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Lower ACA Enrollment Projection Contradicts Consumer Demand

A Picture of Lou Reynolds Lou Reynolds
11/16/2015

While the Obama Administration has succeeded in providing health coverage to millions of Americans, certain holdouts are proving more difficult to insure. The U.S. Dept. of Health and Human Services (HHS) estimates that by the end of 2016, the total number of insured people nationwide will be about 10 million.

This represents an increase of about 1 million from 2015. The 10 million beneficiaries are those that both purchased plans and paid their premiums, whether through state-run exchanges or the federally facilitated Marketplace. While any increases benefit the American people, this number is lower than the more than 20 million estimated by the Congressional Budget Office (CBO).

This group is comprised of uninsured people who are eligible to purchase coverage on the federal and state health exchanges. HHS released a report detailing the group’s demographics. Among these findings:

  • About 57 percent are male.
  • Almost half are between 18 and 34.
  • More than one-third are minorities; about 19 percent are Hispanic, 14 percent are African-American and 2 percent are Asian.
  • Almost 40 percent have families earning between 139 and 250 percent of the Federal Poverty Level (FPL); about $30,000 to $60,000 for a family of four.
  • Almost eight in 10 have incomes that may qualify them for financial assistance.
  • 80 percent have less than $1,000 in savings.

Obamacare enrollment efforts should still yield success

Rather than worry, the Obama Administration believes that the enrollment numbers will increase over time. Richard Frank, HHS’ assistant secretary for planning and evaluation, states that they will be “seeing a much longer path” to getting people insured. Sylvia Matthews Burwell, the HHS Secretary, said that the agency expects more than 25 percent of these uninsured and eligible people will purchase coverage on the federal and state health exchanges during the upcoming Open Enrollment Period (OEP).

The 2016 OEP runs from Nov. 1, 2015, through Jan. 1, 2016. Burwell does, however, admit that the other 75 percent are “a little harder to reach.” The agency believes that these smaller estimates stem from the fact that fewer companies are planning to drop coverage than originally expected. In addition, fewer employees have made the move to purchase plans through the exchanges.

The pricing of the marketplace plans may play a part, as well. But going without coverage takes its own financial toll, as the Affordable Care Act (ACA) requires Americans to purchase health insurance during the OEP. If not, they face an IRS-imposed penalty; in 2016, this will be $695 for individuals and $347.50 per child, or 2.5 percent of your income, whichever is greater.

But even with the penalty, this group still needs persuading. In light of this, the HHS is committing its efforts to reaching these 10.5 million uninsured Americans eligible for the exchanges. Burwell says that the agency will target this group during the OEP. The HHS plans on boosting its marketing in communities with large uninsured numbers, such as Atlanta, Texas, Florida and Northern New Jersey.

Interestingly this guidance provided by the administration and HHS conflicts with what other organizations, specifically private companies working within the health insurance industry are finding. HealthNetwork recently released early data disclosing that consumer demand and overall search traffic coming to their properties is up 40% compared to this same time last enrollment season. The company estimates that in total more than 15 million American health insurance shoppers will research their options through one of their existing health insurance comparison websites such as HealthNetwork.com

Health insurance shoppers who wish to compare Obamacare plan rates for 2016 easily can use the form below. You will have the ability to compare plan data for both on-exchange plans (Obamacare) as well as private marketplace, also called off-exchange plans.

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