Briefing Report: The Uninsured, the Affordable Care Act and an Uncertain Future

A Fuzzy Snapshot of a Moving Target: ACA Enrollment
Thursday, May 8, 2014

"Under the reform we seek, if you like your doctor, you can keep your doctor. If you like your private health insurance plan, you can keep your plan. Period."  i
-- Remarks of President Obama
Weekly Address, August 22, 2009
Also,’s “Lie of the Year”  ii


With the opening of the state and federal health exchanges last October, the nation was finally able to see the fulfillment of the sweeping promises made by the president and other supporters of the Affordable Care Act to expand access to care, control costs and improve care. Except, of course, for want of marginally functional websites for the federal exchange and many state-based ones, the nation saw no such thing. The incompetent deployment of the web-based enrollment systems were described as a one-time misstep, resulting from too much to do in too little time, the government’s too-restrictive technology procurement system and even, as the president weakly tried to dodge responsibility, Congressional Republican opposition to the ACA.  iii

The ACA before the Exchanges Opened

“But we have to pass the bill so that you can find out what is in it, away from the fog of the controversy.”  iv
-- Speaker Pelosi
National Association of Counties Annual Legislative Conference, March 9, 2010

President Obama signed the Affordable Care Act (ACA) on March 23, 2010. The law enacted wide-ranging, comprehensive changes to health care coverage and delivery, phased in over four years, culminating with the expansion of the nation’s health care program for lower-income citizens, Medicaid, and the nation-wide, federal and state-based exchanges offering subsidized health coverage, opening October 1, 2013. While the ACA seeks numerous changes to health care, the most important metric is the expansion of coverage, as it tests the value of all the other ACA changes and goals. Expanding coverage is the most important reason for the ACA, proponents say. v Measuring expansion of coverage through exchange-based plans and policies is the most critical statistic, as Americans are required to pay (albeit not voluntarily, given the ACA’s individual mandate, and subsidized by taxpayers, depending upon income level) for their health care coverage.

To be fair, the ACA made changes resulting in expanded coverage prior to the exchanges opening. Among the more notable changes are three million young adults who are now allowed to stay on their parents’ plan until they turn 26 years old; the prohibition of coverage rescission; and establishment of a temporary federal high-risk pool for pre-existing conditions (which the federal government was forced to close because of low enrollment and high costs vi).

However, implementing the ACA was more difficult, and politically more costly, than proponents expected. Congressional Democrats lost their majority in the House of Representatives in the 2010 mid-term elections; the ACA barely survived a constitutional challenge, losing the nation-wide expansion of Medicaid program in the process; and at least 40 changes (22 of them unilaterally by the Obama Administration). vii Most embarrassing of all, of course, were the highly visible, mass failures of the various health exchange websites across the nation. viii

The Federal and State-Based Exchanges Open for Business

“Let’s just make sure it’s not a third-world experience.” ix
-- Henry Chao, Deputy Director
Office of Information Services at Centers for Medicare & Medicaid Services
AHIP Conference, March, 2013

As is widely noted, the health care exchanges opened with a resounding crash. Undoubtedly, there are many third-world governments with far better working websites than those of the various exchanges that opened for business October 1, 2013. Covered Oregon never worked, leading the State of Oregon to announce April 25th that it was shutting its exchange, surrendering this function to the federal exchange. x However, despite the long website outages, lost and duplicate applications, inability to determine subsidy eligibility, failure to connect with insurers’ databases and incorrect provider directories, among other failures, the ultimate test of the ACA’s long-term viability is enrollment. On this point, the Obama Administration is claiming victory, announcing approximately eight million enrolled in exchange plans during the open enrollment period. xi

Among the enrollment achievements touted by the president:

  • 8 million enrolled in private insurance in the federal and state exchanges.
  • 3 million young adults gained coverage being able to stay on their parents plan.
  • 3 million people enrolled in Medicaid and CHIP as of February.

ACA proponents mark these numbers as signs of the law’s success. At first glance, they do seem impressive, especially in light of the exchanges’ various and numerous failures, and they resulted from a late surge in enrollments before the deadline. xii However, they do bear closer examination.

