in the more generous plans would have been a warning sign that enrollment was coming disproportionately from the sick.
There’s a footnote on this point later on — we are not out of the woods — but this is definitely better news for the ACA than a distribution of, say, only 50% Bronze and Silver purchases.
The bad news
Just because the ACA is doing better than some had forecast on an overall basis does not mean there will not be very serious problems in some states. Given that the statute is presently unamendable as a practical matter, problems in just a few states can hurt a lot of people.
The data released by HHS yesterday shows that there are a number of states in serious trouble.