WASHINGTON — Even with its health insurance marketplace floundering for the
fourth week, the Obama administration is resisting what some Democratic allies
contend is the most logical response to the problem: giving consumers more time
to sign up.
According to insurers and the White house, delaying the deadline could
undermine efforts to lure a broad, young and healthy mix of consumers to the
market. That would end up costing insurers, and possibly taxpayers, money.
The case against delay was outlined in a memo circulated to lawmakers by the
insurance lobby last week. The document from America's Health Insurance Plans
warned that delay could have a "destabilizing effect on insurance markets,
resulting in higher premiums and coverage disruptions for individuals and
families."
For now, the administration is sticking with the insurers. Health and Human
Services Secretary Kathleen Sebelius on Wednesday called delaying the tax
penalties for those who miss the deadline premature. Testifying before a House
committee, Sebelius said she was confident the site would be running smoothly by
the end of November, giving consumers four months to enroll easily online before
the deadline of March 31.
President Obama made the case in Boston, where he argued that the model for
his healthcare law — the 2006 Massachusetts law that then-Gov. Mitt Romney
pushed through — experienced a similarly slow rollout and went on to
success.
There is more than policy keeping the administration from pursuing what some
contend is a simple fix. House Republicans have long pushed to delay the
mandate. Any concession on the point would hand another "I told you so" moment
to the GOP only weeks after the White House and Democrats watched the government
shut down rather than agree to Republicans' demands to suspend the mandate for a
year.
Still, the politics of the issue could change quickly as Democrats face
pressure to show they are responding to public frustration with the website. Ten
Democratic senators have signed a letter asking the White House to extend the
date beyond March 31 — six of those are up for reelection in 2014.
Sen. Jeanne Shaheen (D-N.H.) said an extended enrollment was merely a fair
way to make up for a website rollout she labeled a "disaster." Millions of
people have been shut out of the site intended to link consumers with private
health plans. "That is unacceptable; consumers should not pay a penalty because
a website did not work," Shaheen wrote in an op-ed published Wednesday in USA
Today.
Advocates for the extension note that the administration has already pushed
back the date by six weeks in an attempt to align mismatched deadlines outlined
during the rule-making process. Another limited extension is unlikely to change
consumer behavior much, some experts opposed to a delay concede.
"To change sends a message: Don't worry about signing up quickly. So there is
an impact, but it depends a lot on how long an extension it is," said Linda
Blumberg, a health policy expert at the Urban Institute.
Blumberg said it was too soon to know whether an extension was necessary. Any
decision should come only after insurers know who is signing up and whether they
are seeing too many sick customers to deliver on the premiums they've promised.
There are two major provisions already built into the law to help insurers
adjust for risk pools, she said.
Obama advisors made similar arguments. Extending the enrollment period by a
few months or a year increases the possibility that people won't sign up until
they're too sick, increasing the costs for everyone else, said Chris Jennings, a
former advisor to President Clinton now working on Obamacare implementation.
Enforcing the requirements for insurers without enforcing those for
individuals would compound the destabilizing effect, Jennings said.
"No one will sell you house insurance when your house is on fire," he said.
"If you want to ban discrimination against people with preexisting conditions,
then you have to have everyone in the pool. That's why you need the individual
responsibility requirement."
Critics of the president's law are reviving the push to undo the mandate.
Romney issued a statement Wednesday suggesting a number of changes, including
"carefully phasing it in to avoid the type of disruptions we are seeing
nationally."
In support of the Obama plan, some former Romney advisors have stepped
forward to counsel patience through what they suggest is just a rocky
beginning.
The law ramped up slowly in Massachusetts, said Jonathan Gruber, an MIT
economist who has advised Romney and Obama on healthcare reform.
In the first month of enrollment in 2006, he said, only 123 enrollees from
the premium-paying population — comparable to the group using the marketplaces
created by the Affordable Care Act — signed up. That represented fewer than 1%
of those who eventually signed up within the enrollment period.
"The fact that people aren't signed up now for a policy they can't even get
until January, and which they're not mandated to have until March, is not at all
interesting or important," Gruber said on a White House conference call held as
Obama prepared to travel to Boston. "What matters is the fact that it will ramp
up, and it will ramp up over time."
The arc of enrollment in Massachusetts suggests that the deadline itself
plays an important role, he said.
As the program neared the deadline, he said, "you saw an enormous increase in
healthy people signing up."
In their push on Capitol Hill, insurers are arguing that the March 31 date is
crucial to the assumptions they used in developing the premiums they are
offering at healthcare.gov.
According to America's Health Insurance Plans, the industry group, changing
these "vital enrollment incentives" would mean the premiums that health plans
filed for next year would have to increase to account for fewer young and
healthy people signing up for coverage. Insurers must determine the premiums for
2015 in April, a deadline that would be hard to meet without knowing who had
signed up in 2014.
"Extending the open enrollment period would also drive up the 2015 premium
rates," the group's document says, "as health plans would have to start
submitting premiums to regulators before knowing who is enrolled in their
insurance plans."
kathleen.kennessey@latimes.com
christi.parsons@latimes.com
Copyright © 2013, Los Angeles Times