Is the ACA Really on Track to Reduce the Ranks of the Uninsured?

“I just see a huge train wreck coming down.” xiii
-- Sen. Max Baucus (D-Mont.)
Senate Finance Committee Hearing, to HHS Secretary Kathleen Sebelius, April 17, 2013

Senator Baucus, who voted for the ACA, alertly warns Americans of the ACA’s risk for failure. The goal of making health care coverage accessible and affordable for all Americans, to fix the problem of the un-insured, xiv is most easily tested by simply looking at the rate of the un-insured. This is because reporting of hard numbers on ACA enrollments from state and federal agencies, and enrollees’ previous coverage status (e.g., there is no official number of policy cancellations forced by the ACA, nor is there an accounting of people who voluntarily dropped coverage [in either the individual market or from their employer, nor is there, shockingly, even data on those who migrated from “un-insured” to “covered”] and therefore took up coverage through an exchange) is disappointingly unavailable. Thus, the need to compare enrollment numbers with the number of un-insured.

According to the Office of Assistant Secretary for Planning and Evaluation (ASPE) within the U.S. Department of Health and Human Services (HHS), “the percentage of people without health insurance in 2010 was not statistically different from 2009. In 2010, the percentage was 16.3%, compared to 16.1% in 2009. Among the non-elderly, 18.4% of individuals were uninsured in 2010, which is not statistically different from the non-elderly uninsured rate of 18.2% in 2009. During 2010, 49.9 million people were without insurance.” Additionally, ASPE reports, “Young adults are the age group least likely to have health insurance.” According to ASPE, this rate has crept up from 13.6% un-insured in 1999 to 16.3% in 2010. xv

For California, the U.S. Census reports the three year average over 2010-12 was 7.1 million people, or 18.8%. xvi These rates of un-insurance generally correspond to those published by the Kaiser Family Foundation, which reports the national rate of un-insurance at 47.95 million, or 15% over 2011-12, and California’s rate at 7.1 million, or 19% over the same period. xvii

Spin or Reality?

“Don’t let people confuse you. Don’t let them run the okie doke on you. Don’t be bamboozled.” xviii
-- President Barack Obama
May 2013

As the President admonishes, no one wants to be bamboozled. As noted previously, the Obama Administration claims eight million new enrollees in ACA coverages, and three million enrollees in Medicaid and CHIP (Children’s Health Insurance Program), or 11 million total. xix Using the government’s own figures, that represents a reduction in the nation’s rate of uninsured by 22%, or a little more than one-fifth.

For California, buried at the bottom of a celebratory press release, Covered California reports 1,395,929 enrollments in a Covered California plan, and an additional 1.9 million enrolled in Medi-Cal (California’s Medicaid program), for an approximate total of 3.3 million people through the end of March. xx To the degree these numbers are accurate, they indicate a reduction of California’s 7.1 million uninsured by more than 46%.

These reductions in the un-insured, especially California’s, are impressive, yet are they real? The Medicaid enrollments most likely are, as they require little or no costs from enrolled beneficiaries. But are the ACA enrollment numbers touted by the Obama Administration and Covered California real?

Premiums Paid = Fully Enrolled

“The implementation of this is fabulous.” xxi
-- House Democratic Leader Nancy Pelosi
June 2013

Despite Representative Pelosi’s extraordinarily premature celebration of the ACA’s implementation, insurance coverage is not in effect until premium is paid, whether it is insurance for one’s car, house, or health care. To date, it appears most media reports, like this one: “15-20 Percent Aren't Paying Obamacare Premiums, Insurer Says” by National Journal xxii suggest the premium payment rate is somewhere between 80 and 85%. This is important because an unpaid policy is, in effect, a policy in which enrollment never really happened.

However, recent information disclosed by the U.S. House of Representatives Energy and Commerce Committee on April 30th suggests the 80-85% premium payment rate is grossly inflated. xxiii The committee asked all the health insurers and plans participating in the federal health exchange about specific enrollment data, including the number who have paid their first month’s premium and demographic breakdowns. The health insurers and plans responded that only 67 percent of individuals and families that had selected a health plan in the federally facilitated marketplace had paid their first month’s premium and therefore completed the enrollment process. Of those who paid, only 25 percent of enrollees are ages 18 to 34.

