When Will Most Sign Up For Obamacare?

mass_enrollment

Jonathan Cohn defends Obamacare’s disappointing initial sign-up numbers by looking at Massachusetts’s experience:

If you want to get a real sense of enrollment patterns among people choosing to shop and buy plans, it’s better to exclude the people getting free care. (In the Massachusetts plan, that would mean people who ended up enrolling in what were called “Type I” and, with some exceptions, “Type IIA” plans.) Jonathan Gruber, the MIT economist who was an architect of the Massachusetts health reforms, has provided me with those numbers. The results? Of the 36,167 people who eventually enrolled in premium-charging plans from Commonwealth Care, 123 signed up in the first month. That’s right—one hundred and twenty-three, or about 0.3 percent. Over the first two months, the number was a bit larger—2,289. But that’s still just 6.3 percent.

The analogy to Obamacare is far from perfect, in that Commonwealth Care didn’t include wealthier people who didn’t qualify for subsidies. (In the Massachusetts scheme, they essentially had a separate exchange—and enrollment there began half a year later.) Also, the Massachusetts open enrollment period was twice as long. So it’s reasonable to expect that, with a fully functional website, early enrollment in Obamacare private plans would be higher than those numbers above suggest. But the general point stands. Very few people sign up for insurance in the first few months. Most wait until much later in the game.

Given Healthcare.gov’s back-end problems, the low number of sign-ups might be better than the alternative. Kliff introduces us to the 834 form:

It is a technical, back-end reporting tool that consumers never see. It is meant to be read by computers, not human beings. It’s the form that tells the insurer’s system who you are and what you need. And it might be the new health-care law’s biggest problem. … Some in the industry believe HealthCare.gov’s traffic problems have been a blessing-in-disguise for the program: If applicants were being able to sign up easily but the 834 forms were coming in with this many errors the results could be disastrous.

Robert Laszewski explains why the 834 forms must be fixed before other parts of the website:

I almost have the sense that HealthCare.gov is in de facto shutdown. Here’s why: Government has to fix the back end before the front end. The demand here is real. I don’t think anyone can dispute that millions of people want to sign up. So if they fix the front end for consumers and thousands of people or hundreds of thousands of people being enrolled before they fix the back end, we’ll have a catastrophic mess.

When insurers are getting 10 or 20 or 50 enrollments a day they can clean the errors up manually. But they can’t do that for thousands of enrollments a day. They have to automate at some point. So I think the Obama administration doesn’t want to cross the red line to shut the system down, but I think this is effectively a shutdown in which they don’t say they’ve shut it down but it basically is shut down.