Mere hours ago, California was once again touted as an example of success for Obamacare, an island of completed sign-ups in a national sea of unresponsive websites and frustrated customers.
Covered California [the state insurance exchange] has been a positive headline-generating machine for the Affordable Care Act.
So how’s the roll-out going in the Golden State of Success?
Well, for one thing, it does turn out that the Covered California leadership was inadvertently misspoken, when it announced the percentage of sign-ups by the unsubsidized solvent in the first month (October). Not that Covered California made the correction of its own volition; the truth had to be pried out of it in December by an NPR reporter (and it promptly sank, almost without a trace, in the California media).
Covered California had originally announced that 84% of sign-ups were by customers who would not be receiving subsidies. But, oops, that was a goof. The percentage actually goes the other way: 84% of those signed up through Covered California will be receiving subsidies.
There will be some question, however, where the money to pay the subsidies will come from, after 2014. The Golden State poster-child for Obamacare projects a deficit of $78 million for the 2015-16 budget – and that’s based on optimistic enrollment targets that are nowhere near being met yet.
If Covered California is to be believed – and the San Diego Union-Tribune made a good case for skepticism in the editorial linked above – there have been some 428,000 completed enrollments as of 27 December (against the 1 million-plus plans that have been canceled due to implementation of Obamacare). The enrollments may put California head and shoulders above the 49 other states, but they’re well short of the 1.4 million needed to meet the goals on which the program’s fiscal viability was calculated earlier in the year.
We can also be pardoned for doubting the claim of 428,000 completed sign-ups, if that’s supposed to mean “428,000 plans that an insurer has registered and a customer knows what to do next about.” Or, for that matter, that a customer plans to do anything next about, given that Covered California is out beating the bushes to encourage new enrollees to actually pay their premiums.
“It’s important for people to realize that their policies will not take effect simply because they enrolled for coverage,” said Anne Gonzales, a spokeswoman for Covered California, the agency running the state’s health exchange.
“They have to submit their payments,” she said.
Well, sure. Some of them, of course, are good citizens with the best of intentions, who simply haven’t heard from their new insurance companies yet, can’t get hold of the insurer, and don’t have the first clue how to submit a payment.
The new enrollees are protected, however, by the 90-day grace period in which they’re supposed to have their claims paid by the insurance company, and then their costs eaten by the physician and/or the hospital company, even if the customers haven’t paid their premiums yet.
This feature of the program helps explain why most California doctors will not be participating in the Covered California exchange. Not, again, that you’d know that from the disclosures made by the exchange’s leadership. Covered California’s claim, made in early 2013 before opt-in letters were even mailed to the state’s doctors, was that 85% of physicians would participate.
The problem doctors ran into, when the letters started arriving, was that Covered California wanted them to commit to the exchange without knowing what the compensation rates would be. The doctors had reason to be suspicious, as the state’s Medi-Cal program – a state version of Medicaid – offers the lowest compensation rates in the nation, substantially lower even than Medicaid itself.
Many doctors, therefore, declined to participate in Covered California sight-unseen. The estimate from state insurance brokers is that about 70% of California’s doctors will not be participating in the exchange’s insurance plans.
This hasn’t kept Covered California from inadvertently misrepresenting some doctors as participants, of course. (See Washington Examiner link above.) Meanwhile, insurance obtained through Covered California will entail significant limits on a customer’s access to hospital corporations. The reason: compensation rates mean it just won’t be worth it to the hospitals to do business with most insurers.
Yet another aspect of California’s success is the state’s anxiety to enroll Spanish-speaking participants, and, in particular, to encourage enrollment by those of uncertain immigration status. Covered California’s fortunes are expected to track with those of Obamacare in this regard:
[T]he Latino population[’s]…enrollment is considered key to the success of the Affordable Care Act’s rollout. Younger and healthier than the average uninsured American, Latinos would help create a balanced and affordable health insurance pool.
But Hispanic/Latino enrollments are way below program goals, reportedly because people in “mixed-immigration status families” fear that entering their personal information in the exchange database will result in deportation. Daniel Zingale of the California Endowment, a health-policy foundation whose fingerprints are all over Covered California, hopes that President Obama himself will assure illegals that getting health insurance won’t result in being deported, and they should sign up with confidence.
Of course, the idea that young, healthy Latinos who happen to be here illegally will be so suddenly public-spirited that they’ll sign up for health insurance, while their already law-abiding, native-born counterparts are electing not to, is either touchingly obtuse or utterly cynical. We report, you decide. I’m prepared to draw the analytical conclusion, at least: counting on people who are scared of being deported to make the insurance pool viable is a bad sign for the insurance pool.
And then there’s this event, which surely deserves to be an episode of South Park. It’s short. Read to the last sentence.
It’s the great Obamacare success story. Its numbers are suspicious, inauspicious, and every other kind of –icious, and that’s just today, before the era of actually living with health care, as administered on the Covered California insurance model, has kicked in. As of right now, there are still a few hours left on the old system. The real fun has yet to begin.