If the numbers reported by insurers to the Energy and Commerce Committee are accurate, one can see that the eight million new enrollees nationally reduces to 5.36 million, and the nation’s rate of un-insured increases from a 22% reduction to a less-impressive 16.7% reduction. For California, the number of enrollees in a Covered California plan would reduce to 935,272, and the state’s rate of un-insured increases from a 46% reduction to a less-impressive 40%. Importantly for California, the reduction in the un-insured would be mostly in the Medi-Cal eligible population, by a factor greater than two to one.

ACA-Forced Cancelations of Policies Americans Liked Complicates Enrollment Numbers

“Even if it takes changing the law, the president should honor the commitment the federal government made to those people and let them keep what they got.” xxiv
-- Former President Bill Clinton
Web Interview,, November 12, 2013

If the number of “900,000” enrollees in Covered California sounds familiar, it roughly comports with the “estimated 1.1 million people that have received cancellation notices informing them that their chosen and paid for plans were out of compliance with the federal health care overhaul.” xxv While hard numbers are difficult to come by, an estimated five million plans nationally were canceled because they were not deemed “good enough” by the ACA. As the oft-stated goal of the ACA was to expand, rather than reduce coverage, these forced cancelations created quite a bit of political controversy, putting safe Democratic-held Senate seats in play for the November 2014 mid-term elections. xxvi The president responded in November by first allowing people to keep their plans for an additional year, xxvii and then extending that period to two years in March. xxviii

These five million canceled plans, enrolled in by choice and paid for by Americans, presumably comprise a large percentage of the eight million new enrollees in ACA plans nationwide. It is difficult to declare all five million canceled plans resulted in purchases of new coverage from exchanges, as an estimated five million ACA compliant plans have been purchased outside of the exchanges xxix (it is equally difficult to declare that all five million policies were replaced outside of the exchanges). However, it is worth noting the five million canceled policy number closely comports with the percentage of paid plans reported by insurers to the Energy and Commerce Committee.

Dazed and Confused For So Long, It's Not True xxx

“I think that probably no one fully anticipated when you have a law that phases in over time how much confusion that creates for a lot of people.”
-- HHS Secretary Sebelius
Forum at Harvard School of Public Health, April 8, 2013

The United States is the world’s largest economy, and home to the computer, the silicon chip, and the most advanced technology in the world. Americans were once the people who put men on the moon. Americans knew how to get big things done, and done well. Yet, we are unable to conclude if the ACA is really reducing the rate of the un-insured. Why can’t we answer this simple question? Because, inexplicably, no one thought to require the exchanges to ask enrollees a very easy question: what is your current coverage status? The Babylonians undertook population censuses 6000 years ago in 3800 BC, xxxi yet the federal and various state governments could not anticipate the need to track a basic marker of the ACA’s implementation.

Proponents of the ACA, of course, are invested in its success and will promote any indicators of success. Unsurprisingly, the White House press secretary disputed the data collected by the House Energy and Commerce Committee, while not providing any data to counter the committee’s numbers. xxxii In the absence of hard, reliable and verifiable numbers from the Obama Administration, it is safe to conclude that most, if not all, people who had policies canceled by the ACA are: 1) the most likely to enroll in ACA coverages once their plans were canceled, and 2) the most likely to pay their premiums once enrolled. These five million policies (not including the breakdown on how many people these policies covered, as many policies undoubtedly covered more than one family member) assuredly comprise a large percentage, if not the majority, of new, fully paid ACA enrollees. Additionally, because a large share of these five million policies converted to ACA-compliant policies (whether through an exchange or not), we know that, at least in year one of the ACA exchanges, the ACA can take credit for churning policies. What it cannot indisputably take credit for, however, is significantly reducing the rate of the un-insured.



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 xxx Page, Jimmy. Dazed and Confused for so long it's not true. "Dazed and Confused.” Led Zeppelin. Album. Atlantic Records. 1969.
 xxxi (retrieved 5/2/14)
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For more information on this report, contact Tim Conaghan, Senate Republican Office of Policy at 916/651-1501.