By Melissa Attias, CQ Roll Call
October 15, 2015 -- The Obama administration is aiming to add fewer than 1 million paying customers to the health care law's insurance exchanges by the end of 2016.
Health and Human Services (HHS) Secretary Sylvia Mathews Burwell said her department aims to have 10 million people paying for coverage through the marketplaces set up under the Affordable Care Act by the close of next year, up from a projected 9.1 million by the end of 2015.
The goal is much lower than the Congressional Budget Office’s (CBO) projections from March which estimated that 21 million people would have coverage through the exchanges in 2016—a discrepancy that HHS defended on a conference call.
Richard Frank, assistant secretary for planning and evaluation, said HHS adjusted its estimates because significant shifts to the new exchanges from individuals who have employer-sponsored insurance and those who buy their insurance on their own through the individual market outside of the exchanges have not occurred as expected.
He also noted that the administration is expecting to sign up 25 to 30 percent of the eligible people who are still uninsured, which he argued is "fairly big growth." HHS projected that between 2.8 million and 3.9 million uninsured individuals who qualify for exchange coverage will choose plans during the third open enrollment period that runs from Nov. 1 to Jan. 31. That’s out of an estimated pool of 10.5 million people who could sign up.
"Rather than reaching the plateau in three years as CBO projects, we’re seeing a much longer path to the longer-term equilibrium for this market," Frank said. The CBO estimated that exchange enrollment would surge from 11 million in 2015 to 21 million in 2016 before growth would level off.
The administration’s goal of having 10 million people who paid their premiums enrolled by the end of next year matches federal projections. HHS’s Office of the Assistant Secretary for Planning and Evaluation estimated that between 9.4 million and 11.4 million people will be paying their premiums and remain enrolled at the close of next year, based on past experience and market fluctuations from individuals’ changing life circumstances.
That’s lower than the 11 million to 14.1 million people who are expected to take the first step of enrollment by selecting plans on the exchanges during open enrollment. That includes 7.3 million to 8.8 million people who are expected to renew their coverage from last year.
But some may not end up paying their premiums.
The number of people enrolled in health plans sold in state and federal insurance markets fell from 11.7 million who had signed up near the end of February to 10.2 million paid customers at the end of March, according to HHS. Some people switched their coverage and some were dropped by insurers after they did not pay their premiums.
Burwell called 10 million "a strong and realistic goal," noting that the uninsured population will be harder to reach compared to past enrollment periods. She said the remaining pool is younger, more likely to be male and often unaware of the exchanges or available financial assistance. The administration plans to target its messaging and outreach to reflect that.
"This open enrollment’s going to be a challenge but ultimately having fewer uninsured Americans to sign up is a good problem to have—because that is what our fundamental core goal is: to reduce the number of uninsured," Burwell said.
The penalty for individuals who do not have health coverage will increase in 2016 from $325 or 2 percent of taxable income in 2015 to $695 or 2.5 percent of income, whichever is more.
Lori Lodes, spokeswoman for the Centers for Medicare and Medicaid Services, said it’s the administration’s responsibility to make sure consumers understand their options.
"We need to make sure that we are very clear and explicit about that $695 penalty so that people understand the choice that they are making," she said.