Obamacare Markets Debut as Early Hurdles May Slow Signups
The three-year effort to open the Obamacare health-insurance exchanges culminates today, beset by logistical delays and a U.S. government shutdown borne of Republican opposition to the Affordable Care Act.
Even states that have cooperated with the rollout are downplaying the debut of the marketplaces to avoid having their websites and call centers overwhelmed. Federally run exchanges in 36 states opened at 8 a.m. Washington, D.C., time. There were indications some states were delaying their startup times by hours and some services by days.
“Our message is, ‘You are welcome to come on Oct. 1 if that’s what you want to do, but you might just want to wait,’” Jon Hager, the executive director of Nevada’s state-run insurance exchange, said in a telephone interview.
The show will go on, even with a government shutdown, as President Barack Obama seeks to fulfill the law’s promise of medical coverage for most of the nation’s 48 million uninsured. The budget fight may actually help by diverting attention away from the rollout, said Sanjay Singh, chief executive officer of hCentive Inc., a Reston, Virginia-based software company working on the exchanges.
“Because they haven’t had the time to really put the system through its paces, they are happy to see a softer kind of launch, where the traffic will be small the first couple of weeks,” Singh said in a telephone interview.
Fourteen states are running their own markets, with the rest operated in whole or part by the federal government.
Maryland pushed back the planned 8 a.m. opening of its online marketplace until noon, according to a message on its website that said the exchange was “experiencing connectivity issues.”
In Minnesota, which built its own exchange, residents can check prices and determine if they qualify for subsidies on the new MNsure website. They won’t be able to sign up until the afternoon at the earliest, after a final check to ensure the state can properly share data with the federal government, said April Todd-Malmlov, MNsure’s executive director, on a conference call with reporters.
Consumers won’t be able to get in-person help from so-called navigators or other groups designated to assist in the registration process until tomorrow at the earliest, Todd-Malmlov said. The 5,000 individuals preparing for those positions still need to complete training and clear background checks, she said.
“Consumers will have plenty of time to evaluate their options,” Todd-Malmlov said. “We are anticipating there will be a lot of interest in the site, but we don’t anticipate there will be a lot of applications in the first few weeks.”
The federal government began its first partial closure in 17 years, idling as many as 800,000 workers, after Congress failed to agree on a spending bill for the fiscal year that began today. Republicans, who control the U.S. House, had demanded a delay or dismantling of the health law as part of the funding bill. Democrats, who make up the majority of the Senate, refused to concede.
Democratic leaders who helped write the 2010 health law plan to go forward with a celebration of the exchange openings at a news conference later today. The consumer advocacy group Families USA also is organizing an event that will showcase people and small-business owners benefiting from the health law.
The White House planned its own media blitz, with the president due to meet in the Oval Office with people eligible to enroll in the exchanges. An interview with Vice President Joe Biden was scheduled to air on 450 college radio stations, appealing to an audience of young, healthy consumers considered crucial to the success of the new insurance markets.
“Shutdown or no shutdown, we’re ready to go,” Kathleen Sebelius, secretary of the U.S. Department of Health and Human Services, told reporters at a briefing yesterday.
That’s because the health law relies primarily on mandatory spending, which can’t be stopped by congressional inaction on the fiscal 2014 budget. It’s the budget category used for benefits such as Medicare and Social Security.
The $1.4 trillion Affordable Care Act requires most Americans to obtain health insurance starting next year or pay a fine. To make finding coverage easier, the law set up government-run exchanges in each state where most consumers can buy plans from insurance companies with the help of tax credits.
About two-thirds of uninsured people said they plan to buy medical coverage next year rather than pay a fine, according to a Gallup poll published yesterday.
The Obama administration is seeking to get about 7 million people to buy plans through the exchanges in the open enrollment period that starts today and runs through March.
“It’s going to be judged on Oct. 2 as a failure by opponents of reform because 7 million people haven’t signed up,” said Kevin Counihan, the director of Access Health CT, Connecticut’s exchange. “The reality is nothing like this begins with great fanfare.”
Consumers don’t have to complete enrollment until Dec. 15 to guarantee coverage starting in Jan. 1. They may be dissuaded from signing up this month because the first premium payment to their insurer is due within 30 days of enrollment.
More than 900 businesses, community groups and other organizations have agreed to voluntarily promote the law and help people sign up. Retailers Wal-Mart Stores Inc. (WMT), CVS Caremark Corp. (CVS), Walgreen Co. (WAG) and Rite Aid Corp. (RAD) plan to promote coverage in their pharmacies.
Wal-Mart, the world’s largest retailer, has invited insurance company representatives to about 3,500 stores starting in mid-October to promote their plans, said Dave Tovar, a spokesman for the Bentonville, Arkansas-based company.
The government also announced a contract with the Blue Cross Blue Shield Association, the umbrella organization for 37 state and local insurance companies, to sell health plans in 30 states, including three that previously had only one carrier participating in their exchanges.
People eligible for coverage can go to healthcare.gov to find their state’s insurance exchange. Monthly prices for the lowest-tier of plans average $249 nationwide. People with incomes less than about four times the poverty level will get discounts on their premiums by way of tax credits. For a family of four, that means those with incomes of less than about $94,000 qualify for the credits.
People with incomes under about 1.4 times the poverty level may be able to enroll in expanded Medicaid programs for the poor in about half the states.
The Obama administration needs some breathing room, Sebelius said at the briefing with reporters. She compared the exchanges to Apple Inc. (AAPL)’s new mobile operating system, which the company upgraded days after its debut to correct a flaw.
“No one is calling on Apple to stop selling devices for a year or to get out of the business,” she said. “It’s a reminder that we’re likely to have some glitches. We’ll fix them and move on.”
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